Key points
- Read the residential aged care agreement carefully before signing, including fees, services and how the agreement can end.
- Accommodation can usually be paid as a lump sum, a daily payment, or a combination. The choice affects cash flow and the family home.
- An enduring power of attorney made while the person still has decision-making capacity can avoid delays and VCAT applications later.
- Aged care rules changed when the new Aged Care Act 2024 (Cth) started on 1 November 2025, so check that any advice you rely on is current.
The residential aged care agreement
When someone moves into an aged care home, the provider will ask them (or their representative) to sign an agreement. It sets out the care and services provided, the fees and charges, the room, and the rights and responsibilities of each side. Before signing, check:
- which services are included, and which cost extra;
- all fees, including any daily fees, means-tested contributions and additional service fees;
- the room or accommodation being provided, and whether it can change;
- how the agreement can be ended, and what happens to any lump sum when it ends; and
- how complaints are handled.
Paying for accommodation
Accommodation costs can generally be paid as a refundable lump sum, a daily payment, or a combination of the two. The right choice depends on the person’s assets, income, whether the family home will be sold or kept, and pension implications. It’s worth getting financial advice as well as legal advice before deciding. The rules changed for many people entering care from 1 November 2025, so make sure any information you’re relying on reflects the current law.
Who can sign and make decisions?
If the person can still make their own decisions, they should sign the agreement themselves, ideally after advice. If they can’t, someone with the legal authority to act for them will need to. In Victoria, that’s usually done through:
- an enduring power of attorney, for financial and personal matters;
- a medical treatment decision maker, for medical decisions; or
- an order from VCAT appointing a guardian or administrator, if no valid appointment exists.
Enduring powers of attorney can only be made while the person still has decision-making capacity, so it’s important to put them in place early. See our wills and estates page for help with these documents.
Protecting an older person from financial abuse
Unfortunately, older people can be pressured into handing over money, signing documents or changing their will. Warning signs include unexplained bank withdrawals, new “friends” taking an interest in their finances, or sudden changes to legal documents. If you’re concerned, get advice. Options can include reviewing or revoking a power of attorney, or applying to VCAT.
Retirement villages are different
Retirement villages are covered by different laws to residential aged care, with their own contracts, fees and exit entitlements. If you’re considering a retirement village, have the contract reviewed before signing.
How we can help
Asher Freeman Lawyers helps older Victorians and their families with aged care law, including reviewing aged care agreements and retirement village contracts, enduring powers of attorney, and disputes with providers. We work online or at our Chadstone office (by prior appointment), and can often meet with family members together.
Frequently asked questions
Should I sign the aged care agreement straight away?
Take the time to read it and get advice. Check the services, fees and how the agreement can end before signing.
Who can sign if my parent can't make decisions anymore?
Someone with legal authority, such as an attorney appointed under an enduring power of attorney, or a guardian or administrator appointed by VCAT.
Can my parent still make a power of attorney?
Only if they have decision-making capacity at the time. If capacity is in doubt, get advice quickly, as a medical assessment may be needed.
Are retirement villages the same as aged care?
No. Retirement villages are governed by different laws and contracts, with their own fees and exit rules.
This article is general information about Victorian and Australian law as at 8 October 2026. It is not legal advice. Contact us for advice about your situation.
