Relocating from a home where a senior has resided for many years can be grueling. The reality of needing more assistance than is available at home can be threatening to one’s independence.
Most seniors do not want to be a burden to their adult children, but the reality is aging brings with it a need for assistance. Once a family has concluded that assisted living is the best option for their senior loved one, affordability becomes the focus. There are many options to make senior care affordable for most seniors.”
Four important question that need to be considered are:
- Where do seniors want to live?
- What is available in that vicinity in terms of assisted living?
- Can the senior afford to reside in one of these facilities?
- How long can a senior afford to live in one of these facilities?
HOW TO FINANCE SENIOR LIVING: 5 TIPS
Affordability is a reality of senior living. Luxurious living can have an extravagant price tag.
However, there are multiple strategies and options available to make senior living affordable without compromising comfort and enjoyment.
Below are five tips to making senior living an affordable venture.
- Planning to Finance Senior Living
It is not human nature to plan one’s demise. To consider and accept the aging process often goes against one’s idea of who they are and how strong they are.
“It won’t happen to me” or “It can’t happen to me” and then suddenly “Oh! It happened to me.”
The old proverb says, “Better to be wise than foolish.” It is better to plan to prepare for their senior living than to be captured by it.
Therefore, seniors should visit facilities in their community or communities where adult children reside. Understand the facilities, their amenities, the cost of leasing, and the level of care provided.
Talk with residents in these facilities while touring them and find out first-hand what it is like to reside there.
Talk with adult children about the choices you are contemplating and get their feedback.
By having these conversations and understanding what is available, the transitioning process will go much smoother and without the stress of being captured by age.
Financing senior living does not have to be an overwhelming undertaking, when residential assisted living homes provide the adequate information to help in this process. Many seniors have the capacity within their financial portfolios to finance senior living.
However, where to pull the money and how long it will last can be tricky.
- Leverage a life insurance policy.
- Determine whether you’re eligible for veterans’ benefits.
- Take out a home loan.
- Set up a reverse mortgage.
- Be Transparent About the Financial Reality
Examining a senior’s complete financial portfolio is essential. Be transparent about the status of finances.
There is no reason for shame; life happens to us all. However, when planning to afford senior living, surprises in financial portfolios are unwelcome.
Therefore, be transparent and make the best possible decision to ensure a senior’s comfort and enjoyment.
When a senior’s finances are well understood, decide the following:
- Choose an assisted living situation with a flexible pricing structure.
- All-inclusive pricing models are expensive but very convenient. They often include three meals a day, 24-hour aides, transportation, among other amenities. This model has often coined the “Cruise Ship” style.
- The less pricey model is known as “tiered pricing.” This model allocates services based upon the senior’s level of care required.
- Fee-For-Service models are typically most affordable. For instance, if a senior can drive without any concern, they do not need transportation. If the seniors can administer their medication, they do not need extra care for that. If the senior can do the majority of daily living activities unassisted, then that level of service is not necessary. Pay for what you need. It is flexible and can be changed if required, but many find it affordable to finance assisted living.
- Look for the open beds.
- When an assisted living home has a reduction in occupancy or new competitors enter the market, discounts and deals show up.
- Shop and negotiate. You might get the first month’s rent at $0 or even a monthly cost reduction for the first year. It’s possible. Just ask.
- Make sure staffing is appropriate, and the most recent survey is good. You don’t want to move into a home that has compromised care.
- Choose a not-for-profit.
- These assisted living homes are not always less expensive than for-profit entities but will sometimes have assistance available if a resident runs out of money.
- The average stay is two years, and if your senior resides in the facility for longer than that and funds become an issue, some non-profits might cover the cost.
- In some states, continuing-care retirement communities that are not-for-profit and are required to guarantee those residing longer than 2-years.
- Additionally, some assisted living homes will find ways to support financially compromised residents.
- Understand the Actual Costs of Senior Living
- In short, what’s your budget? You’ve got to know that number first. Understand the cost of living for seniors and correlate that cost to the cost of an assisted living home.
- Make sure that the costs associated with the assisted living home encompass what your senior currently gets within the budget while living at their private residence. You don’t want to pay for an assisted living home that cannot offer what your senior currently gets at home. That would result in a reduction in living quality, and enjoyment is “out of the window.”
- Afford Assisted Living: Where to Get Help
Families should consider all financial resources when deciding where to place their loved ones. Nothing should be “off the table.”
Financial resources are important decisions to take seriously.
In addition to personal financial resources, other resources are available in the marketplace:
- Elder life Credit Lines
- Tax-exempt Family Gifting
- Long-term Care Insurance
Again, consider all options and put together the best financial package to ensure your senior gets the best care possible.
- Talk to a Professional
There are several professionals at the disposal of a family deciding to enter assisted living. These professionals can be crucial to making assisted living affordable.
Consider speaking to a:
- Financial Advisor
- Geriatric Care manager
- Elder Law Attorney
- Estate Attorney
- Your local Center for Aging Agency.
The advice of these professionals can make a difference. They can give you the reality and possibilities in one conversation.
Furthermore, their market intelligence can lead you to the best options and veer you away from the worst.
MIND THE DETAILS
Families should understand that affording assisted living is possible. Equally as important is understanding that life happens, and costs can change.
The level of care for your senior may decrease, but more than likely, it will increase.
Also, incidentals arise such as:
- Pet deposits
- Car trouble
- Dry cleaning
- Culture events
Therefore, families should plan for these. Who’s going to pay if your senior’s vehicle needs repair? It will need it eventually. Who’s going to cover dry cleaning? What about pet food?
In other words, have a plan for these costs to ensure your senior has the best possible experience.
HELP WITH FINANCIAL STRATEGIES FOR SENIOR LIVING
The Residential Assisted Living Academy National Association is helping owners and operators obtain the industry tools needed to excel.
Steps such as planning for possible coverage gaps and writing off the cost of care is important need-to-know information for financing senior care.
When assisted living intake personnel understand these steps, affording assisted living becomes a possible undertaking.
Planning is vital and understanding the actual needs of your senior makes this decision a little easier.
To help seniors find quality assisted living care, the Residential Assisted Living National Association registers businesses in a home locator.
Get connected with a network that is empowering the industry by fueling businesses with useful information, group discount purchasing, newsletters and so much more at no cost.
For additional information to help families find the best way to pay for the care of their loved ones, contact www.RALNA.com.