Although roughly 90 percent of seniors say they want to age in place, staying at home can be a pricey and stressful undertaking that ultimately produces a lower-quality retirement and immense family stress.
Senior assisted living offers many more amenities than you or your loved one can get at home, including healthy gourmet food at every meal, tons of activities, and a gorgeous home you’re proud to call your own. However, many families think that the cost of senior living is too expensive to even consider.
Prices vary from region to region, and they depend heavily on the services you or your loved one needs. The truth is that for many seniors, long-term assisted living actually offers significant cost savings and a better value compared to staying at home.
Average Pricing for Senior Living
There is no true “average” senior living price tag. What you pay depends on a myriad of factors, including:
- Community amenities: Better, more luxurious communities typically charge more.
- Type and extent of care needed: More extensive support, such as in a dementia care community, carries a higher price tag.
- Geographic location: The cost of assisted living is loosely tied to local cost of living. You’ll pay a lot more for care in New York City than in Blue Springs, Missouri.
Nationwide, the average assisted living community carries A PRICE TAG OF ROUGHLY $4,500 PER MONTH. This figure is enough to give any family sticker shock, but it’s important to consider that you’ll be saving a lot by shifting to senior living. An in-home health aide is actually a pricier option—averaging about $5,000 per month—that doesn’t offer any of the amenities you’ll get in senior living.
Additionally, if your loved one moves out of their home, they’ll no longer bear the significant costs of home upkeep. They may even be able to sell their home to fund all or a portion of senior community living costs.
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Paying for Long-Term Assisted Senior Living
Senior living is “all inclusive” in that the monthly price tag includes things that your loved one was paying at home, like mortgage or rent, utilities, and lawn work. Depending on the community, most of these things can be covered under a single price tag, so you or your loved one never again have to worry about surprise expenses like a leaky roof or broken pipes. In many cases, you also won’t have to budget for groceries, for activities and entertainment. That offers not only significant cost savings, but a lot of financial reassurance.
Important Note: Remember, costs of senior living can go up as the resident’s needs change, so that “all inclusive” number isn’t set in stone forever.
You don’t have to be wealthy, or even have a lot of savings, to access the benefits of a high-quality senior living community. Here are some options for funding senior living:
Medicare and Medicaid
Medicare will not pay for long-term senior care, but for some communities, Medicaid will. Seniors of modest means are eligible for Medicaid. Someone may qualify as “medically needy” if they have complex long-term medical needs, which can fast-track Medicaid eligibility. Although Medicaid isn’t a sure-fire answer, it’s possible that it can help seniors of modest means. (In other words—it’s worth checking out.)
Important Note: Medicaid rules and regulations vary (often widely) by state, and every senior living community has their own payment policies.
Long-Term Care Insurance
It’s important to check the specific terms of your policy, but long-term care insurance is designed specifically for seniors who need long-term care, such as in an assisted living community. Your policy may cover the full cost, or at least a significant portion of it.
Some VA programs and veterans benefit packages will cover all or a portion of long-term care.
Social Security and Disability Benefits
Social Security benefits recipients get a small monthly stipend to fund a portion of long-term care costs. Similarly, disability benefits recipients may also get help funding their care expenses.
Some life insurance policies allow you to cash out the policy before your death. Doing so can help fund long-term care.
Strategies for Reducing the Costs of Senior Living
Although many policies and benefits packages can cover long-term care, not everyone has access to these options. Don’t despair! Even without a hefty savings account or insurance benefit, you may still be able to afford the care you or your loved one needs. There are plenty of options for reducing costs, including the following:
Selling a Home or Other Property
If you or your loved one are moving to long-term care, you can greatly reduce monthly expenses by selling a home or other property. The proceeds from the sale can help fund your long-term expenses, and potentially even pad a savings account. For most people, selling the home is enough to fund the full costs of a senior living community, or at least many years of care.
Pooling Money Together
Families can come together to pool their money and help fund care. Some even use a GoFundMe or similar fundraising options to raise additional money.
Dipping into a Retirement Savings Account
Retirement savings is for retirement, after all. So cash it out to help pay for the retirement you or your loved one deserves.
Choosing More Affordable Senior Living Options
Shaving a few hundred dollars off of your monthly budget can add up to thousands in savings, over time. You or your loved one could try sharing accommodations at the senior living community of your choice. Your loved one’s occupancy fee will be based on their needs, and will likely be much lower than the community’s base rate.
The Costs of Not Choosing Senior Living
It’s easy to fixate on the senior living price tag, and compare that to no expenses at all. But that’s not a fair comparison, because living at home carries significant costs—financial and personal.
Some of the financial costs you’ll bear include the following:
Paying for In-Home Aides
If and when you or your loved one needs in-home aides, the expense can add up to thousands of dollars per month. It often costs significantly more than senior living, while offering fewer amenities and less support.
The Cost of Maintaining a Home
This may include rent or a mortgage, utilities, repairs, property taxes, and much more. If the senior in need of care moves in with another family member, they’ll incur expenses selling their home and likely add significantly to the family member’s monthly expenses.
Daily Living Expenses
Retirement can get expensive, especially if you’re enjoying it! Movie tickets, concerts, and other entertainment are not cheap. Add in groceries, gas, travel, and other expenditures, and you may be shocked how much it costs just to enjoy life a little.
Health Risks and Expenses
Moving to a senior living community may help improve certain health conditions by offering better nutrition and more exercise. Emergency help is on-hand when it’s needed, and the concern about injury and falls may be less of a concern. Living at home can be immensely lonely, and that loneliness is more than an inconvenience. Isolation poses a serious long-term threat to health, and can even increase the risk of diseases like Alzheimer’s and heart failure.
Lost Wages and Income for Family Caregivers
Family caregivers spend an average of $7,000 per year of their own money to care for loved ones. They may also lose career and income opportunities, have to pay more for childcare, or need to fund mental health support to manage the challenges of caregiving.
The emotional toll of not choosing a senior living community option can also be immense. It includes the following:
An Inadequate Lifestyle for Seniors
No single caregiver can provide the level of care you would get in a senior community. Even with multiple in-home aides, it’s just not possible to get the sort of gourmet dining, endless entertainment, and socialization that comes effortlessly with the right senior living community.
Caregiver Stress and Burnout
Caregiving is physically and emotionally taxing work. It often means giving up time with children or spouses, compromising long-term goals, and losing opportunities at work. Almost half of caregivers show signs of depression.
Families are complex animals, and disagreements over caregiving decisions are inevitable.
Make the Most of Retirement
Cedarhurst is committed to compassionate, engaged care that meets seniors where they are. We can help you make the most of retirement for you or your loved one, with plenty of activities, support when you need it, and a deep respect for our residents’ independence and values.
To learn more, and for help budgeting for senior care, check out our free guide The Insider’s Guide to Understanding Assisted Living Pricing.
This post was originally published in May 2021 and updated in November 2022.