How to cover senior living costs

Affording senior living through financial planning, aid and staying healthy

Senior living can refer to many different types of retirement communities, including independent living, assisted living and memory care. These communities are typically private pay, but that doesn’t mean you have to have it all in cash savings. To help you navigate your options, this article will cover the important details of paying for senior living.

Assess your finances

“If you don’t already have a financial advisor, get one,” says Melanie Bedell, Vice President, Sales, at Holiday by Atria. “Even if you don’t feel like you have a lot of savings, talk with someone who can help you plan for retirement. You may have more options than you realize.”

A financial planner can help you develop a clear understanding of your retirement finances and what assets you have available to pay for senior living or long-term care.

Getting a clear understanding of the funds you have access to includes taking inventory of IRAs, savings accounts, investments, home equity and other assets that can be sold. It also includes frank conversations with family. Even if you only spend a brief time in a senior living residence, for example, to take advantage of a short-term stay after an injury, it’s important to know if your support network can help cover expenses.

Compare retirement living costs

When it comes to finding affordable senior living, the most important piece of advice is: Don’t wait until you need it. Bedell says, “If you wait until something happens and you have to find a place to live in a week, it creates a lot of pressure.” Whether you’re sick of doing dishes and wish you’d moved a year ago or you prefer to stay at home as long as possible, knowing how much senior living costs will empower you with options.

Part of determining if a retirement community is the right fit financially is having a realistic idea of expenses. Many people are surprised by the different kinds of retirement communities that exist, such as various independent living, assisted living and memory care options. These senior apartments feature all-inclusive amenities and are typically more affordable than nursing homes because the cost is generally determined by the level of care a person requires. This means the first step in assessing the cost of retirement living is knowing which senior living option best fits your needs.

For many homeowners, another surprise is realizing that the monthly cost of independent living communities can be less than staying at home. In these senior living residences, one monthly fee covers rent, meals, housekeeping, maintenance, security and amenities. Many communities also offer free transportation to local appointments and outings.

When you compare this flat rate with the expenses of maintaining a home – including the mortgage, property taxes, maintenance and repairs, lawn care and monthly bills – independent living often proves to be the more cost-effective option.

In addition to knowing where you’d want to live and how much monthly rates are for communities in that area, you’ll also want a clear understanding of what resources and assistance might be available to you.

Explore every option

When it comes to seeking financial assistance, Bedell says: “Assume nothing. Don’t assume you won’t qualify for a program. Look at everything. Make sure that you have exhausted all your options and that you understand what they are.”

There are many resources available to help older adults pay for senior living. This offers more people access to safe communities with options available for individuals who might need care. Here are just a few programs that you might qualify for.

Veterans Affairs benefits

If you’ve served in the military, the VA office is one place to look. Those housing benefits are available to both veterans and their surviving spouses. Bedell notes that VA housing assistance comes with restrictions, so it’s important to go to your local VA office or visit the VA online. They’ll have a list of all qualification requirements.

Bedell also stresses the importance of going to trusted sources and experts. She warns, “Do not go through a third-party service that promises they can get you qualified.”

Government programs

In addition to tax credits and deductions, you may qualify for Medicaid or state government assistance, depending on the state in which you live. Even if an individual doesn’t qualify, family members can take advantage of tax credits for covering memory care or assisted living costs for an elderly adult.

Long-term care insurance

You may also be able to find assistance with covering the cost of retirement living through a long-term care insurance policy. This is an area where having a trusted financial advisor can make a difference in knowing what your policy offers. “Everyone’s policy is going to be a little bit different,” Bedell says. “So, you have to understand exactly what your policy includes.”

Stay healthy and save

When it comes to planning how long you may be paying for senior living, Bedell says, “While you can’t necessarily say you’re going to live for 15 more years, you can do your best to control your health for the next 15 years. Because being as healthy as possible is the least expensive route.”

Many older adults who live alone don’t get proper nutrition, are inactive and become depressed due to isolation. Left unchecked, these circumstances can compound health issues and leave older adults no choice but to move into a more expensive community that offers a higher level of care. In fact, a study through the University of Missouri found that older adults who moved into an independent living residence while they were still in good physical health were more likely to stay independent than their peers who chose to stay at home.

That’s because retirement communities offer opportunities to socialize, remove the risks associated with routine home maintenance and provide regular meals and chances for exercise. With attentive, professional staff and thoughtful neighbors nearby, it’s also easier to catch and treat small health issues before they become serious.

Beyond the long-term savings a retirement community can provide by offering support to help avoid a need for more specialized care later, Bedell notes another cost that comes with staying at home. “A lot of individuals want to leave their children a legacy, such as a family home. But it’s important to recognize the burden that adult children take on – from providing care and meals to handling lawn maintenance and transportation to appointments – all so that a parent can stay home.” Bedell suggests considering what can be gained from leaving all those tasks to professionals, so that family time can be used to focus on sharing special moments and enjoying each other’s company.

Finding your next forever home

Before you even start looking at communities, Bedell suggests making a list of what matters most to you and what you’re willing to pay for. Do you have to be in a certain part of town? Is there a minimum apartment size you’d be comfortable in? How about access to outdoor spaces, cultural institutions or shopping?

“It’s just like house hunting,” Bedell says. “You’re looking at your options and then your Realtor® sneaks in a house $50,000 over your budget. You may love that house – but does it make sense in your long-term financial plan?”

Whether you’re ready to move into a retirement community right now or are doing research for the future, the best way to make senior living a financially good choice is to find a community where you’ll feel comfortable, welcome and financially secure.

With locations across the country, Holiday offers approachable retirement communities with all-inclusive amenities and friendly neighbors – wherever you want to be. We know the best way to experience what senior living is like is to visit. Schedule a tour at a community near you


Top Articles