CEO Salaries in Aged Care

Boomer picking is the new stock picking.

Australia has two demographic trends: declining access to housing and jobs for the young, and rocketing aged care costs for the aging.

For the elderly who prefer to age at home, care and maintenance costs continue to climb despite subsidies. Many are forced to sell the house and move to an aged care facility, which is only marginally cheaper. 

For their young, wages are stagnating, work is hard to enter and when obtained, precarious. Furthermore, housing costs are many multiples of average income.

Could a solution be for younger folk to forego traditional employment and become live-in carers for their elderly, on condition that all their living expenses are paid and they inherit a modest multi-million dollar, property?

Let's model it!

Variable	Sydney/Melbourne metro benchmark
Property Value (V)	$2,000,000
Remaining Life Expectancy (T)	5 years
Average Young Adult Salary (S_gross)	$85,000/year ($66,000 net after tax & HECS)
Young Person's Rent + Living Costs (L_young)	$35,000/year ($25k rent + $10k food/utilities)
Elderly Personal Daily Living Expenses (L_elderly)	$15,000/year (food, medical gap fees, utilities, personal transport)
Home Maintenance & Repairs (M_home)	$30,000/year (~1.5% p.a. of $2M property value)
Supplemental Private In-Home Care Costs (C_home)	$25,000/year (out-of-pocket top-ups above government packages for respite/nursing)
Aged Care Facility Costs (C_facility)	$24,000 basic daily fees + $50,000–$70,000/yr DAP + means-tested fees = ~$85,000/year

Assets for Care Scenario - Maggie and Arthur

Person	Option 1 - Aged Care Facility + Conventional Employment	Option 2 - Live-In Care + Inheritance
Arthur (25) 👨‍🎓	Net earnings over 5 years: $66,000 x 5 = $330,000 Rent & living expenses over 5 years: $35,000 x 5 = $175,000 Net savings after 5 years: $155,000 Distance to buying a $2M house: Yeah, nah.	Opportunity cost (forgone salary): $330,000 Saved living expenses (covered by homeowner): +$175,000 Inherited asset value at Year 5: +$2,000,000 Net wealth gain after 5 years: $2,175,000 Effective annualized compensation: ~$435,000/year tax-free.
Maggie (80) 👵	Upfront Capital Commitment: $750,000 lump sum paid from home sale proceeds as a Refundable Accommodation Deposit (RAD). RAD Retention Fee (Non-refundable): ~$15,000/year (~$71,430 total over 5 years based on a 2% p.a. provider retention fee deducted daily/monthly for up to 5 years). Basic Daily Fee: ~$24,380/year ($66.80/day, fixed at 85% of the single Age Pension to cover food, power, and laundry). Means-Tested Contributions: ~$46,500/year (max hotelling contribution + non-clinical care contribution triggered by the remaining $1.25M in liquid home sale proceeds). Personal Out-of-Pocket Expenses: ~$5,000/year (clothing, personal items, discretionary medical gap fees). Total Annual Cash Outflow & Retention Loss: ~$90,880/year. 5-Year Total Direct Financial Cost: ~$450,830 (comprising $379,400 in direct operational fees plus $71,430 permanently retained from the RAD balance). Net Financial Result: The net RAD returned to the estate drops to ~$678,570. The estate incurs $450,830 in total friction/fees, and the family permanently forfeits 100% of future property market growth on the sold $2,000,000 asset.	Elderly Personal Daily Living Expenses: $15,000/year Home Maintenance & Repairs: $30,000/year (1.5% p.a.) Supplemental Private In-Home Care (visiting nursing/respite top-ups): $25,000/year Carer Room & Board (additional food/utility allowance for live-in carer): $12,000/year Total annual living/care costs: $82,000/year 5-year total cash outflow: $410,000 Net Financial Result: Saves ~$40,830 in cash outflow over 5 years compared to residential care while retaining property, receiving full-time 1-on-1 support, and directing the remaining $2M asset to the chosen live-in carer via their estate.

So what does live-in care for inheritance need for success?

Success Criteria

• High Property Value: The home must be worth enough to justify the young person sacrificing career progression (typically $1.5M+ in Australian capital cities).
• Moderate Care Needs: The senior needs assistance with daily living (cooking, transport, light mobility, companionship) supplemented by modest external nursing top-ups ($25k/yr), rather than round-the-clock clinical medical intervention.
• High Mutual Trust: Both parties need alignment on boundaries and daily habits.

Traps for Young and Old Players

• Other Heirs: Disinherited children will challenge the ... Will under Family Provision claims, arguing undue influence or unconscionable conduct.
• Unexpected Longevity Risk: If a 5-year estimate turns into 15 years, the carer's career gap widens. 
• However, capital growth on Sydney/Melbourne property (averaging 5-6% annually) adds ~$100,000-$150,000 per year in home value, which far outpaces forgone wage growth.
• For the elderly person, capital growth tips the scales further in favour of aging at home, as liquid proceeds from the house sale will likely not appreciate as fast as a house, particularly once their effect on means testing is included.
• Centrelink & Tax: Receiving room, board, and expenses may impact the carer's welfare entitlements and tax obligations. It may also affect CGT calculations if the property is later sold.

These risks can be ameliorated with a proper ...

Family Care Agreement

Most family assets-for-care arrangements are undocumented. But formalising them is possible - even recommended - so that everyone thoroughly considers what they are getting into, receives the relevant support and advice ... 

... and picks their boomers (and young 'uns) wisely.