Assisted Living Costs: Understanding Pricing and What to Expect
Assisted living can be a wonderful option for seniors who need assistance with their activities of daily Living (ADLs) while enjoying life in a stimulating and supportive setting. In this blog, we discuss what assisted living is, how much It costs, and how to pay for It. We also discuss tax deductions for assisted living costs and compare the cost of assisted living to the cost of staying at home.
What Is Assisted Living?
You may be wondering, “Is it time for assisted living?” when you see your loved one in need of a little or a lot of daily support. Assisted living provides personalized care in a residential setting. Also known as supportive living and personal care, assisted living helps independent-minded seniors who could benefit from some support with ADLs, such as bathing, dressing, grooming, and assistance with medication, live their best lives. Like independent living communities, assisted living offers a maintenance-free lifestyle, access to amenities and services, a host of activities, great dining, and daily opportunities for socialization and engagement.
While everyone is different, assisted living services are generally best for those who:
- Need assistance with activities of daily living
- Are not getting proper nutrition at home
- Need help or assistance with medications
- Feel lonely or are isolated
- Have health-related issues
How Much Does Assisted Living Cost?
Assisted Living costs can vary widely depending on the city and state you live in. According to the 2023 Genworth Cost of Care study, the national average cost of assisted living is $5,325. When visiting an assisted living community, be sure to check if the quoted cost is the base rate or if it includes levels of care. Levels of care for assisted living are added to the base rate.
As you visit different communities, you may encounter these three common assisted living cost structures:
À la Carte
The à la carte, or fee-for-service, model allows residents to pay a base monthly rate for their housing and then add on individual services as needed. This offers flexibility and potential cost savings for residents with minimal care needs. However, with fluctuating costs based on changing requirements, this model can make long-term budgeting more challenging.
All-Inclusive
All-inclusive model provides a flat monthly fee that covers housing, meals, basic housekeeping, activities, transportation (often for appointments), and personal assistance with ADLs. This model is ideal for those needing more extensive support, as it offers simplicity, predictable costs, and doesn’t require constant fee adjustments as care needs evolve.
Tiered Structures
With tiered structures, assisted living communities provide between three and five tiers of care depending on a senior’s needs. Many assisted living communities use a tiered pricing structure to accommodate the wide range of needs among their residents. Residents are assessed upon move-in and periodically thereafter to determine the appropriate level of care. Costs for these tiers generally correlate with the amount of staff time and the specific services a resident requires.
See the median monthly cost of care in your state here.
Arizona
2023 data, source: www.genworth.com
| In-Home Care | Community and Assisted Living | Nursing Home Facility |
|---|---|---|
| Home Maker Services $6,292 | Adult Day Health Care $8,667 | Semi-Private Room $7,604 |
| Home Health Aide $6,864 | Assisted Living Facility $5,500 | Private Room $9,429 |
California
2023 data, source: www.genworth.com
| In-Home Care | Community and Assisted Living | Nursing Home Facility |
|---|---|---|
| Home Maker Services $6,864 | Adult Day Health Care $1,842 | Semi-Private Room $11,406 |
| Home Health Aide $7,055 | Assisted Living Facility $6,250 | Private Room $13,231 |
Nevada
2023 data, source: www.genworth.com
| In-Home Care | Community and Assisted Living | Nursing Home Facility |
|---|---|---|
| Home Maker Services $6,197 | Adult Day Health Care $1,625 | Semi-Private Room $10,205 |
| Home Health Aide $5,720 | Assisted Living Facility $5,000 | Private Room $12,395 |
Oregon
2023 data, source: www.genworth.com
| In-Home Care | Community and Assisted Living | Nursing Home Facility |
|---|---|---|
| Home Maker Services $7,055 | Adult Day Health Care $4,182 | Semi-Private Room $14,585 |
| Home Health Aide $5,053 | Assisted Living Facility $5,825 | Private Room $15,208 |
Washington
2023 data, source: www.genworth.com
| In-Home Care | Community and Assisted Living | Nursing Home Facility |
|---|---|---|
| Home Maker Services $8,294 | Adult Day Health Care $7,031 | Semi-Private Room $12,167 |
| Home Health Aide $7,627 | Assisted Living Facility $6,138 | Private Room $13,688 |
Wyoming
2023 data, source: www.genworth.com
| In-Home Care | Community and Assisted Living | Nursing Home Facility |
|---|---|---|
| Home Maker Services $6,673 | Adult Day Health Care n/a | Semi-Private Room $7,604 |
| Home Health Aide $7,150 | Assisted Living Facility $5,730 | Private Room $9,429 |
Factors Affecting Assisted Living Costs
The cost of assisted living varies significantly depending on several factors. Understanding these factors will help you make informed decisions and find a community that suits your budget and needs.
- Location: Assisted living costs mirror regional real estate markets and the local cost of living. Urban areas, especially those on the coasts, tend to be more expensive. Communities in states with lower taxes and lower overall living costs might offer more affordable rates.
- Level of care needed: This is perhaps the most significant factor. Residents who require extensive help with daily tasks like bathing, dressing, and medication management might pay more than those needing minimal assistance, spending on the community.
- On-site amenities and activities: Communities boasting resort-style or luxury amenities generally come with a higher monthly cost than those with more basic offerings.
- Couple vs. individual: Some assisted living communities offer shared apartments or suites for couples, which can be more affordable than two separate residences. However, if one partner requires a higher level of care, there may be additional charges.
As you explore assisted living options, take with you a sheet with questions to ask during your visit. Our Cascade Living Group community professionals will be glad to provide you with the answers you need so you can make well-informed decisions and have peace of mind about the services provided and costs.
How Seniors Pay for Assisted Living
Millions of seniors enjoy the vibrant, engaging life that assisted living communities provide. With most assisted living paid for privately, how to fund the monthly service fees or rent is a question we at Cascade Living Group are asked by just about everyone! Fortunately, help is available. If you find that your loved one seems to qualify for assisted living, the next step is to create a financial plan to help you pay for it.
Many who move to an assisted living community choose to sell their home and use the proceeds to cover their initial deposits and monthly service fees. For others who no longer own a home, this may not be an option, or moving to a community may require the combination of selling a home and withdrawing assets from retirement accounts.
There are also other potential options available to help you fund the move to a Cascade Living Group community, including senior living bridge loans, short-term loans against securities, long-term care insurance, selling a life insurance policy, or reverse mortgages if one person is still living at home while the other moves to assisted living.
Bridge Loans for Assisted Living
Whether to lock in a community promotion or for personal reasons requiring a fast move, you can use the equity in your home to pay for housing or care with a Home Equity Line of Credit for Senior Living, which can act as a bridge loan for assisted living.
Second Act, a senior-focused division of Liberty Savings Bank, F.S.B. of Wilmington, OH, specializes in offering this type of line with a fast process that is tailor-made for assisted living. You can obtain this Line of Credit even if your home is listed, something many banks won’t do.
- Apply for an overall Line of Credit amount.
- Draw what you need each month to cover your monthly service and community fees.
- Make much smaller and more affordable interest-only payments on your outstanding balance.
- Pay back your Line of Credit when you have sold your home.
Bridge Financing provides financial flexibility and gives you time to prepare and sell your home for the highest and best price. Thousands of seniors take advantage of bridge financing to move now while having time and breathing room to sell their homes with peace of mind. Second Act Financial Services is well known and trusted nationally by seniors across the USA. The professionals at Cascade Living Group would be happy to connect you to Second Act.
Veteran Benefits
VA benefits are an untapped resource that can enable your loved one to obtain the assisted living housing and care they need and deserve.
The Veteran Aid and Attendance is a monthly, tax-free pension that is available to qualifying wartime Veterans and their spouses. The benefit is designed to help offset your monthly expenses so that you can stay in care with less financial stress.
| $1,432 | $2,229 | $2,642 | $3,536 |
|---|---|---|---|
| Surviving Spouse Monthly | Veteran No Dependents Monthly | Veteran One Dependent Monthly | Veteran Married to A Veteran |
The application process for Aid and Attendance is long and complex; therefore, many potential candidates rely on third parties to help them apply for their benefits. There are a variety of firms that work with Veterans and their spouses to help them obtain Aid and Attendance. Our Cascade Living Group community professionals can connect you to Patriot Angels to help you determine if your loved one can pay for assisted living with help from the Veteran Aid and Attendance benefit.
Long-Term Care Insurance
Long-Term Care Insurance usually can cover a maximum daily amount for housing and care of a senior living resident. Typically, a resident must demonstrate they need assistance with a certain minimum set of ADLs.
However, insurance providers can make filling and receiving a claim difficult. There are firms that can help you push back to obtain what may be rightfully yours.
Many insurance policies are long and detailed. Working with knowledgeable professionals specializing in filing claims can save you dozens of hours of phone, email, and correspondence time. The professionals at Cascade Living Group can direct you to long-term care insurance experts who can help you receive useful guidance on your policies as you prepare to move to your community.
Life Settlements: The sale of a life insurance policy
We often obtain a life insurance policy when we are still working, so if the unexpected happens, spouses or children still at home aren’t saddled with existing mortgages or other obligations.
But as your circumstances evolve, you may no longer need or want to continue paying the premiums on your policy.
As you explore your senior living options, your life insurance policy may be an asset that you can sell for cash. You have the right to sell it just as you would sell another asset for cash, and also may have the option of keeping a portion of the policy value untouched. You can choose either an all-cash benefit, a retained death benefit, or a combination of the two.
Sale of Securities or a Loan On Your Securities (Margin Loan)
Selling one’s stocks or bonds in a systematic way is one way to pay for assisted living. We encourage our seniors to consult with their tax accountant on what stocks or bonds may be best to sell from their portfolio in order to avoid unintended tax consequences. To help avoid taxes on the sale of securities you can borrow against them, often referred to as obtaining a ”margin loan”.
How does an investment loan work?
You select the securities you would like to borrow against, although there are restrictions. You then decide what percentage to borrow against, up to the maximum percentage allowed. The brokerage firm provides you with a Line of Credit that you can draw upon up to the approved credit limit.
Bear in mind that in a volatile market, large securities-backed loans can be somewhat risky because if the value of your account declines, you may have to post more collateral to keep the borrowing ratio in your loan agreement.
Many seniors do not want the unpredictability that comes with a securities loan and opt for a Second Act Home Equity Line of Credit for Senior Living that can act as a bridge loan in its place.
Assisted Living Tax Deduction
Many seniors and financial advisors, don’t realize that some or all of the cost of senior living may be tax deductible. When choosing senior living community, you should inform your accountant or financial advisor, and tell them to review whether any portion of the desired senior living costs is tax deductible as a medical expense. In many cases, if you are financially supporting a loved one, you may be able to claim them as a dependent and obtain a tax deduction.
Comparing the Cost of Staying at Home to the Cost of Assisted Living.
Vibrant living. Active lifestyle. Peace of Mind. Social times with new friends and peers. Supportive assistance and safety in a community. These are the life benefits one can never put a price on and which senior living provides. When doing the math, you may be surprised by how affordable assisted living may be compared to living at home! From real estate taxes to anticipated repairs, insurance, utilities, cooking, and maintaining the yard, all these things at home carry a monthly or annual cost! Use the worksheet below as a starting point to see just how affordable senior living can be when compared to living at home.
From real estate taxes to anticipated repairs, insurance, utilities, cooking, and maintaining the yard, all these things at home carry a monthly or annual cost! Use the worksheet below as a starting point to see just how affordable senior living can be when compared to living at home.
| Monthly Expense | Monthly Cost $ | Monthly Expense | Monthly Cost $ |
|---|---|---|---|
| Mortgage/Rent | Housekeeping | ||
| Property Taxes | Home Security | ||
| HOA Dues | Transportation | ||
| Homeowners Insurance | Lawn Care | ||
| Utilities | Snow/Leaf Removal | ||
| Trash/Recycling | Regular Home Maintenance | ||
| Groceries | Home Repairs/Replacements | ||
| Phone Service | Personal Alert System | ||
| Internet Service | Home Health Care | ||
| Cable TV Service | Care Coordinator/Manager |
Download a copy of this worksheet
Cascade Living Group communities can enrich your life in many ways. Having a sense of community and safety, and waking up every morning to a vibrant, active, meaningful life, can make a big difference in your quality of life. As you learned in this article, living at home is not “free” because there are costs associated with maintaining your home. When you sit down and crunch the numbers, you may be surprised to see just how affordable senior living can be. But math is only half the story. Emotional happiness that comes from engagement is also important. Visit one of the Cascade Living Group communities today to see how we can enrich seniors’ lives while providing the care they need and deserve.
