This topic isn't at the top of anyone's bucket list. However, getting to grips with the income and expenses associated with this period of life will create clarity and can reduce anxiety for everyone. Here's a framework to approach this task:

Evaluate Financial Resources

Start by assessing all financial assets, including superannuation, savings, and investments. It's also important to factor in any government funded income that you may be eligible for via Services Australia. Such as the Age Pension, Home Support Packages, Residential Support Packages, as well as various other assistance programs and carer support payments. Many families rely on these in retirement and through their final years. Understanding these resources will help outline a clear picture of what financial equity is available.

Understand Healthcare Costs

Medicare covers many healthcare costs for residents in Australia. However, there are still out-of-pocket expenses to consider, especially for services that Medicare doesn't fully cover, such as dental care, physiotherapy, and some medications. For those requiring more comprehensive care, private health insurance can help manage these costs, so it’s wise to review your policy and really understand what is covered.

Budget for Non-Medical and Daily Living Expenses

Include regular costs such as groceries, utility bills, and maintenance of the home, including rent or loan interest payments. If home modifications are necessary to improve accessibility, like installing ramps or safety rails as well as modern digital equipment, these costs need to be counted for as well.

Plan for End-of-Life Expenses

End-of-life expenses can include costs associated with in-home care, residential aged care, palliative care, and of course funeral arrangements (read the separate article on this topic). Plus consider legal fees associated with the administration of an estate. Prepaid funeral plans or funeral bonds can be a practical way to manage some of these expenses ahead of time, or alternatively making arrangements to cover these costs in the will.

Establish an Emergency Fund

Just as is the case with regular living costs, setting aside an emergency fund is crucial to cover unexpected expenses without disrupting the planned budget. This fund should be easily accessible and sufficient to handle unforeseen costs. 

Seek Professional Advice

Consulting with financial advisors, estate planners, your lawyer and accountant is highly recommended. These professionals can offer guidance on maximising the benefits of your assets, minimising tax implications, and ensuring that all estate planning documents, such as wills and powers of attorney, are up to date.

Regularly Review and Adjust the Budget

Financial situations and health can and will change, requiring regular reviews and adjustments of your budget. Don't just set and forget. Make time to review the situation and become familiar with fluctuations and changes to the plan. This might mean reallocating resources, considering different living arrangements, or updating legal documents to reflect current wishes and circumstances.

By following these steps, you can create a robust financial plan for the last stage of life, ensuring finances are effectively managed, while focusing on well-being and quality of life.

For more information and support with financial matters, chat to Violet via the message box below, register for your Violet Plan, or book to speak with a Violet Guide via the menu links at www.meetviolet.ai