Making the decision to move into an assisted living community can be a significant change, but it is often an essential step towards ensuring your own or your senior loved one’s well-being. However, the costs associated with assisted living, which average around $4,500 per month depending on the location of the assisted living community, can be a significant financial burden for many families. In this comprehensive guide, we will explore different ways to pay for assisted living and provide information on available resources that can ease the financial strain. To learn more, keep reading below or reach out to the Sunbound team for more information. 

Understanding the Costs of Assisted Living

When considering assisted living for a senior parent, it is crucial to understand the various factors that contribute to the overall costs. These factors may include: the location of the facility, the length of stay, the type of accommodations (e.g., private or shared room) and the services and amenities offered. Another large factor in the ultimate cost of assisted living will be the level of care required for yourself or your senior loved one. Memory care, for instance, can add an additional $800-$1,200 per month to the overall cost. With the average length of stay in an assisted living community at around 2.5-3 years, it’s essential to plan and budget accordingly.

Are Assisted Living Costs All-Inclusive?

Most assisted living communities offer an all-inclusive monthly fee that covers things like accommodations, utilities, meals, transportation, activities and senior care. However, there may be some additional costs for specific services or amenities, such as specialized activities, groceries, or skilled nursing care. And while senior health care services will generally be included in the same monthly bill, these may change each month as a senior requires more or less care from month to month. It is essential to carefully review the payment structure and included services of each assisted living facility to ensure it meets the needs and budget of your senior parent.

10 Ways to Pay for Assisted Living

Medicaid: Medicaid is a state-regulated program that may cover some medical aspects of care provided in an assisted living facility. Although it does not typically cover room and board costs, it may help cover medical expenses, such as skilled nursing services or rehabilitative therapies.

‍Medicare: Medicare is a federal health insurance program that generally does not cover long-term care services. However, it may be used to cover some healthcare costs associated with assisted living, such as medication management or coordination with healthcare providers.

Long-term Care Insurance: Long-term care insurance is a private insurance policy that covers the costs of elder care, including assisted living. Premium prices and coverage options vary greatly, so it is essential to review and compare policies carefully.

‍Veterans' Aid: Eligible wartime veterans and their surviving spouses may qualify for a pension program through the Department of Veterans Affairs (VA) to offset the cost of senior care. This benefit, called Aid and Attendance, can provide up to $2,200 a month for a veteran and their spouse or up to $1,900 a month for a veteran without a dependent.

Life Insurance Settlement: A life insurance settlement involves selling an existing life insurance policy to a third party for cash. This cash can then be used to fund a long-term care benefit plan, such as assisted living expenses.

Home Equity: Seniors who own their homes may leverage their home equity to help cover assisted living costs. This can be done through options such as bridge loans, reverse mortgages, or selling or renting the property.

‍Annuity Income: An annuity is a contract between a person and an insurance company that provides a steady stream of income during retirement. This income can be used to pay for assisted living and other long-term care services.

Bridge Loan: A bridge loan is a short-term loan that can be used to temporarily fund assisted living costs while other financial resources are being secured, such as selling a home or waiting for insurance benefits to begin.

State Assistance Programs: Many states offer assistance programs for seniors who need help with assisted living costs. These programs vary by state and may have specific eligibility requirements.

Private Funding Through the Senior Living Facility: Some assisted living facilities offer their own private funding options for residents. Inquire with individual facilities to see if this is an option they provide.

Tips for budgeting for assisted living

Once you have determined your own or your senior parent's available resources, it is crucial to strategize and plan for managing the costs of assisted living. Here are seven tips to help maximize your assisted living budget:

Inquire about price flexibility and specials: Some facilities may offer discounts or special promotions during specific times of the year or to fill vacancies.

Compare a la carte costs with inclusive pricing: Evaluate the benefits of all-inclusive pricing versus paying for services individually based on need.

Consider a roommate: Sharing a room in an assisted living facility may be more cost-effective and potentially provide companionship for your senior parent. In fact, studies have shown that companion living can have powerful wellness benefits for seniors in assisted living and memory care.

Enroll in discount programs for low-income seniors: Programs such as the National Council on Aging's BenefitsCheckUp can help eligible seniors save on essential expenses, freeing up funds for assisted living costs.

Save on moving expenses: Hiring a senior move manager can help with downsizing and transition costs, and potentially provide guidance on selling possessions to cover assisted living expenses. Hiring a senior move manager can often pay for itself by making your or your senior loved one’s move as easy and efficient as possible, saving countless hours of extra work and frustration. 

Explore tax credits and deductions: For example, seniors who meet the IRS' definition of "chronically ill" and relatives who pay for at least 50% of their care may be eligible for tax credits or deductions. As always, make sure to check with a financial planner or elder law attorney if you or your senior loved one plan on taking any age-related tax deductions. 

Utilize assisted living resources: Resources like Sunbound’s Medicaid Financing Program can provide valuable guidance and support in finding affordable senior living options, as well as assistance in making monthly payments. 

Paying for assisted living can be a complex and challenging process, but with proper planning and consideration of all available resources, it is possible to find a solution that meets both the needs and budget of your senior parent. By exploring various payment options, seeking financial assistance, and implementing cost-saving strategies, families can ensure their loved ones receive the high-quality care and support they deserve in their golden years.

To learn more about how Sunbound can help make senior living more affordable for you or your loved one, send us an email at info@sunboundhomes.com or request more information on Sunbound. Sunbound is the best way to pay for senior living and is on a mission to make senior living affordable for everyone.