This can benefit people who:

  • do not have sufficient cashflow to meet aged care expenses

Potential Benefits:

  • Paying DAP by drawing down from the RAD, reduces the amount of ongoing fees that have to be met from the persons cashflow
  • Where a person pays part of their accommodation payment as a RAD, aged care facilities must agree to the drawdown of DAP payments from the RAD

Things to be aware of:

  • Drawing down the DAP from the RAD will reduce the balance of the RAD over time.
  • DAP payments will increase over time as the outstanding balance of the accommodation payment increases
  • If RAD balance reduced to nil, the person will need to pay additional RAD or commence paying DAP from regular cashflow
  • Need to consider estate planning implications of reduced RAD payable on death

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Disclaimer and Warning
The information above is of a general nature only. It should not be used as a source to make financial decisions. It’s also important to note that the legislation and figures related to this topic tend to change regularly and therefore the information above may not reflect the current status. We recommend that if you are looking for advice on this matter, you should contact us.