Assisted living is probably best described as a generic term for covering a whole range of services that are offered to senior citizens, so what does it all mean on a more personal basis and what does it involve if you or your parents have to come under the umbrella of assisted living.
What assisted living means
In basic terms, assisted living can also be referred to as residential care and it is essentially a living arrangement where a certain level of personal care is provided according to the individual needs and requirements of the person involved. Licensing arrangements vary according to which state you are living in but the basis purpose is the same, for the elderly person to remain in their own home rather than go to a nursing home, and to get help with any daily activities that they struggle to do themselves. The level of help is assessed on an individual needs basis and will generally include help with bathing, dressing, going to the toilet and ensuring that the correct medication is taken.
Paying for assisted living
There are essentially three ways that assisted living can be funded, by long term care insurance, Medicaid or out of savings and other financial resources or income. Medicaid is a government assisted scheme to help pay for the costs involved but this is normally only available to people with limited financial resources, have no realisable assets or have a qualifying medical requirement after they have been assessed. Long term care insurance obviously requires advance financial planning at an earlier point in their life and although you can still take it up even if you are 65, the premiums would probably be more than $3,000 per year. If you are relying on using accumulated savings, even a reasonable amount of money saved up can quickly erode, depending on the length of your life.
Where you live
There are some significant variations between the services available and their cost according to which state you live in. It is very difficult to give a specific figure as individual circumstances and requirements will have an effect on the amount that you will end up paying. As a way of comparison, you can look at the various options available for senior care and the average cost of attending day care would be around $60 per day and whereas assisted living is likely to cost about $110 per day. To get assisted living would cost over $3,000 per month on average but this is roughly half of the cost of going into a nursing home which is likely to cost over $6,000 per month.
Working out the costs
In order to arrive at a reasonably estimated cost for signing up to assisted living you need to evaluate the individual requirements for food, nursing expenses and medication, plus any materials such as diapers etc. Other costs to consider if you are trying to stay in your original property rather than move to a purpose built assisted living facility, are the one-off expenses of adapting the home to meet individual caring needs such as fitting an elevated toilet seat or a seated shower facility.
Whilst you can’t put a price on peace of mind and security, you can put a price on ensuring you achieve this goal by staying in your own home under an assisted living scheme. The earlier you can plan ahead for this eventuality the more financially prepared you will be, which will help when making your choices.
Alan Fields is a financial planner. He frequently shares his money saving tips on blogs dedicated to frugal living. Click to find residential care homes.