Paying for Senior Living: Common and Lesser-Known Funding Sources
You’re concerned about your aging parents. They’re struggling at home, given their health issues. You think they’d do better in senior living – a retirement community – but you don’t see how they can pay for it.
A lot of seniors assume that life in a retirement community is beyond their means. They look at the monthly cost and don’t see how they can pay for it. And so, they don’t consider it a viable option.
The trouble is that they may not have considered all possible funding sources.
So, before they (or you) dismiss senior living as a possibility, check the following list to see whether all possible funding sources have been considered.
Paying for senior living – possible sources of funds
- Your parents’ home. What proceeds will come from the sale of their current home? If their place is rented out instead of sold, what rental income could it generate?
- Their savings. Have they put away rainy day funds in a bank account? Do they have investments like mutual funds, stocks, bonds, or annuities?
- Their income. Do they receive Social Security or a pension? Are they paid dividends from stocks?
- Veteran’s benefits. Do they qualify for or are they receiving the Aid & Attendance benefit?
- Long-term care (LTC) insurance. Do they have a policy that will pay for some costs?
- Life insurance conversion. Does it make sense for them to convert a life insurance policy into a Long-Term Care Benefit Plan that provides a monthly income?
Possible costs of not moving to senior living
As you consider how to cover the cost of senior living for your parent, you should also consider the costs of them not moving to a retirement community.
- Financial. When you consider your parents’ current living expenses at home and add to that the additional costs of providing paid care for them there, especially as their needs increase, you may discover it’s more expensive than you anticipated. In some cases, the total cost of your parents staying put with in-home services can actually exceed senior living.
- Safety. As your parents’ needs increase, their safety can become more and more of an issue. You may soon begin to wonder whether it’s worth the risk.
- Family caregiver stress. There’s bound to be someone in your family who’s been helping your parents out at home. And that someone could be you. It’s easy to minimize the contributions they make, but those contributions come at a cost to that person. Over time, they can get stretched too thin without even realizing it. Some caregivers can unexpectedly develop serious health problems of their own after a while. It’s important to not let things get that far.
For a more in-depth exploration of this topic, check out our “Family Guide to Funding Senior Care & Housing.”