Marion is considering having her parents come to live wither her, but isn’t sure how this will affect their Age Pension, or what will happen should they move to aged care.
My parents aged 86 and 85 are becoming too frail to live on their own. So the thought is to have them move in with us to ensure they eat properly and have support in visiting doctors, etc.
The only worry is the sale of their house and if their Age Pension is affected? In the near future, if a nursing home is required, will their Age Pension be affected?
Hope you can answer these questions as my parents do not want to become a financial burden.
A. You need to be careful about selling your parents' home and having them move in with you as the proceeds of the sale will be assessed as an asset.
If the intention was for them to buy another home, which it clearly is not, then the amount could be considered an exempt asset for up to two years.
You can view the current asset limits for non-homeowners here.
Also, if the money from the sale of their home is invested, the income derived will also be deemed and will be assessed under the income test.
Depending on your parents' current income and asset levels, their Age Pension payments could be affected.
You may wish to consider a Granny flat arrangement, whereby your parents transfer some of their assets to you for the right to live in your home for the rest of their lives. You can find out more about such arrangements by visiting HumanServices.gov.au.
In regards to selling their home if they need to move in to aged care, how the home or proceeds from the sale of the home are assessed depends on the bond which has been paid. You should read the section, Your former home on our website which details how the property will be assessed.
Before you make any arrangements, you should seek independent financial advice, or at the very least make an appointment to speak with a Centrelink Financial Information Services officer on your parents’ behalf. You can do this by calling 13 2300.
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