How Can You Pay for Assisted Living Care?

Assisted living can potentially be a positive lifestyle transition for seniors as they go through the aging process. Moving into these communities can be a relief from the stress of living alone and the responsibility of maintaining a home as you age. Additionally, it can be an opportunity to enjoy social activities in a community designed for people of the same age group who often share similar interests.

However, a major concern for people who are considering making this transition is how they will pay for the comforts of senior living such as apartments and retirement communities. And especially in today's tough economy, these are important money questions that every family should be considering. Here are a few ways people are finding ways to pay for senior care:

Option #1: Self Funded

Self funding means simply paying out of pocket, as many people are able to rely on their own resources to cover the costs of these communities. Options include savings accounts and investments, insurance, and even reverse mortgages. For seniors with significant savings and investments, these funds can be easily directed toward the costs of assisted living.

Option #2: Public Funding

Public funding is a second option, depending on the restrictions and limitations in your state and the type of care you are seeking. While Medicaid often covers nursing care for elderly individuals with certain conditions, the program is more limited in its coverage for assisted living communities. Additionally, Medicaid is only available for those who have lower incomes and fewer assets. This means that not everyone is eligible even if your state does offer some coverage.

Option #3: Long Term Care Insurance

Not every person is in the position to either self fund their senior care or take advantage of public programs, which is why some choose to invest in long-term care insurance. This type of insurance is specifically for the costs of care as you age, and depending on the policy, can be used for both nursing homes and assisted living. These policies are generally cheaper for younger individuals and more difficult to obtain as you age or develop certain conditions. It is important to read the fine print carefully on these policies, as they are highly specific about what they will cover. Some only cover medically necessary assisted living while others will only fund certain facilities. Depending on whether or not you agree with their choice of facility, this insurance may not be the best choice for your future.

Option #4: Reverse Mortgages

Lastly, for seniors who own their homes, reverse mortgages are a viable source of funding for assisted living. The Home Equity Conversion Mortgage program allows you to tap the equity in your home hat way you can use the cash for other things.

What am I paying for?

One other important question to ask when determining how you will pay for your long-term care or assisted living is to determine what, exactly, you are paying for. In some cases, assisted living facilities charge a flat rate that includes all of the available services. Other facilities charge a base rate that covers the most basic services and costs for the room. Additional services are then charged on an "a la carte" basis, which can add up quickly if you or your loved one needs a great deal of attention each day.