Refundable Accommodation Contribution (RAC): What It Means for You
Moving into an aged care home is a big step, and one of the biggest questions is how to pay for it. The Refundable Accommodation Contribution (RAC) is one way to cover the cost of your accommodation if you are eligible for government support. It is not an extra fee, but rather a way to contribute to your stay without losing your money forever.
Think of it like a security deposit when renting a home. You pay an amount upfront, and when you leave, it is refunded to you or your estate.
How Does the Refundable Accommodation Contribution (RAC) Work?
Not everyone pays the same amount for aged care. Your financial situation determines what you will contribute. The government assesses your income and assets, and if you meet certain conditions, you may be required to pay a Refundable Accommodation Contribution instead of a Refundable Accommodation Deposit (RAD).
Here is what you need to know:
- It is set by the aged care provider based on their pricing.
- You do not pay more than what is needed for your accommodation.
- It is refunded in full when you leave, unless you choose to have part of it used for daily care fees.
Why Is the Refundable Accommodation Contribution Important?
Aged care homes must follow aged care standards set by the government, ensuring that residents receive quality care and comfortable living arrangements. The Refundable Accommodation Contribution helps cover the cost of providing that accommodation while making sure that you are not left out of pocket in the long run.
It also gives peace of mind. Since the amount is refundable, you or your family will not lose the money permanently.
Who Needs to Pay the Refundable Accommodation Contribution?
Your financial assessment will determine whether you need to pay a Refundable Accommodation Contribution or a Refundable Accommodation Deposit. If you have low to moderate financial means, you may be asked to pay a Refundable Accommodation Contribution instead of the full deposit.
You can choose to pay it in one of two ways:
- As a lump sum – This amount is held and refunded when you leave.
- As a daily payment – This is like paying rent instead of a lump sum.
If you prefer, you can also pay a combination of both.
Final Thoughts
Planning for aged care can feel like trying to read a map with tiny print, but understanding how payments work makes things easier. The Refundable Accommodation Contribution is one way to help cover the cost of your stay, while still keeping your money secure.
It is always a good idea to talk to a financial adviser or a trusted family member before making any decisions. Knowing your options can help you feel confident about your next steps.
