Retirement living, assisted living and residential aged care are often spoken about as though they are the same thing. They are not, and the difference matters.
Each provides a different level of support and care. The contracts, costs and rules are different too.
A place may look beautiful and offer plenty of services, but that does not mean it can provide the care your parent may need now or in the future.
Understanding which category you are looking at can prevent a great deal of confusion later.
What is the difference between retirement living, assisted living and residential aged care?
Retirement living is primarily a housing and lifestyle choice for people who can live independently.
Assisted living provides private accommodation with some everyday support.
Residential Aged Care is for people who need daily personal or clinical care, including those with higher or more complex care needs.
The name used in a brochure does not always tell you exactly what is being offered. The important things are the agreement, the services included and the level of care available.
What is retirement living?
Retirement living is designed for older people who want to live independently in their own apartment, unit or villa. If their needs change, they can arrange personal or clinical care separately, either privately or through eligible government-funded services.
Retirement villages are generally governed by state or territory retirement village legislation. Financial arrangements vary but may include an entry payment, ongoing service fees and a deferred management fee when the resident leaves.
The key point is that retirement living provides housing, not care.
What is assisted living?
Assisted living sits between independent retirement living and residential aged care.
Residents usually live in their own apartment or unit but receive some services as part of the arrangement or purchase them as needed. These might include meals, cleaning, laundry, a daily welfare check, emergency assistance or help arranging personal care.
It may suit someone who wants to remain independent but is finding some aspects of everyday life at home more difficult.
Assisted living may be described as a serviced apartment, supported living or assisted care. There is no single national definition, so the services and level of support can vary considerably between providers.
In most cases, assisted living is a private housing and service arrangement. It is not automatically regulated or funded in the same way as residential aged care.
A resident may be able to receive eligible government-funded care through the Support at Home program. However, this funding is for eligible aged care services and is not intended to cover private accommodation, village fees or general living expenses.
What is residential aged care?
A Higher Everyday Living Fee, usually called a HELF, is an optional charge for a service that is additional to, or of a higher standard than, the service the home is required to provide.
Depending on the home, this might include premium toiletries, subscription television, additional outings, premium menu choices or a wider selection of beverages.
A HELF is a separate agreement that is signed after the person moves into the home, and the person can decide which services, if any, they want.
Services offered in a bundle must be available to purchase individually.
How do retirement living, assisted living and residential aged care compare?
| Retirement living | Assisted living | Residential aged care |
Main purpose | Independent housing | Housing with some everyday support | Accommodation with daily personal and clinical care |
Living arrangement | Private unit, villa or apartment | Private apartment or unit | Private or shared room in an aged care home |
Level of support | Usually arranged separately | Some services included or purchased | Care and support available 24 hours a day |
Assessment required | No government aged care assessment | Usually, no assessment to enter | Assessment generally required for subsidised permanent care |
Clinical care | Not normally included | Limited or arranged separately | Nursing and clinical care available |
Regulation | State or territory retirement village laws | Depends on the arrangement and contract | Australian aged care law |
Best suited to | People who can live independently | People who want independence with some support | People with higher or more complex care needs |
Why does the difference matter?
The three options can look similar from the outside, but the level of care available may be very different.
An emergency call button does not necessarily mean a nurse is available. The option to purchase personal care does not necessarily mean the provider can support someone with advanced dementia or complex health needs.
The financial arrangements differ too. Retirement and assisted living are generally private contracts, while residential aged care operates within a government-regulated and partly government-funded system.
Before making a decision, it is important to understand:
- Is this independent housing, supported housing or regulated residential aged care?
- What care is actually available, particularly overnight?
- What happens if the resident’s needs increase?
Want to understand assisted living in more detail?
For a more detailed explanation of assisted living, including costs, contracts, Support at Home and what to consider before signing, Aged Care Conversations has produced Understanding Assisted Living in Australia: A Practical Guide for Older People and Families.
Aged Care Conversations provides independent, commission-free guidance. We do not accept commissions, referral payments or placement fees from providers. We work only for families.