Strategies for Saving Money for Long-Term Care or Paying for Assisted Living

Whether you’re looking for yourself, a parent or another loved one, planning for senior living or assisted living care can be overwhelming and expensive. The average cost of care per month, depending on location, amenities, type of care, etc., can be a shock for most people no matter what financial status they have. 

There are so many things to consider, but figuring out what kind of care you need along with your budget is a necessary first step. It’s ok to feel a little anxious about all of this because the first step always seems the hardest.

Once you sit down and begin planning and preparing financially for senior living or assisted living care, it will help remove some of that anxiety or pressure that you have been feeling. Trust us. 

Deciding to move into an assisted living community is a huge decision, and yes, we understand all of the moving parts that come along with that. Finances are one place to start. We know it can be a chore to wade through the cost of assisted living and wondering how you will be able to afford any type of assisted living facility.

That’s why we want to help make this as easy as possible for you and your loved one. 

Here are some frequently asked questions many people have when it comes to living in an assisted living facility and preparing for the cost of assisted living.

FAQS

How much does assisted living care cost? 

There isn’t an exact answer to this question because it depends on the amount of care and type of care families need. Each state is different in terms of the average cost of living.

Of course, there are many things that factor into these costs so the first step is figuring out what you want and more importantly what type of care you need.

Can I use long-term care insurance to pay for assisted living? 

Yes, you can. Premiums will be determined upon your condition as with any insurance company but this is an option.

Can I use a life insurance policy to pay for assisted living? 

Yes. Cashing out your life insurance policy is an option to help pay for assisted living facilities. 

Can Medicaid or Medicare be used to pay for assisted living care? 

Medicaid can be used to pay for assisted living, but Medicare can not. With Medicaid, there are some restrictions in terms of how you use it for assisted living but in general yes, it can be used to pay for the cost of assisted living. 

These questions are pretty common for anyone weighing the costs of assisted living facilities and yes, it’s a lot of information. So, we’ve put together some resources to help provide some insight on how assisted living care can be affordable to you and your family.

11 Financial Strategies to Afford the Assisted Living Care You Need

Review Your Benefits to Save on Assisted Living Costs

Did you know that over 2,500 federal, state, and private benefits programs exist to help seniors with financial benefits? Having a good grasp on the types of things you can save money on will help you apply it elsewhere when needed.

Checking in on things you can save on such as food, housing, transportation, and medication is a smart way to not only financially plan ahead but and save ahead.

One amazing resource we found helps seniors check their benefits absolutely free. Take advantage of this tool and start saving for the possibility of assisted living immediately.

Put Social Security Income Toward Assisted Living

At the age of 62, individuals may start collecting social security. Typically this income alone is not enough to fully cover assisted living expenses, it certainly provides support when you need it.

Use Personal Savings to Help Afford Assisted Living

Most people afford assisted living facilities through a combination of incomes or savings and this includes private money you have saved throughout your years.

Whether this is part of your official retirement plan, your 401K or other means of investments, private savings play a large role in preparing for the possibility of assisted living or long-term care.

Don’t overlook how important saving money can be for your future, financial security, and quality of life.

Medicaid Can Be Used to Help Pay for the Cost of Assisted Living

This program jointly funded on the state and federal levels help cover healthcare costs and long-term care for seniors. Not to be confused with Medicare, which does not cover any type of long-term housing or care, Medicaid can be utilized in 44 of the 50 states to cover assisted living costs.

Although Medicaid doesn’t directly cover room and board for assisted living, the state has a way to work around that in order to successfully help each eligible individual get the most out of their benefits.

Similar to Medicare, each state does have its own regulations and guidelines with Medicaid so make sure you are eligible.

Apply for Veterans Benefits to Help Pay for Assisted Living

Health care coverage and other medical services for a veteran are typical benefits associated with government programs like the U.S. Department of Veterans Affairs. These of course can be used to help seniors save money on health care costs and enable them to save for other things like housing.

However, a veteran can also be eligible for other government programs like VA pensions. These are awarded as monthly monetary supplements to the veteran and can be used however they see fit. Because it is served as a supplement to help with income, the veteran does have to show they are in financial need.

Use a Life Insurance Policy to Help Pay for Assisted Living Costs

 If you have a life insurance policy that you’ve been paying premiums on for quite some time, this could be a perfect option for you. Of course, you would have to decide if leaving less money behind for those you love would be ok, but ultimately the pay-out for cashing in your policy could help out in a big way.

Use a Reverse Mortgage to Pay for Assisted Living Costs

Although this could be a risky approach, it is an option, and it’s not a bad option. This option is potentially the best if a loved one or family member is still living and remains in the home while the other one enters into assisted living or long-term care.

Individuals who own their homes and are 62 years or older may take out a reverse mortgage and borrow up to 74% of the home’s value.

This of course could be a great benefit, however, there are still lots of financial obligations to uphold. The continuation of property taxes, insurance and there are even closing cost fees that still loom large.

This could be a viable option, but that’s just the word we’ll use ‘option’. Remember to always weigh the pros and cons before making a huge financial decision about assisted living or future care for you or your loved one.

Opt into Long Term Care Insurance to Help Pay for Assisted Living

This type of insurance ensures you would be able to afford long-term care or assisted living should you need it in the future. Purchased through private insurance companies, long-term care insurance is a good option for many seniors.

As with any insurance company, the premium costs depend on many factors such as health, age, and the amount of coverage.

If you have a pre-existing condition, this would not be the option for you or your family when considering assisted living costs because long-term care insurance companies usually deny coverage.

Use Annuity Income to Pay for Assisted Living Services

An annuity agreement swaps out a lump sum payment from an individual for a guaranteed cash flow for a certain period of time. After a series of premiums or one premium is paid, the income could begin immediately or at a later date.

As with everything there are pros and cons, so make sure to ask your financial planner or insurance provider about annuity before making any decisions about assisted living.

Take Out a Loan to Help Pay For Assisted Living Costs

Taking out a loan can often be seen as risky, but a short-term Bridge loan might be a good option. These are called Bridge loans because they bridge the financial gap in the case of emergencies.

Many seniors elect to use the sale of their homes, for example, to help pay for assisted living, but if their house doesn’t end up selling immediately and they need money for care, the Bridge loan helps fill that need.

Select Tiered Assisted Living Facilities to Help Control Costs

Many assisted living facilities are all-inclusive facilities that require all-inclusive payments. Then you’re often hit with additional hidden fees for housekeeping, laundry and other services.

However, at StoneBridge Senior Living, we have levels of care that include tiered financial packages. When a family is considering assisted living options, we pride ourselves on having no hidden fees and being very transparent with our prices and clearly outlining any additional costs.

Selecting a senior care community with tiered packages can help make it easier to afford assisted living care.

Making a Decision to Pay for Assisted Living 

Information is power, so now that you have this information in your hands, take the time to weigh your care options. The decision you make concerning paying for assisted living isn’t a light one. This is our business, so we know exactly how much weight this decision holds.

Here at StoneBridge, we want to help be a solution and help answer any of your questions concerning financial obligations and what that looks like for you and your family. 

Whether you’re looking for nursing home care, assisted living, or something in between, we’ll outline the cost of living options within our facility and point you in the right direction.

Please feel free to contact us and a StoneBridge Senior Living advisor will be happy to speak with you concerning any questions about assisted living you may have.