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How to Pay for Assisted Living

Housing | May 25, 2023

A senior couple researching how to pay for assisted living.

Moving into an assisted living community is a big change in a senior’s life. There are a variety of reasons why you or your loved one may choose to move into assisted living, and the right space can help aging adults maintain an active, independent lifestyle. Of course, this new home does come at a cost.

Like any other form of senior living, assisted living is an investment. The cost of assisted living can vary greatly from state to state and community to community. Regardless of the amount, families will need to have a plan in place for how to handle these costs.

Trying to figure out how you can pay for assisted living? Keep reading to learn more about your options.

Living Payment Options

Residents are ultimately responsible for paying for assisted living, but there are a variety of resources that seniors and their families can use to fund this expense. It’s common for people to use multiple payment options to cover assisted living costs. These funds generally come from two different types of assisted living payment options:

  • Private pay
  • Public benefits and assistance

Private pay

The majority of families use private pay to cover assisted living expenses. Private pay encompasses the different ways you can pay for assisted living with personal funds and other sources. It essentially boils down to using your own resources to pay for your assisted living care costs, which includes:

  • Personal funds
  • Assets
  • Insurance

Personal funds

Personal funds are the simplest option for payment. These funds include income, savings, and immediately available money that a senior or their family can use to pay for assisted living. Common sources for personal funds include:

  • Checking account
  • Savings account
  • Money market account
  • Certificate of deposit
  • Investments (stocks, bonds, mutual funds)
  • Pension payments
  • 401(k)/retirement funds

Existing assets

Some families also opt to pay for assisted living by leveraging existing assets. One such example is to use home equity to help cover assisted living costs. Some people take out bridge loans or reverse mortgages for short-term financial assistance, while others may even sell or rent their residence as they move into a new long-term residence.

Selling off assets is a common option for seniors, whether that asset is a house or some other tangible item. Other forms of assets include:

  • Investment properties
  • Cars
  • Jewelry
  • Furniture
  • Electronics


There are a few ways that you can use insurance to pay for part of your assisted living bills. The first is to use Medicare or private health insurance to pay for potential medical care services while you’re in assisted living. Medicare will cover doctors appts/hospital and many therapies but not day to day costs of Assisted Living.

Long-term care insurance is another type of policy that can help with costs. People who invest in this type of insurance policy can be reimbursed for care provided at a variety of places, including an assisted living community.

Seniors may also be able to use any life insurance policies to help pay for assisted living. Depending on your policy, the life insurance company may allow you to surrender your policy for cash value, although you’ll lose any death benefits in this process. Another option is to try and sell your policy to a third party. This process can help you fund your assisted living expenses while potentially retaining some of the plan’s original benefits.

Public benefits and assistance

While private pay covers the majority of assisted living costs, it’s not the only source that seniors have available to them. There are different public resources that seniors can use to lower their personal commitment for important senior care and housing. Common forms of publicly available financial support include:

  • Medicaid
  • Public assistance
  • Veterans’ benefits


Medicaid is a health coverage program that covers more than 72 million Americans, making it the single largest source of health coverage in the country. The Medicaid program is jointly funded by federal and state governments and designed to cover certain groups of individuals, such as:

  • Low-income families
  • Qualified pregnant women and children
  • Individuals receiving Supplemental Security Income
  • People with eligible chronic conditions and disabilities

If accepted, Medicaid can be used to cover some of the services provided at an assisted living community. Medicaid isn’t meant to be used for room and board costs, but it may apply to health care costs and long-term care, such as assistance with activities of daily living (ADLs).

There are a couple caveats with using Medicaid for assisted living. The first is that each state sets its own guidelines for who is eligible and what services are covered, so you’ll need to check with your state’s program for more info on each. The second limitation is that not all assisted living communities accept Medicaid, so this resource is dependent on where you want to live.

Public assistance

In addition to Medicaid, seniors may be able to find different public programs that provide financial assistance to aging adults to cover some of the costs associated with senior living. The exact programs can vary greatly from one state to another – some states even have multiple agencies that support seniors in different regions. Check out your state’s agency on aging to see what assistance is available and if you qualify for that financial support.

Veterans benefits

War era veterans and their spouses are eligible for a special benefit that can help them cover some of the costs of long-term care. The Department of Veteran Affairs offers the Aid and Attendance benefits to surviving military members and spouses who meet the following eligibility requirements:

  • The veteran must have served at least 90 days of active duty with at least a single day served during a period of war (World War II, Korean conflict, Vietnam War, Persian Gulf War).
  • Must be at least 65 years old.
  • Must not have received a dishonorable discharge.
  • Must need help from someone else with ADLs.
  • Must meet the VA’s income and countable asset criteria.
  • (For surviving spouses) Must have been married to a veteran when they passed or remarried to another wartime veteran.

If you qualify for this benefit, the VA provides monthly, tax-free assistance to help you cover the costs of long-term care at home, assisted living, or in a nursing home. Seniors will need to fill out a form to receive these benefits:

  • Surviving spouse – $1,432 per month
  • Single veteran – $2,229 per month
  • Married veteran – $2,642 per month
  • Married veterans – $3,536 per month

Invest in Your New Home

No matter what you plan to do, it’s important to work with a professional and talk to your family about your financial options. You deserve to live a healthier and more satisfying life no matter where you move. By working with your family and financial experts, you can find assisted living that’s best for your personal lifestyle and level of care.

Trying to find an assisted living community that’s right for your needs? National Church Residences is here to help. We encourage our residents to be as independent as possible, but we are here to assist when needed.. Find out which senior living options are in your area or give us a call at 844-465-6063 to talk to one of our friendly staff members today about finding your ideal community.

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