How aged care fees work
A plain-English overview. Figures on Retirely are illustrative — always confirm costs with the home.
The four costs you may pay
- Basic daily fee — a standard contribution everyone can be asked to pay, set at 85% of the single Age Pension.
- Accommodation payment — your room. You can pay it as a lump sum (RAD), a daily amount (DAP), or a mix of both.
- Means-tested care fee — an extra contribution if your income and assets are above the thresholds. There are annual and lifetime caps.
- Extra and additional services — things like a single room, hairdressing or a specific outings program.
RAD or DAP?
The Refundable Accommodation Deposit (RAD) is a lump sum refunded when you leave. The Daily Accommodation Payment (DAP) is the interest you would have earned on that lump sum, paid daily instead. Paying a RAD is not automatically better — it depends on whether keeping the money invested or in the family home suits you more.
Get advice
Aged care fees interact with the Age Pension, tax and the family home. Before committing to a RAD, speak to a financial adviser who specialises in aged care. This page is general information, not financial advice.