Planning for Your Future Care
As you age and begin thinking about who will care for you if you can no longer care for yourself, Paramount Senior Living should be on your list of options. Depending upon the region in which you live and the type of care plan you select. Often, people eliminate assisted living as a possibility because they believe they cannot afford the monthly cost of such care, but you’ll be surprised to know that there are many ways you can plan for and afford to stay in this type of environment if the need arises.
Developing a Financial Plan for Assisted Living
One way to ensure that you or your loved one will be able to afford the costs associated with assisted living is to create a long term financial plan. This is a complex process that is best handled by professionals who can guide you through the planning process and help you understand the assistance that may be available in your specific situation. With a plan in place, there will be no uncertainty about how assisted living care will be paid for when the time comes.
You can get professional help in developing a financial plan through:
- Public Benefits Counselors at your local Area Agency on Aging
- Eldercare Resource Planners
- Elderlaw Attorneys
Ways to Pull Money for Assisted Living
While paying for senior living expenses by using personal savings or relying on relatives’ contributions may seem like the only options, there are several other possible forms of financial assistance that you can explore to help cover the monthly costs.
Reverse Mortgage– A reverse mortgage is one option for homeowners who are age 62 and over and who have one spouse remaining in the home and one entering assisted living. If you set up a reverse mortgage, you can borrow money from your home equity in a lump sum or in smaller increments as needed. The older you are, the more you can borrow on your home equity.This type of loan would not need to be paid back until the homeowner sells the home or dies.
Home Equity Line of Credit– Similar to a reverse mortgage, this type of loan allows you to borrow money based on home equity and may only require interest payments for the term of the loan. Loan payback would occur when the home is sold.
Life Insurance Policy Conversion– Life insurance policies provide a number of possible options for policyholders to obtain funds to pay for assisted living expenses.
- Life settlements or viatical settlements (for terminally ill patients only) would allow the policyholder to collect a lump sum while relinquishing their right to collect the death benefit. This would also relieve the policyholder from making monthly payments on the premium. If a patient is terminally ill, they may also be able to collect a portion of their death benefits prior to their death in order to pay for care.
- Death benefit loans allow a policyholder to borrow money on the value of the policy. This loan would have to be repaid, or the value of the death benefit would be lowered.
- Direct life insurance conversions allow the policyholder to trade the value of their life insurance policy for senior living or assisted living care. This means that if the patient held a $150,000 life insurance plan, they could sell that plan to a third party, such as a senior living facility, in exchange for their assisted living or long-term care expenses for several years.
Veterans Benefits– The Aid and Attendance Benefit is a type of assisted living pension specifically for veterans. Veterans must meet the eligibility requirements, but this program can provide up to $1,881 for single veterans or $2,230 for married vets per month.
Medicaid/Medicare Advantage– Medicaid assistance varies from state to state, but help with the costs of assisted living can be provided by several different Medicaid waivers. Some states’ Medicaid programs only pay for the care of the patient and do not assist with the costs of room and board, and each state has its own specific limitations or regulations about the size and type of facility in which the patient must reside in order to receive these benefits. Medicare Advantage is another program that pays for the cost of personal care services in an assisted living environment.
Assisted Living Loans– These loans can be very helpful for covering the cost of assisted living while the resident or their family is waiting for other funds to become available, such as from the sale of a home. An assisted living loan is a way to bridge the time period between when a person enters assisted living and when the alternative funds are obtainable.
Long Term Care Insurance-Most Americans do not have a long term care insurance plan, but those who do may get coverage for at least part of their assisted living costs. These plans are not available to elderly patients who are already receiving or are in immediate need of assisted living care.
As you can see, there are numerous avenues to explore when considering whether or not you can afford senior living. The more you plan ahead, the easier it will be on you and your family if you choose to move into a senior living facility. At Paramount Senior Living, you can expect to receive premium healthcare care in our comfortable residential environment. We know that this is a very important decision, and we would love to answer any questions you have about the financial aspects of staying with us. Call us today with questions or to schedule a tour!