How to Pay for Senior Living
Making the decision to move to senior living can be a tough one. Even if you’re sold on its multitude of benefits, cost is often a big concern. In fact, according to Advisory Board’s 2017 report on Consumer Preferences in Post-Acute and Senior Care, when comparing communities the yearly cost is the number one factor affecting choice. But there’s no reason to accept a lesser community based on price, or let that deter you from senior living altogether. Not when there are so many ways to help offset the cost of senior living. Here’s how.
Senior Living by the Numbers
We might as well get this out of the way first. You’ll find that senior living cost is tied to the level of care you may need. It’s a continuum that includes:
- Independent Living – For active seniors who need little daily assistance and want a carefree lifestyle with a range of social opportunities. Although there is little published data on the average cost of independent living because it varies so greatly; it typically ranges from $1,000 to $4,000 a month.
- Assisted Living – A greater level of care that includes assistance with daily tasks plus the amenities and social opportunities of independent living. According to the most recent Genworth Cost of Care Survey, a private, one-bedroom costs $4,000 per month on average.
- Memory Care – An environment specifically designed those with Alzheimer’s disease and dementia that includes 24/7 support, structured activities and specially-trained staff. There is also little published data on average costs for memory care because it varies so greatly, however it typically ranges from $2,000 to $7,000 a month.
- Skilled Nursing – What you might consider the highest level of care with 24/7 nursing as well as physical, speech and occupational therapists onsite. According to the most recent Genworth Cost of Care Survey, a semi-private room is $7,441 and a private room is $8,365 a month on average.
The Value Behind the Cost
Yes, senior living can seem expensive but when you look a little deeper into the value that’s included within those monthly numbers, in some cases it can be less than aging at home!
For example, out-of-pocket costs at home such as food, entertainment and home upkeep are typically included in the monthly cost of senior living. In many cases, at least some utilities are included as well.
Then there are the pluses like beautiful campuses, spacious accommodations and amenities such as a pool, fitness centers housekeeping and laundry services as well as monthly calendar filled with clubs, classes, events and outings. But what’s invaluable is the peace of mind that comes with knowing you’ll always have care and support, if and when you need it.
Financial Solutions for Senior Living
Value or not, you can only pay what your budget will allow right? Well, you may not realize that there are a variety of solutions that may be able to help you stretch that budget and your options, such as:
- Veterans Aid & Attendance Benefit – Wartime veterans or a surviving spouse with limited income may be eligible, to receive a non-service connected pension (above the basic pension) to assist in paying for assisted living, home health care, adult day care or skilled nursing if you meet certain conditions.
- Long-Term Care (LTC) Insurance – LTC insurance can help you pay for the cost of home care, adult day care, assisted living, memory care, skilled nursing and hospice by covering services typically not covered by health insurance, Medicare or Medicaid.
- Life Insurance Conversion – Your in-force life insurance policy may be able to convert into a pre-funded financial account that disburses a monthly benefit to help pay for needs such as home care, assisted living, skilled nursing and hospice. Unlike life insurance, this account is a Medicaid qualified asset.
- Reverse Mortgage – A type of home equity loan for homeowners 62 or older who want to access their equity to supplement retirement income. In this case, the lender makes payments to you based on a percentage of your accumulated equity.
In addition, you may be able to use your current assets as collateral. Consider selling or renting your home, for example. Do you have savings, stocks, bonds or annuities? What about income such as Social Security or a pension. Any or all of these can help towards senior living costs.
For additional help in making the move to senior living, check out our Guide to Funding Senior Care & Housing today →