How Much Does Assisted Living Cost And How To Pay For It

Shawn Plummer

CEO, The Annuity Expert

Assisted Living Cost Calculator

As of 2023, the average cost of an assisted living facility in the United States varied widely depending on the location, the level of care required, and the amenities provided by the facility. Generally, the cost ranged from approximately $2,500 to $7,000 per month, with a national average of around $4,000 to $5,000 per month.

How to Pay For Assisted Living

Paying for an assisted living facility can involve a variety of methods and sources. The most common ways include:

  1. Personal Savings and Retirement Funds: Many individuals use their personal savings, retirement accounts like 401(k)s or IRAs, or pension income to pay for assisted living.
  2. Selling or Renting Real Estate: Selling a home or other real estate can provide a significant source of funds. Alternatively, renting out a property can generate ongoing income to help cover costs.
  3. Long-Term Care Insurance: This type of insurance is specifically designed to cover long-term care costs, including assisted living. It’s important to review the policy details to understand what is covered.
  4. Long-Term Care Annuities: Doubles or triples a person’s investment to pay for assisted living expenses, typically tax-free.
  5. Life Insurance Policies: Some life insurance policies have a cash value that can be withdrawn or borrowed against. Also, there are life settlement options where the policy is sold for a lump sum.
  6. Veterans Benefits: Veterans and their spouses might be eligible for benefits through the Department of Veterans Affairs (VA), such as the Aid and Attendance benefit, which can help cover assisted living expenses.
  7. Reverse Mortgages: For homeowners, a reverse mortgage allows them to convert part of the equity in their home into cash without having to sell the home.
  8. Government Assistance Programs: While Medicare generally does not cover the cost of assisted living, Medicaid might provide assistance for eligible individuals, though this varies by state.
  9. Bridge Loans: Short-term bridge loans are designed to provide temporary funding while waiting for other funds to become available (like selling a home).
  10. Annuities: Some individuals use annuities, which provide regular payments over a set period of time, to fund their assisted living expenses.
  11. Family Support: Often, family members contribute financially to assist with the costs of an elder’s assisted living.
  12. Community and Nonprofit Programs: Some local community organizations or nonprofit groups offer financial assistance or subsidized housing options for seniors.
  13. Assisted Living Loans: Some financial institutions offer loans specifically for financing assisted living and other long-term care needs.
Assisted Living Cost

What is Assisted Living?

Assisted living facilities are residential communities offering a blend of independence, community, and care. They cater to seniors who need assistance with daily activities like bathing, dressing, and medication management but don’t require the intensive care a nursing home provides.

How Does Assisted Living Work?

Assisted living provides a supportive and safe environment for seniors who need assistance with everyday activities such as bathing, medication management, and meal preparation. Residents live in private or shared apartments and receive personalized care according to their needs. Trained staff members are available 24/7 to provide assistance and ensure their well-being.

Assisted Living vs Nursing Home

Assisted living and nursing homes cater to different levels of care for seniors. Assisted living offers help with daily activities like bathing and medication management, while nursing homes provide on-site medical care and supervision for those with more complex health issues. The choice between the two depends on the individual’s specific needs and preferences.

  • Assisted Living: Focuses on personal care in a home-like setting.
  • Nursing Home: Provides more comprehensive medical care and constant supervision.
What Is Assisted Living

Costs and Payment Options

Helpful Tip: Assisted living insurance

Financial Challenges

Many wonder how to afford assisted living, especially on a limited income like Social Security. Consider options like long-term care insurance, veterans’ benefits, and Medicaid (if eligible). For those with no funds, some states offer Medicaid programs, and non-profit organizations might provide assistance.

Assisted Living Facility

Choosing the Right Facility

  • Location: Proximity to family and medical facilities.
  • Services: Check for the specific services needed.
  • Cost: Understand all included and additional costs.
  • Atmosphere: Visit to gauge the environment and staff.
Types Of Assisted Living Facilities

Comparing Assisted Living Costs by State

StateAverage Monthly Cost
California$4,500
Texas$3,750
Florida$3,500
New York$4,100
Ohio$4,000

Conclusion

Assisted living offers a valuable solution for seniors needing assistance with daily activities but desiring to maintain some independence. Understanding the differences between assisted living and nursing homes, the costs involved, and the payment options available are crucial in making an informed decision. Remember, every situation is unique, so it’s important to assess your personal needs and financial situation. For more detailed information or to explore options that best fit your needs, contact us today for a free quote.

Request A Quote

Get help or a quote from a licensed financial professional. This service is free of charge.

Contact Us
First
Last

FAQ About Assisted Living Homes

How does assisted living work financially?

Assisted living works financially through a combination of personal funds, long-term care insurance, and government programs like Medicaid. Residents typically pay a monthly fee for housing, meals, and services. Additional costs may apply for extra care or amenities. Some individuals may qualify for financial assistance based on their income and assets.

Who pays for assisted living?

Assisted living is generally paid for by the individual receiving care. Costs are typically covered through personal savings, retirement funds, or long-term care insurance. Some seniors may qualify for financial assistance programs like Medicaid or veteran benefits. It is advisable to consult with a financial planner or elder law attorney to explore available options for funding assisted living.

Does Medicare cover assisted living?

Generally, no. Medicare does not cover the costs of assisted living.

What is an assisted living facility?

A facility offering residential care with daily personal assistance and social activities.

Does insurance cover assisted living?

Some long-term care insurance plans will cover it, but not standard health insurance.

Does long-term care insurance cover assisted living?

Yes, many long-term care insurance policies cover assisted living costs.

Does social security pay for assisted living?

Partially, but usually insufficient to cover the full cost.

Does Medicare cover assisted living costs?

No, Medicare does not usually cover assisted living expenses.

What is the difference between assisted living and residential care?

Assisted living offers more comprehensive support and services than residential care.

Shawn Plummer

CEO, The Annuity Expert

Shawn Plummer is a licensed financial professional, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

Scroll to Top