According to financial services company Genworth, the 2024 median annual rate of assisted living communities in the U.S. was $70,800. It is 10% more than the previous year, but these communities’ occupancy rates increased considerably, from 77% to 84%!
Still, $70,800 translates to a monthly median cost of $5,900. So, paying for assisted living can undoubtedly be a significant expense, especially for seniors who may no longer be in the workforce.
The good news is that assisted living expenses can still be manageable. Practical financial planning for seniors, including savvy budgeting and the right financial products, can help with this goal.
So, join the team at TerraBella Roswell, our senior living community in Roswell, GA, as we explore how older adults can pay for the cost of assisted living.
Personal or Retirement Savings
Personal or retirement savings are some of the most common ways to cover senior care costs, and they can come from:
- Thrift savings accounts
- Individual retirement accounts (IRAs)
- Employer-sponsored retirement accounts, such as 401(k)s and 403(b)s
Still, depending on the total amount saved, paying for long-term care services with personal or retirement savings alone may not be practical. For instance, in a December 2024 post, Investopedia reported that adults aged 65 to 74 only had a median retirement account balance of $200,000. As for the 75+ age bracket, it was only $130,000.
Regardless of how much savings you or your older loved one has, it’s wise not to rely solely on it to pay for assisted living expenses. Instead, consider implementing these savvy financial tactics.
Smart Budgeting
Smart budgeting helps seniors:
- Determine their cash outflows
- Find opportunities to save more money
- Stretch their dollars
The first step to proper budgeting is pinpointing all income sources. For older adults, these may be:
- Pensions
- Retirement accounts
- Income from assets
- Interest on savings accounts
- Government assistance programs
Some Roswell, GA, seniors may continue to generate income from “retirement” jobs. Either way, establishing all these cash inflow sources is necessary for creating an accurate budget.
Next is to list all monthly expenses. Here are some examples:
- Potential or current assisted living costs
- Medication and healthcare costs
- Personal care items
- Entertainment
Identifying all those expenditures lets seniors spot areas or opportunities for more savings or cost-cutting.
Finding Ways to Save
Say you have an older loved one who has decided to transition to a senior assisted living community in Roswell, GA. Instead of a one-bedroom apartment, they can choose a suite. It would cost less but still be roomy enough to provide them with a spacious living environment.
Another strategy is to look for a reputable senior living community known for offering exceptional services at affordable rates.
TerraBella Roswell, our memory care and assisted senior living community in Roswell, GA, is a perfect example. We deliver superior value for our high-quality housing options and top-of-the-line personal care services. At the same time, we provide discount programs to help our military veteran residents save thousands on their assisted living costs.
Catching Up on Contributions
Seniors who still generate income can maximize their retirement savings by making catch-up contributions. Take advantage of these, so you or your older loved one can compensate for missed savings and investment opportunities.
The Internal Revenue Service (IRS) says that individuals 50 or over can make the following catch-up contributions for 2025:
- $7,500: For most federal government Thrift Savings Plans, governmental 457 plans, 401(k)s, and 403(b)s
- $11,250: For 401(k) plan participants aged 60 to 63
- $3,500: For most SIMPLE plans
- $3,850: For certain applicable SIMPLE plans
- $5,250:For SIMPLE plan participants aged 60 to 63
- $1,000: For Roth IRAs
Long-Term Care Insurance
Long-term care (LTC) insurance is a private senior care payment option. It provides regular payments to the insured (or the policyholder). The insured can then use the funds to pay for assisted living expenses.
Depending on the coverage amount, LTC insurance can cover a portion or all of an insured person’s senior housing and long-term care needs. Some policies pay in cash, which the insured often receives as a monthly lump sum payment. Others pay by reimbursement, where the policyholder gets a “refund” for the covered costs they incurred up to their policy’s maximum monthly coverage or benefit.
Life Insurance
Another option to cover assisted living costs is through a life insurance policy with:
- A long-term care (LTC) rider
- An accelerated death benefit
- A life settlement option
An LTC rider is an additional coverage that allows a policyholder to use a portion of the policy’s death benefit to pay for long-term care services, such as assisted living expenditures. However, insurers may only allow policyholders to use their LTC rider if they can prove they have a medically necessary need for ADL (activities of daily living) assistance.
An accelerated death benefit is like a cash advance from a life insurance policy’s death benefit. The insured does not need to prove the need for ADL assistance; they can use the funds however they see fit, including paying for assisted living costs. However, the insurer will deduct the cash advance amount from the proceeds the beneficiaries will receive upon the policyholder’s passing.
With a life settlement, the insured sells their policy to the insurer. They receive the policy’s current value in cash, but the insurer terminates the coverage.
Home and Community-Based Services Waivers
Older adults in Roswell, GA, may also receive financial aid from the Georgia State government’s HCBS Waivers. They are like vouchers with a specified amount. Qualified seniors can use them to help cover some long-term care costs, including those provided by an assisted living community.
Explore All Options When Paying for Assisted Living in Roswell, GA
Combining multiple financial sources, such as personal and retirement savings, LTC coverage, and life insurance benefits, can make paying for assisted living in Roswell, GA, more manageable for older adults.
At TerraBella Roswell, our assisted living community in Roswell, GA, we take pride in delivering superior value to our residents. Our spacious, well-appointed suite and one-bedroom apartment homes, paired with our exclusive senior lifestyle programs with numerous inclusions, can help make high-quality assisted living services more affordable to area residents.
So, if you or an older loved one is looking for a warm, loving senior living community that delivers exceptional value, we invite you to call us today and schedule a tour of TerraBella Roswell.
