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How to Pay for Assisted Living

38 Comments

All these ways to help pay for assisted living are great if you plan ahead. But, there are some that NEVER planned (my mother). Now what? Everywhere I have called want $3000 or more. Her SS isn't near that much and if you add in the assistance from the VA (husband was a war vet) that brings her right at the cost of an assisted living place with VERY little extra money if any at all. How is it possible to take everything they have??

Valace, the Assisted Living facility my Dad lived in didn't charge it residents for any repairs.... unless my Dad wanted something out of the ordinary done to his apartment.

Need help with home repairs my mother on disability

If you go into an assisted living facility you cannot use a Reverse Mortgage to pay for it. One of the requirements (at least it was when my MIL got her reverse mortgage) was Occupancy. A Reverse Mortgage and an Home Equity Loan are not the same. Yes, you are taking equity out of the house but they are different types of loans.

The article is very informative over all, but the explanation of life settlements, or life insurance settlements, was a bit unclear.
A life settlement occurs when the owner of a policy sells their policy to another party. This sale should be prepared and offered through a broker so that the policy can be offered to multiple institutional investors through a competitive bidding process . The owner of the policy gets money now, and gives up the death benefit, which goes to the new owner of the policy. The issuing company does not purchase the policy back. Many policies have a 'cash value' or 'surrender value', which many people accept when applying for medicaid. Depending on factors such as the death benefit and life expectancy of the insured, investors may pay substantially more for that policy than the issuing company in exchange for the death benefit. If you plan on getting nothing for a term policy ( which may be converted to another type of policy then sold,) or cashing out for the surrender value on a whole or universal life policy, find out what a life settlement might bring. Someone 70 or older with a life expectancy of 15 years or less, and a policy with a death benefit of $100K or more should look at a life settlement as opposed to simply accepting the surrender value or allowing a policy to lapse.

I was very interested to read that a surviving spouse of a veteran may qualify for an amount that would help pay for my Mothers assisted living costs. I will be sure and follow up on this.

I reverse mortgage might be good if the elder is still mobile and doesn't need a lot of care. Case in point, my Dad was paying $20,000 a month for 24 hour professional caregivers because he was a fall risk. That would have been $240,000 a year for him to stay in his house. Now he is in Independent/Assistant Living [his choice] which will be $60,000 per year. Big difference. Now he is secure knowing that he has enough money to age in place at that beautiful complex.

Dad will be glad once he sells the house.... no worry about repairs or property taxes, or shoveling snow, moving the grass, and dealing with all those stairs stairs. And he's around people of his own generation :)

Nice article as a general overview. I would like to offer some more specific commentary on Reverse Mortgages as they relate to helping pay for in-home care. A Reverse Mortgage is suitable for homeowners 62 and above that have equity in their homes. Reverse Mortgages are government insured loans specially designed for seniors with no monthly forward mortgage payments required. In the instance where a homeowner has a mortgage and/or other debt, a Reverse Mortgage is an ideal instrument that can be deployed to manage and help balance monthly cash flow. It’s nothing more than paying attention to money in versus money out over the course of a calendar month. A Reverse will eliminate the forward mortgage payment(s) and other selected debt payments thereby freeing up funds for living expenses and care (taxes & insurance still required). Without the burden of out of pocket monthly payments to your lender(s) the first of each month, it is easier to focus on the needs at hand such as in-home care. Whether you have debt to pay off or not, a Reverse will also provide a credit line for any residual available home equity. This is also ideal because any unused portion of your available home equity will grow annually at approximately five percent as you age. Your home equity is no longer strictly a dwindling asset but now rather a growing resource that can help you stay in your home.

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Hi Sweet Aim, The spouse has to have been married to the vet at the time of their death.