What You Need to Know When Financing Senior Assisted Living

When navigating the complex financing system of senior living, it’s ideal to talk to an expert, like senior living advisors. They can help uncover and maximize all income sources for paying for care. You can also get involved by learning on your own. If you’re an adult child helping a senior relative move to assisted living, where do you start? Read on to find out five key points you need to know about financing options to assist your senior mom or dad in making better senior living decisions.

Family Caregivers on Financing Assisted Living

Many informal caregivers end up with depleted savings as they financially support their senior parents with assisted living costs. This usually happens to families with senior members who don’t have a solid financial management plan before retirement. Eventually, family caregivers, who are often adult children, spiral into stress from exhausting their emergency and life savings to pay for their senior parent’s care expenses.

You can prevent this distressing situation if you plan and prepare to finance your parents' care needs. Months prior to their move to assisted living, sit down and discuss financial matters with them. If you expect their assisted living stay for a couple of years, talk about where to get resources to pay and options where you can save.

Here are five things you should be discussing with your senior parents about their living care needs.

1. Determine the ideal senior living option.

Assisted living communities categorize residents based on the level of care needs. Capable seniors choose independent living, while those requiring minor assistance with personal care opt for assisted living. Older adults with dementia or Alzheimer’s live in the memory care unit, usually located in a separate building or wing.

First, you need to evaluate the care demands of your loved one. Does your mom require 24-hour care and supervision? If so, she might need assisted or memory care services. But if she can perform activities of daily living without any help, independent living is the best choice. It costs less than assisted living, so financing may be more manageable.

Know what senior lifestyle best suits your loved one as costs depend on how much care is needed.

2. Estimate the costs for long-term care.

When you know the approximate associated cost with assisted living support, you can plan your finances better. It may also give you opportunities to save some dollars.

Seniors move into assisted living for both short- and long-term reasons. Some may stay in a facility for a few months to recuperate from surgery, while others relocate there for years. Since communities now offer rehabilitation support, it’s possible to stay for a few months. It eliminates cooking and housekeeping responsibilities for those who have had surgery. Based on the recent senior living report by Caring.com, the average monthly costs for independent, assisted, and memory care in Texas are $2,371, $3,348, and $4,766, respectively.

With these figures as a baseline, you can roughly calculate how much it will cost your family based on the length of stay. You can plan a budget around it.

3. Know what services cover the monthly fee.

Some communities offer all-inclusive services for one monthly fee. This includes using all community amenities, home maintenance services, and 24/7 care support. Others offer a la carte payments for particular services, such as transportation, housekeeping, and laundry.

Know what services cover the monthly fee to get better deals. Does it include three meals per day? How about housekeeping services and utility fees? Ask the community administrators what kind of services your loved one can access every month and determine if they need or don’t need these services.

For example, if you can visit and help with weekly housekeeping, a la carte or per-service payment is a better choice. There may also be add-on services, like transportation and laundry, that you don’t need to sign up for if you or another family member can take over these tasks.

Additional saving tip: Ask the community staff during your tour if they have move-in incentives, special offers, or discounts for lump-sum payments. If they do, that’s a few hundred dollars savings!

4. Know your care payment options.

Generally, senior housing services are paid for through private funding using cash, business income, savings, pension, and other personal assets.

Another great option is Medicaid. Seniors may receive funds to pay for care expenses while living in a community, which is subject to state regulations. Some states have programs that pay for personal care, homemaker, and transportation services. In Texas, Medicaid pays for all expenses incurred while a senior is in an assisted living facility.

Another option is the Veterans Aid & Attendance & Housebound Benefits. It covers a fraction of care spending in residential facilities, but it’s subject to eligibility.

Other financial sources for long-term care include cash-value life insurance and long-term care policies.

Knowing your financing options allows you to stretch every dollar to sustain care living expenses.

5. Connect with experts who can help you navigate financing options.

Talk to a senior living advisor and community staff to get more ideas about financing lifestyle options. Public benefits counselors can also offer financial advice for free. They can help you understand and explore different sources of paying for care.

If you need help with financial planning, you can consult with:

1. Geriatric care managers (GCMs)

2. Eldercare resource planners (ERPs)

3. Elderlaw Attorneys

Financial planning is essential for many reasons. For older people, it supports their retirement and independence and improves their standard way of living. If your senior parents have business and other existing assets, ensure you get advice on using them appropriately and maximizing their benefits.

Financial Understanding is Key in Making Better Senior Living Decisions

The lack of education on financing long-term care costs is why many family caregivers experience financial and emotional strain. Besides unpaid care services, they also spend an average of $7,242 per year to cover caregiving expenses for their loved ones.

To minimize financial issues, a good jumping-off point is to learn your options besides personal assets. Your loved one may have insurance policies, Medicaid, and other government benefits that may help cover a fraction of the care costs. Reach out to a senior living advisor or financial planner to gain a better understanding of your family’s financial situation.

Syed Rizvi

Syed has years of experience dealing with people, understanding their needs, and helping them find solutions to their problems.
As a Certified Senior Advisor (CSA), Certified Dementia Practitioner (CDP), Certified Montessori Dementia Care Professional (CMDCP), Syed is committed to working closely with Senior and their family knowing what is it like for individuals facing a challenging time, at times groping in dark trying to figure what is the appropriate next step or care level for their unique situation.
Syed and Senex Memory Advisors are fully committed to working closely with families in creating a personalized, step-by-step process memory care plan at zero cost.