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  By: Antony Foote. TNZO Editor
  So you thought buying your own home was a great way to provide a place to live for yourself and distant security for your kids, you were probably wrong! The reality is this, if you are going to enter a rest home, there's probably no way to leave anything to anyone at the end of the journey. Rest home fees are hideous. The very poor, those with no assets or cash have the opportunity to receive full subsidies to pay the NZ $1240 per week bill for their care. This is just basic care. You'll need to pay extra if you want more than a basic roome with a bed and modest dresser.
    Unfortunately due to a dirty trick of the economy coupled with greed of housing investors has forced house prices to ridiculous levels. How does this effect your rest home subsidy? - It defies the cap before consideration of care subsidies which is set on a number of criteria, the main being the value of your own home and things associated with it such as debt, money owed elsewhere, gifting to family etc, outstanding invoices, inheritances within 5 years, board or rent paid to you, yes, board is held as income against your house value and any subsidy application, even though it's a lodger paying for what they use of your resources.
The capped value of your home, or your interest in the home is NZ $239,930 for singles who own 100% of their home and do not share ownership with a partner.
Here's the table:
  • If you're 50-64 and single with no dependent children, you'll automatically meet the asset test.
  • If you're 65 or older, your and your partner's (if you have one) total assets must be $239,930 or less. If you have a partner who's not in long-term residential care, you can choose whether the total value of your combined assets is either:
  • $131,391 or less, if you don't want to include the value of your house and car (your house isn't counted as an asset if it's the main place where your partner or dependent child lives), or
  • $239,930 or less, if you do want to include the value of your house and car.

    Against this is debt, unpaid invoices, any gifting of assets to anyone, family etc, shares in your property, cash given away and income, including rent, board and rent on the property you own, your car, money paid to the resthome already before susbidy approval (this could be lost as a cost if subsidy not yet granted and you pay too early), any trust you hid money in, inheritances within the last 5 years and possibly some I've missed.
    Don't even bother trying to hide money away in the early stages of your life it will be found and used against your estate when applying for rest home subsidy in New Zealand.
    What is the point of this warning? Simple. Rest home subsidy rules need to be radically upgraded so elderly people can have some expectaion of a fair assessment to gain the Residential Care Subsidy. The base point to all of this is the primary tell in your resthome financial journey if you own a home freehold as you apply, there is very little expectaion of getting the subsidy because pretty much all houses in New Zealand are now over cap! That puts you off to a massive disadvantage right from the start in what is a terribly difficult process.
    If there is one takeaway from this it's that you should never assume a parent or loved one will never end up in care. It's also high time the New Zealand government changed their level of financial means test to something closer to $300,000NZ for the value of a home to at least lower the bar enough to be able to hope for a subsidy when you need it most.The current limits for means testing are manifestly unfair...Ed

Welcome to The New Zealand Orator.
I am the Managing Editor, Antony Foote.
It's my goal to weed out all the trash and fake news so you will have an enhanced news viewing experience.
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I wrote this documentary about prisons and police in New Zealand back in the 1990's when I was a prisoner in New Zealand...Ed

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