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Unlocking Financial Options for Seniors

July 25, 2023

Affording Assisted Living

Assisted living can be a great option for seniors needing additional care and support, but it can be expensive.

The average cost of assisted living in Florida is $4,000 per month, as indicated by Genworth’s 2021 Cost of Care Survey. However, this figure can vary significantly across the state and based on the level of care that is required. At Sunways, we know the financial burden is significant. We are here to break down several options that can help! Whether it’s by utilizing personal savings, assets, long-term care insurance, life insurance, veterans benefits, or Medicaid, each option has unique considerations. 

  1. Personal Savings: One of the most straightforward approaches to pay for assisted living is through personal savings. Commonly referred to as “out of pocket” payments, using personal funds to cover the costs can be a viable option for those with substantial savings. 
  2. Long-Term Care Insurance: This type of insurance generally covers a range of services, including nursing home care, home-based health care, and assisted living. It typically becomes effective when the individual requires assistance with two activities of daily living (ADLs), such as bathing or dressing. To benefit from this coverage, the policyholder should have enrolled and paid for the policy before reaching the age of 60. 
  3. Assets: Utilizing assets like real estate holdings can be another strategy to pay for assisted living. If the senior’s home has not been sold yet, a bridge loan may help cover the costs temporarily until the sale is finalized. Seniors who own a home also have the option of exploring a reverse mortgage. This financial arrangement allows homeowners to access the equity in their property, which can then be used to fund long-term care expenses. Alternatively, renting out the home is an option to generate income if there is solid support for management via family or friends. 
  4. Life insurance: Life insurance policies can be utilized to finance assisted living expenses. One option is selling the policy to a third party for its market value and using the proceeds to fund a long-term care benefit plan while retaining some death benefits. Another approach involves surrendering the life insurance policy to the company for its cash value, which means relinquishing ownership and forfeiting death benefits.
  5. Veterans benefits: Wartime veterans and their spouses may qualify for a pension program offered by the Department of Veterans Affairs (VA) to help offset senior care expenses. For more information regarding Aid and Attendance benefits, read our eligibility checklist HERE
  6. Medicare vs. Medicaid: Medicare does not typically cover the cost of long-term care in assisted living facilities. It mainly provides coverage for short-term stays in skilled nursing facilities or for certain home health services following a hospital stay. However, many states provide coverage for assisted living services under their Medicaid programs. To qualify for Medicaid, an individual must meet specific financial and functional eligibility requirements, which often include demonstrating a need for assistance with daily living activities.

While assisted living does come with a significant price tag, exploring these various financial options can pave the way for a smoother transition. Please reach out to us for more information! Our senior living concierges are available to answer any questions you may have!

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