Learn how to decide between a Refundable Accommodation Deposit (RAD) and Daily Accommodation Payment (DAP) for Australian aged care accommodation.
Key areas covered:
- What is the difference between a RAD and DAP?
- What factors should I consider when choosing between RAD and DAP?
- Can I change between RAD and DAP after moving into aged care?
What is the difference between a RAD and DAP?
A RAD (Refundable Accommodation Deposit) is a lump sum payment for your aged care accommodation that is fully refundable when you leave. A DAP (Daily Accommodation Payment) is the equivalent amount paid as a daily fee that is not refundable. You can also choose a combination of both.
What factors should I consider when choosing between RAD and DAP?
Consider your financial situation, including available assets, pension eligibility, and investment returns. Also think about how long you might need care, whether you want to keep or sell your home, and the impact on your estate planning. It’s recommended to seek professional financial advice before deciding.
Can I change between RAD and DAP after moving into aged care?
Yes, you can generally convert a DAP to a RAD within 28 days of entering care. You can also pay a partial RAD and cover the remainder with a DAP. However, once you’ve paid a RAD, you cannot convert it back to a DAP unless the facility agrees.
