As populations age across Australia and New Zealand, long-term care and assisted living are becoming essential considerations not only for older adults but also for their families and the broader healthcare system. With care costs steadily increasing across the region, financial planning for long-term care and assisted living is becoming increasingly important for many families. At Tunstall Healthcare, we understand that effective planning increasingly includes considering how Connected Care technologies can support safer, more independent living while potentially managing overall care costs.

While budgeting and superannuation strategies are commonly discussed, the potential role of technology, such as personal alarm systems, in supporting safer, more independent ageing is increasingly recognised as a complementary part of long-term care planning.

Why Planning Matters

Long-term care needs can vary greatly from person to person, ranging from occasional in-home support to around-the-clock assistance in a residential care facility. Each type of care comes with its own emotional and financial implications, and the costs can accumulate significantly over time. For many families, the need for care arises suddenly, often due to illness, injury, or a progressive condition like dementia, leaving little time to plan and causing considerable stress during an already challenging period.

This is why early financial preparation is crucial. Research from Financial Planning for Older People: A Holistic Approach suggests that effective planning for later life should go beyond budgeting for care costs. It should also consider broader factors such as personal care preferences, future living arrangements, and strategies to manage financial risks. This might include insurance products, advance care directives, or investing in supportive technologies that allow people to live safely and independently for longer.

Compassionate planning is also essential. It’s not just about numbers—it’s about protecting dignity, maintaining choice, and reducing the burden on loved ones. Involving family members in these conversations early on can foster shared understanding, reduce conflict, and ensure everyone is better equipped to make informed decisions when the time comes.

The Rising Cost of Aged Care

In both Australia and New Zealand, the cost of aged care is increasing, driven by ageing populations, longer life expectancies, and evolving care needs. While aged care funding is supported in part by government subsidies, individuals are still responsible for covering a range of expenses, which can quickly add up without proper financial planning.

Typically, families can expect to encounter:

• Basic daily fees: Standard charges paid by all residents in aged care facilities to cover essential services such as meals, cleaning, and laundry.
  
• Means-tested care contributions: Additional fees determined by an individual’s income and assets, contributing to personal care and nursing services.
  
• Accommodation payments: Costs for room and housing in residential aged care, which may be paid as a refundable deposit, daily payment, or a combination of both.
  
• Out-of-pocket expenses: Charges for services not covered by government programs, such as premium room features, physiotherapy, or social activities.
  

A Closer Look at Costs in Australia

In Australia, aged care affordability is becoming a major concern. Average costs for residential aged care are projected to rise substantially over the coming years, which may pose affordability challenges for many Australians without early financial planning. Australia’s Aged Care Taskforce Final Report outlines major changes aimed at ensuring the long-term sustainability of the sector. These reforms aim to adjust the balance between public funding and individual contributions, especially among older Australians with higher financial capacity. 

In response to the recommendations from the Royal Commission into Aged Care Quality and Safety, the Australian Government has proposed major reforms through the Aged Care Bill 2024, set to take effect from 1 July 2025. These changes aim to improve care quality, transparency, and sustainability, but will also affect how much individuals pay for aged care. Notable recommendations include:

• Greater Contributions from Wealthier Individuals: Self-funded retirees and those with higher assets or income may be required to contribute more toward the cost of both in-home and residential aged care services.
  
• New Daily Fees for Residential Care: A proposed Hotelling Contribution of up to $12.55 per day would cover accommodation-related services, while a Non-Clinical Care Contribution of up to $101.16 per day would support day-to-day personal care services.
  
• Lifetime Contribution Cap: To maintain fairness, a cap of $130,000 or four years of payments (whichever comes first) would limit total out-of-pocket expenses.
  
• Accommodation Reforms: The maximum allowable room price is set to rise to $750,000 from January 2025. Refundable Accommodation Deposits (RADs) may be phased out entirely by 2035, simplifying the system and reducing financial risk for families.
  
• Support at Home Program: This new model will replace the existing Home Care Packages with eight levels of tailored care, tighter means testing, and larger service budgets. However, it introduces limits on how unspent funds can be rolled over.
  
• Fairness Protections: A “no worse off” safeguard will ensure that current care recipients are not disadvantaged by the changes. Those with limited financial means will continue to be supported through public funding.
  

Rising costs have the potential to gradually deplete retirement savings and add financial and emotional pressure on families managing ongoing care responsibilities. The upcoming reforms signal a broader shift toward shared financial responsibility and more individualised care. As a result, it’s more important than ever for families to plan ahead and consider practical, cost-effective solutions that support safe, independent living for older adults at home.

The Situation in New Zealand

In New Zealand, similar financial pressures are mounting in the aged care sector. Data from Te Whatu Ora’s DHB spending on older people’s health shows steadily increasing District Health Board spending on services for older adults, but this growth isn’t keeping pace with rising demand as the baby boomer generation enters retirement.

The sector faces evolving challenges, including an ageing population, increasing care needs, and funding considerations that require innovative solutions. Many aged care providers are operating at a loss, while workforce shortages are restricting care availability. A recent Ansell Strategic report on aged care sustainability highlights that over half of residential aged care facilities face financial sustainability challenges, with smaller and rural providers disproportionately affected.

Much like Australia’s recent reforms, where wealthier residents contribute a greater share of care costs, there is growing discussion in New Zealand about whether a more income-based contribution model may be needed to sustain the sector. With over half of aged care facilities operating at a loss and bed shortages expected to worsen, experts warn that the current taxpayer-funded model is no longer sustainable.

The University of Auckland highlights that without significant reform, New Zealand’s aged care system risks becoming increasingly unsustainable. Their experts emphasise the need for a funding model that balances affordability, quality, and equity, ensuring vulnerable older adults can access necessary care without placing undue strain on taxpayers or families. This commentary underlines the urgency of adopting new approaches to support an ageing population effectively.

Integrating Safety Technology into Financial Planning

As people live longer across Australia and New Zealand, the demand for aged care services continues to grow. However, many families are seeking more accessible and affordable support options. Research published in the International Journal of Environmental Research and Public Health highlights a concerning combination of increased life expectancy, under-resourced infrastructure, and strained funding models. These challenges are creating increased demand for alternative care solutions and prompting a strong policy and community shift toward ageing in place, supporting older people to live safely and independently in their own homes for as long as possible.

This growing movement reflects a shared desire among older Australians and New Zealanders to maintain their autonomy, connection to community, and familiar surroundings. However, ageing in place requires more than just good intentions. It demands thoughtful planning, proactive investment, and access to the right tools.

One increasingly popular solution is the use of personal alarm systems, which provide round-the-clock access to help in the event of a fall, health emergency, or unexpected incident. In addition to enhancing safety, personal alarms may help reduce the risk of preventable hospital admissions and can sometimes delay the need for residential care, particularly when integrated into broader support plans.

Research from the University of California suggests that integrating home safety technologies, such as alarms and remote monitoring systems, may help improve health outcomes and reduce long-term care utilisation. For families and financial planners alike, these technologies represent a practical and compassionate way to manage both care needs and future costs. They aim to preserve independence and dignity, while also providing an alternative approach that may help ease demand on traditional care systems.

The Support at Home Program in Australia and similar home-based services in New Zealand reflect this shift, aiming to tailor care to individual needs while promoting personal choice and wellbeing. When combined with adaptive technology and community support, these programs can help ensure older people remain safely in their homes longer, especially in rural or resource-limited areas where access to residential care may be limited.

As the book Long-Term Services and Supports: Planning for an Aging Population underscores, effective planning for later life isn’t just about financial readiness. It’s about aligning care pathways with lifestyle goals, risk tolerance, and available resources. By blending practical financial planning with emerging technologies and a person-centred approach, we empower older people to age with greater safety, dignity, and control.

Related Reading: Looking to the Future of Aged Care in Australia

Supporting a Flexible, Independent Future

Tunstall Healthcare offers a wide range of connected care technologies designed to support independence, enhance safety, and bring peace of mind to both older people and their families. These solutions are especially valuable for those wishing to age in place, or for people who live independently or manage health conditions. 

• Fall detector pendants provide automatic alerts in the event of a fall, enabling a rapid response—even if the person is unconscious or unable to press a button. These are particularly valuable for people with mobility issues, balance difficulties, or medical conditions that increase fall risk. Quick intervention may help prevent complications and potentially reduce the need for hospitalisation.
  
• GPS-enabled mobile alarms are ideal for people who remain active in the community. Whether it’s a daily walk, grocery trip, or social outing, users are protected with location tracking and two-way communication, ensuring help is always just a button press away, no matter where they are.

Ageing and disability can bring many unknowns, but with the right support, individuals and families don’t have to face these changes alone. By combining technology with compassionate care, Tunstall helps create a sense of security, reassuring people that help is always close at hand.

Planning for the future is about more than numbers on a page. It’s about ensuring our loved ones can live with dignity, independence, and safety. Long-term care planning today includes more than just managing superannuation or pension entitlements—it’s about finding the right balance of financial resources, support networks, and technologies that make ageing at home possible.

Discover Tunstall Healthcare’s full range of smart, supportive technologies and learn how they can become part of your long-term care planning toolkit today.

Keep Reading: Home and Away: Why Dual Personal Alarms Offer the Best Protection for Independent Living