Senior living communities offer older adults a variety of benefits, services, and amenities. When you add them all up, it’s easier to understand how moving to a retirement community can be a smart financial decision.
Older adults considering this type of move often have many questions—from how much an assisted living community costs to whether or not Medicare covers these costs. Understanding the ins and outs of how to finance senior living can be confusing.
This quick guide will help you understand the options for financing senior living.
Funding for Assisted Living Costs
Unfortunately, Medicare does not help pay for any assisted living costs. While some states do have Medicaid waiver programs, not all communities accept them. Private family funding comprises the majority of financing, but there are other funding sources to consider.
From veterans assistance programs to bridge loans specifically for senior housing, here’s a few of the funding options your loved one may qualify for:
Veterans Aid & Attendance Benefit
One potential and underutilized source to help finance assisted living is the Veterans Aid & Attendance benefit. It can help pay a veteran’s expenses and those of their spouse. If a veteran meets the requirements, the awards can be significant.
Currently, a veteran or their spouse might receive up to:
- Married Veteran: $2,230 per month
- Single Veteran: $1,881 per month
- Surviving Spouse: $1,209 per month
For more information, visit the “Pension” page on the US Department of Veterans Affairs website.
Short-term Bridge Loans
For many people, a home is their greatest asset. Proceeds from the sale of a senior’s home are often needed to help pay for assisted living costs. But downsizing and preparing a house to sell can add to the stress of moving to an assisted living community.
Relocating before selling the home can relieve an older adult of some of the anxiety and stress that accompanies moving. A short-term bridge loan can be used to help finance the transition.
These types of loans help seniors finance assisted living expenses while their home is being readied for listing with a realtor. It can also provide short-term funds if you need to wait for a more opportune time for investments to be liquidated. Once the house or investment is sold, the bridge loan can be paid off.
Life Settlement Companies
Another option many seniors aren’t familiar with is selling an unneeded life insurance policy to a life settlement company. A senior sells their life insurance policy to a third party and receives a lump sum payment in return. While the reimbursement doesn’t equal the full face value of the policy, it is typically much higher than the policy’s cash surrender value.
Make sure you thoroughly investigate any life settlement company you are considering. You may also want to have an experienced elder care attorney review the contract before signing it.
Long-term Care Insurance
Some long-term care insurance policies also help pay for in-home care expenses and assisted living costs. Don’t make the mistake of assuming these policies only cover nursing homes. Check your senior loved one’s policy or contact their insurance agent for clarification.
Questions about Funding Options for Senior Living?
If you have questions about elderly care or need assistance finding a care solution, we’ll be happy to help! Call 888-514-6461to talk with a local care advisor for free!