As our loved ones age, many of us start thinking about how to care for them. And just thinking about the costs associated with assisted living is enough to cause us stress and anxiety – as if we didn’t already have enough of that, right?!!
According to Genworth, a financial organization that conducts yearly surveys of long-term care nationwide, the average cost of assisted living in the U.S. is $48,000 per year (2018). One of the first and most obvious questions you may ask yourself is, “How the heck are we going to pay for this?”
Fortunately, there are a number of options to choose from. Below are 5 ideas on ways to cut the costs associated with assisted living.
Some might seem obvious, but others, not so much. I didn’t even know about the VA option until I started researching this topic myself – and I’m a veteran!! How I wish I had known this several years ago – my father was a Korean War veteran and we could have pursued this had we known about it.
How To Cut Costs on Assisted Living Care – 5 Ways
- Veterans and spouses of veterans: If you or your spouse is an honorably discharged war veteran, you may be eligible for what is called an Aid and Attendance (“A&A”) benefit through the Veteran’s Administration. To qualify, you must be in need of assistance with daily living activities, for example, bathing, toileting, feeding, or getting dressed. You may also qualify if you are bedridden, legally blind (corrected vision of 5/200 or less), in a nursing home, and more. Income and net worth limits apply; see the VA Benefits page (benefits.va.gov) to find updated information and to learn how to apply.
- Find a facility with empty beds: Facilities with unoccupied beds are more likely to offer a discount, or negotiate fees or payments. If you have an idea that hasn’t been mentioned by the facility representative, ASK. The worst they can say is no.
- Find a facility with different tiers of pricing: Some facilities will let you pay only for what you need (“fee for service”), rather than a flat rate. This is a great option for someone who needs minimal assistance, of course. Another option might be pricing based on a set number of hours of care. A third, most expensive option is the “all-inclusive” rate which typically includes meals, transportation, and other amenities.
- Consider living arrangements: Not surprisingly, new, corporate-owned facilities usually come with higher costs. You may save on costs by sharing an apartment, or by opting for a smaller or older and more established facility. You might even get a price break on a room or apartment depending on the location within the building; those closest to desirable amenities (like a restaurant) might be priced higher than those at the other end of the building.
- Leverage home equity or life insurance: Consider applying for a cash-out mortgage refinancing; a home equity loan or line of credit may also be good options. Also, if you have whole or universal life insurance, you may be able to withdraw any or all of the contributions you’ve made over the years (referred to as a “cost basis”). Borrowing money against a life insurance policy, or cashing it out entirely, are also options to consider – although cashing it out will be subject to income tax.
Additional Information on Cutting The Costs of Assisted Living