If you have been looking into retirement options for your loved ones, you’ll quickly find out that they’re spoilt for choice! While considering your options, it’s likely that you’re also wondering about cost. Here, we’ve compiled some questions families frequently ask about financing senior living.
How Much does Senior Living Cost?
Figuring out how much senior living really costs is as good a place to start as any. Monthly fees for assisted living across the United State average out to around $3, 628, but – as with anything – the exact cost is dependent on a variety of factors. These factors include:
- The type of senior living option you pick. Senior living options can include independent living, memory care, and assisted living.
- Location. Some areas of the country may be more expensive than others, and you might find variance in prices even within the same area.
- Amenities can also influence the overall cost of your senior living option.
It can also be helpful to note that many senior living options provide customizable services and support. Residents can opt in and out of certain services, which in turn influences how much they have to pay.
How to Pay for Senior Living?
If you have chosen to sell your loved one’s home so that they can move to a senior living community, a bridge loan can tide you over until the sale goes through.
If your loved one is a veteran, check if they are eligible for a VA pension. The pension might include benefits that can help cover the cost of assisted living. To check if your loved one is eligible for this, contact your nearest office of the United States Department of Veterans Affairs and inquire about the Aid and Attendance Program to start.
Can Life Insurance Pay for Senior Living?
It is always best to check with your provider or your family lawyer, but you can consider what is known as a “life settlement”. This is a lump sum that can be used to pay for home improvements, at-home care or senior living. There are no restrictions on how the funds are used, your loved one will not have to make premium payments and there may be tax deductions available if they use them to pay for long-term care. These life settlements can also cover up to seven times their cash surrender value.
However, using a life settlement comes with some drawbacks. It is possible that using one will disqualify your loved one from Medicaid, and the settlement can be taxable as a capital gain and the death benefit will be transferred to the new policy owner. It is also possible that your loved one may have to pay a broker fee and undergo a medical exam.
For these reasons, we highly recommend doing thorough research on this, ideally with the help of a trusted professional. As your loved one enters their golden years, they deserve to enjoy a relaxing and refreshing lifestyle, and you want to be free of financial stress as much as possible.
