Overview
When one partner enters residential aged care, the financial arrangements for both partners change. The means-tested care fee is based on combined income and assets, Age Pension rates may shift, and the family home exemption rules come into play.
How assets are assessed for couples
For the means-tested care fee, Services Australia combines the assets of both partners and then divides the total by two to determine the assessable assets for the person entering care.
Home exempt (partner still living there) → Other assets: $350,000
Half attributed to person in care: $175,000
Assets test: ($175,000 − $59,500) × 17.5% = $20,213/year
How income is assessed
Combined income is halved for the assessment. Income sources include:
- Age Pension (both partners)
- Superannuation drawdowns
- Investment income
- Rental income (if applicable)
Age Pension rates for couples
| Situation | Rate (approximate, September 2025) |
|---|---|
| Couple (each) — both at home | $22,432/yr per person |
| Couple — one in care, one at home | Continues at couple rate (each) |
| Illness-separated rate (single-equivalent) | $29,754/yr per person |
The illness-separated pension rate
When one partner enters aged care, they may be eligible for the illness-separated rate — which is closer to the single Age Pension rate and higher than the standard couple rate.
The family home
If the partner remaining at home continues to live there, the family home is exempt from the assets test indefinitely. This is the single most important financial protection for couples in the aged care system.
See our family home guide for what happens if the second partner also enters care.
Planning considerations
- Do not rush decisions about the family home. While the at-home partner remains, the home is exempt.
- Confirm the correct pension rate with Centrelink. The illness-separated rate can make a meaningful difference to household income.
- Get a formal financial assessment. Services Australia will issue an aged care fee advice letter with the exact MTCF.
- Plan for the second partner entering care. Model this scenario early if both partners may eventually need care.
Use our free calculator to estimate costs for your specific situation.