For many families, benefits like maintenance-free living, convenience, abundant amenities, an active, social lifestyle, and knowing support is always at hand draw them to senior living, but it’s the cost that makes them hesitate. Some assume the cost isn’t within reach because of all senior living communities offer, while others look at the cost and their budget and think there’s no way to overcome that gap. But there are more options to fund senior living expenses than you may think. Here are some common and little-known ways to help stretch your budget.
Consider Your Current Assets
You have more ways to fund senior living at your disposal than you may realize. That’s why the most common way to fund senior living is with your current assets. See where you stand by considering these things.
● Personal income – Do you still work and/or have Social Security benefits that could help fund senior living expenses?
● Savings – Your accumulated savings can help fund senior living as well. Beyond your traditional savings account do you have Certificates of Deposit (CDs), or Money Market accounts?
● Retirement – Don’t forget about retirement accounts such as a pension, 401(k), IRAs, SEP, and/or annuities that can help as well.
● Investments – Do you have stocks, mutual funds, and/or bonds that can be converted to cash to help fund senior living? Also consider real estate, that second car, artwork, jewelry or other personal property as well.
● Your home – You might consider selling your home or even renting it to help fund senior living.
Additional Options to Fund Senior Living
These options are not as well-known, but are certainly worth considering to help fund senior living expenses.
● Veterans Aid & Attendance Benefit - Wartime veterans or a surviving spouse may be eligible to receive a non-service-connected pension (above the basic pension) to help fund senior living if you meet certain conditions including the military service, medical, and financial requirements.
● Long-Term Care (LTC) Insurance - LTC insurance can help fund senior living by covering services typically not covered by health insurance, Medicare, or Medicaid. However, it is typically necessary to be in good health to qualify and the older you are when you purchase the policy, the more expensive your premium might be. So, it’s best to plan ahead with this option.
● Life Insurance Conversion - If you have an in-force life insurance policy, you may be able to convert it into a pre-funded financial account that disburses a monthly benefit to fund senior living. Unlike life insurance, this account is a Medicaid-qualified asset.
● Reverse Mortgage - This is a type of home equity loan for homeowners 62 or older who want to access their equity to fund senior living, particularly if one of the homeowners still remains in the house. The lender makes payments to the borrower based on a percentage of accumulated equity and the loan must be repaid when the borrower dies, sells the home, or permanently moves out.
Compare Your Costs
Before assuming senior living isn’t within reach, make sure to really consider how it compares to what you’ll be paying for support and care at home. Hint: you may be surprised at what you find. First, the cost of living at home isn’t just mortgage or rent. Your total cost of living at home includes food, utilities, home maintenance, property taxes, insurance, and entertainment. It’s important to compare the total cost of living at home because those additional out-of-pocket expenses ARE typically included in the monthly cost of senior living. Second, you’ll also need to factor in the cost of at-home care and/or home modifications to your total cost of living at home. Once you’re comparing apples to apples so to speak, senior living may actually cost less!