Navigating the Costs: How Older Adults Can Afford Senior Living
So, you’ve decided to explore senior living communities. This is an important and exciting step! There are so many excellent options to choose from—each with its own unique amenities and features. But as you look around and dream about your future home, one big question probably comes to mind
“How am I going to pay for this?”
Don’t worry—you’re not alone; we’re here to help. Yes, senior living can feel expensive. In 2024, the average cost of assisted living (which includes rent, food, housekeeping, and personal care) was approximately $4,995 per month in the United States, while the average Social Security benefit is about $1,976 per month. But don’t let those numbers overwhelm you. There are many ways to cover the cost of senior living. When you take a closer look, you may realize that assisted living is more affordable than you think.
Why Senior Living is Worth It
Consider your current monthly expenses. How much does it cost to maintain your home? While the average monthly mortgage payments, insurance, utilities, and insurance can vary widely, here are some typical average monthly costs in the Twin Cities:
- Mortgage or rent: $1,500-$2,591+
- Property taxes: $250
- Utilities (electricity, water, heat, etc.): $300+
- Groceries: $500
- Home maintenance (repairs, lawn care, etc.): $150+
- Insurance: $112-$236+
That’s already around $2,812-$4027 per month—which does not include the cost of in-home care, transportation, or recreation. Assisted living often combines all these expenses into one monthly payment, plus added benefits like 24/7 care, delicious meals, housekeeping, and social activities.
When you compare the costs, assisted living can be a smart financial decision—and it can also make life easier and more enjoyable!
Eight Ways to Pay for Senior Living
If you are wondering how to afford senior living, here are some of the most common ways people cover the cost:
- Long-Term Care Insurance
Do you have a long-term care insurance policy? If so, this could be one of your best resources. Most policies cover assisted living, so now is the time to review what your plan offers. Check with your insurance agent to see what is covered and save yourself a big headache—and potentially a lot of money.
- Veterans Aid & Attendance Benefits
If you or your spouse served in the military during wartime, you might qualify for Veterans Aid and Attendance benefits. These benefits can help cover a significant portion of assisted living costs. Visit the VA website to learn more about eligibility and application requirements - Personal Savings and Private Pay
What does private pay mean? It’s simply paying for senior living out of your own resources, like savings, income, or investments. This might include contributions from family members or liquidating assets like stocks, bonds, IRAs, or CDs. While it’s a significant expense, planning ahead with a financial advisor can make this option more manageable.
- Pension Income
If you’re receiving a pension from a previous employer or membership organization, that monthly income can be applied toward your assisted living expenses.
- Life Insurance Policies
Your life insurance policy can help cover senior living costs. Depending on your policy type, you might be able to use cash value, take out loans, or access accelerated death benefits. Talk to your insurance agent for details.
- Annuities
An annuity allows you to convert a lump sum of money into steady payments over time. This option can provide a reliable income stream to cover your living expenses.
- Your Home
Your home can be one of your greatest financial assets. You might sell it and use the proceeds to fund senior living, or if your spouse still lives there, consider a reverse mortgage. This allows you to access cash from your home’s equity while continuing to live there.
- Elderly Waiver and GRH (Group Residential Housing)
Medicaid's Home and Community-Based Services (HCBS) waivers, authorized under Section 1915(c) of the Social Security Act, allow states to provide long-term care services in home and community settings as alternatives to institutional care. These waivers enable states to offer services tailored to specific populations, including older people. Thirty-five states offer 1915(c) waivers targeting services for older adults. The availability and particular services of these waivers can vary by state.
For instance, Minnesota offers the Elderly Waiver (EW) program, which provides home and community-based services for individuals aged 65 and older who require the level of care provided in a nursing home but prefer to reside in the community.
If you qualify for Medicaid, you may be eligible for Minnesota’s Elderly Waiver (EW) program, which helps cover the cost of home and community-based services like assisted living. Similarly, GRH (Group Residential Housing) is a state program that can assist with housing costs for individuals with limited income. Both programs have specific eligibility requirements. You can learn more by calling Minnesota’s Senior LinkAge Line at 1-800-333-2433.
Does Health Insurance Cover Senior Living?
Generally, health insurance, including Medicare, does not cover the cost of assisted living. However, it may help cover certain medical services provided in an assisted living setting, such as physical therapy or skilled nursing care. To better understand what’s covered, review your policy or contact your insurance provider for details.
Where Can You Find More Resources?
A wealth of information and support is available to help you navigate senior living costs.
- Senior LinkAge Line*: A free resource in Minnesota offering expert advice on aging services.
- Veterans Services Offices: For help applying for VA benefits.
- Financial Advisors: Experts in estate planning and long-term care solutions.
- Assisted Living Communities: Many communities have specialists who can walk you through financing options.
Why Assisted Living is an Investment in Your Future
Moving to an Assisted Living community isn’t just about finding a new place to live—it’s about investing in a lifestyle that prioritizes your health, happiness, and independence. With assisted living, you’ll have access to:
- 24/7 professional care
- Nutritious meals prepared for you
- Fun activities and social opportunities
- A safe, comfortable environment
- Freedom from household chores and maintenance
Plus, with so many funding options available, you can make this move work for your budget.
Let Us Help You Plan
At Ebenezer, we understand that everyone’s finances and needs are different. That’s why we are here to help guide you through the process. Talk to a financial advisor, estate planner, or an expert in senior living funding to explore all your options.
We want to help you find a home where you can thrive—and make the most of this exciting new chapter in your life.
Senior living is more affordable than you think. Let’s find a solution that works for you!
*Every U.S. state offers resources similar to Minnesota's Senior LinkAge Line to assist older adults in finding housing and services. These programs are often part of the state's Aging and Disability Resource Centers (ADRCs) or are managed by state departments dedicated to aging services.