Most people’s social security income and savings are insufficient to cover assisted living costs. Most combine cash from multiple sources, including home-sale proceeds, long-term-care insurance benefits, and contributions from relatives, to achieve the required amount.
Affording Assisted Living Cost
1. Use the Personal Savings
It can be easy to afford assisted living facilities with savings and income from several sources. It can be your official retirement plan, the 401(k), or other private savings or investments. They can play a significant role in preparing for long-term care or assisted living. Saving money can be important for your financial security, quality of life, or future.
2. Apply For Veterans’ Benefits
Veterans typically benefit from health care coverage and other medical insurance the United States government provides through the Department of Veteran Affairs (DVA). It can assist you in saving the cash that you would use on health care. One can use this money to save for other critical things, such as housing.
Veterans are, however, eligible for other government programs, such as VA pensions, which are monetary supplements. Because this cash is a supplement, veterans shouldn’t show they are in financial distress.
3. Use Life Insurance Plans
If you have been paying life insurance policy premiums for a significant period, you can use that cash to afford assisted living. You might decide to leave some cash for your loved ones; however, the payout for the cash-out could help you.
4. Use a Reverse Mortgage
This can be risky, but it is a way to afford assisted living. You can use this option if a family member or a loved one is still living in the home and you are entering long-term care or assisted living. Those who own homes and are older than 62 years old can take out a reverse mortgage and borrow around 74% of their home’s value.
It can be a significant advantage, although it involves several financial obligations. Therefore, consider the pros and cons before deciding financially on future care or assisted living.
5. Take Out a Long-Term Care Insurance Policy
This insurance policy will make sure you can afford assisted living if you need it after retirement. You can purchase this policy through private insurance companies. Different firms provide different premium requirements depending on multiple factors, including age, amount of coverage, and health. Opting into this option would only be appropriate if you have an underlying condition, as insurance firms do not allow coverage.
6. Take Out a Loan
Loans are often risky, but a short-term loan can help you pay for assisted living cost. A bridge loan will help you close the financial gap and therefore afford to pay for long-term care. A loan can be useful if you want to sell your home to pay for long-term care but have not found a buyer. You can repay the loan later when your home finds a buyer.
Final Word
There are several ways of paying for assisted living costs, including taking out a loan, using annuity income, and using social security income to pay for long-term care or assisted living.
