Paying for Assisted Living: Costs, Financial Assistance, and Planning
Paying for assisted living is concerning for many families, and with good reason. This often unavoidable expense can have loved ones scrambling to save money, especially when they want their family members in the best care possible, receiving help with daily activities.
Depending on where a person receives assisted living, the prices can vary considerably. This is why it's so important to save for assisted living ahead of time through retirement plans, savings accounts, and life insurance policies.
This article walks you through some of the most important considerations for saving for assisted living so you're prepared ahead of time.
What Impacts the Cost of Assisted Living?
Assisted living is essential for countless older adults. When they can no longer care for themselves without care, assisted living becomes a necessity. The cost structure of retirement community pricing can be confusing, so it's important to focus on the following factors affecting the cost of assisted senior living:
Location
The location of your assisted living community affects what it costs. On average, large cities have more assisted living expenses than rural areas, so consider them when shopping around.
Type of Care
How much care you or your loved one needs affects price. If dressing, eating, and bathing are required, the price might be higher, so always ask an assisted living community these questions ahead of time.
Private or Shared Accommodation
Do you want a shared room or something private? If available and you need to save money, ask if it's possible to have shared accommodation with another resident, making new friends in the process.
Since the cost of assisted living varies greatly, create a budget ahead of time to help plan for these expenses.
Financial Assistance Options
When looking for assisted living communities near you, it's important to have different financial assistance options ready to go. Here's what you can consider with senior care costs:
Private Savings and Access to Assets
It's very common for private savings accounts and other assets to pay for assisted living. This might be the sale of a home or cash savings. No matter what type of savings a person has, they can be used for long-term care in assisted living.
However, these funds might not be enough. Other types of private savings accounts include:
Retirement Accounts
This includes a 401(k), IRA, or any type of pension that lets someone cover the expense of assisted living. Just be sure to understand the tax implications ahead of time.
Home Equity
When entering assisted living communities, a person may need to sell their home to pay for the cost. They can also take out a reverse mortgage to help pay for assisted living.
Veterans' Benefits
These benefits typically apply to Veterans and their spouses. If eligible, they can access benefits through the U.S. Department of Veterans Affairs (VA). These benefits are perfect for paying for long-term care support, especially in assisted living communities.
Aid and Attendance Benefits help Veterans and any surviving spouses who need daily assistance with completing tasks and activities. How much aid a person receives depends on how much individual support a person needs.
Planning for the Future: Starting Early
Always start early when planning for assisted living and other types of long-term care for loved ones. By having funds saved ahead of time, it can reduce financial burdens.
Since long-term care for seniors adds up quickly, financial planning for seniors helps families make the best decisions possible while managing their funds.
Consider the following:
Reevaluate Your Plan Regularly
Once you create a savings plan, evaluate it regularly. As finances and your loved one's unique needs change, your plan should, too. This gives you peace of mind knowing that your family member is cared for when they require assisted living.
Account for Potential Emergencies
You never know what might happen that requires the use of your savings, so always strive to have an emergency fund that doesn't pull from your assisted living savings accounts. When you have an emergency fund ready, it can insulate your savings accounts during emergencies.
The best thing to do is set long-term savings goals and stick to them, setting money aside weekly or even monthly.
Understanding Costs and Budgeting
Budgets are among the most important aspects of paying for assisted living communities. Understand ahead of time what assisted living will cost monthly and annually so you're prepared for it.
Keep in mind that the cost of assisted living is often more expensive than just basic care. This means you'll need to pay for additional expenses, like:
- Specialized care
- Transportation
- Personal items
Depending on your loved one's unique needs, there may be other expenses you need to budget for. You should also consider if meal plans and housekeeping services are covered with the standard fees or if these amenities are extras. Additionally, don't forget to factor in inflation, working to sidestep any type of financial surprises down the road.
You can also consider specific life insurance companies that may allow older adults to access funds ahead of time, but these may be expensive, so always get several estimates.
Factor In Extra Costs for Specialized Care
Additional expenses may accompany changes in medical care. This includes geriatric physical therapy, occupational therapy, and more. This can increase the total cost of assisted living, so always leave padding for additional expenses for specialized care.
Consider Geographic Differences
The cost of assisted living often varies by location. Communities in rural areas are usually more affordable than communities in more densely populated urban areas.
Always research the cost of different assisted living communities by area and find the best one for your financial needs, ensuring it also offers your loved one top-notch long-term care.
Paying for Assisted Living: Available Options
Paying for assisted living requires a good deal of careful planning in advance but when you have a plan, stick to it as best as possible. Consider what your loved ones might need help with and how this affects the cost of assisted living and create private accounts to help manage these expenses to reduce overall stress.
Discovery Commons Orland Park offers assisted senior living options for older adults. We value our expansive amenities and activities, keeping all residents engaged. Contact us today for a tour of our available floor plans, to discuss pricing, and to learn more about our vibrant activity calendar.