You’ve talked about it, you’ve thought about it, and now you’re ready to get the ball in motion—now it’s time to budget for senior living. But how? Here are some helpful tips to help you get a plan in place for you, or for your loved one.
A workable budget for senior living: 5 ways to make it happen
- Consider your ultimate goal
- Gather your financial documents
- Research your funding options
- Consider the help of a professional
- Come up with a financial plan
Consider your ultimate goal
Before you come up with a successful budget for senior living, you need a clear picture of what you are going for. For instance, a buy-in community, or a rental? A senior living community that’s close to where you live now, or one in another location? Think about care—it can offer great peace of mind to choose a lifestyle with several levels of care so you know your new home will meet your future needs.
List the amenities and services that matter most to you. Are you willing to pay extra for premium services? Think about the type of residence you envision, as well as access to the outdoors. And consider your timetable; whether the need to make a decision is urgent or you are planning ahead. All these factors can affect your budget for senior living.
Gather your financial documents
Tap into that file cabinet or safe deposit box and see exactly what you have. Don’t forget to go online for your electronic documents and print copies as well. Here are some to look for as you prepare your budget for senior living:
- Bank and brokerage accounts
- Deeds and mortgage account information
- Insurance policies
- Monthly or outstanding bills
- Pension and other retirement benefits
- Social Security payment information
- Stock and bond certificates
Research your funding options
You may be surprised just how many funding options exist. In fact, you most likely have a few already.
- For instance, your home’s equity. Many people choose to sell their home to help pay for senior living costs. This can offer you a convenient source of cash, as well as the freedom from worrying over the maintenance and responsibilities that can come with renting your property.
- Next, selling your insurance is also a possibility. It’s known as a life settlement. It allows you to take advantage of your highest-valued assets without worrying about transaction or application fees and taxes. And you are able to lower your monthly retirement expenses by removing the burden of high monthly premiums.
- Long-term care insurance. If you are looking for senior living for a loved one, and your loved one already has LTC insurance, this may help to pay for care that is typically not covered by health insurance, Medicare or Medicaid. Under most long-term care policies, a person is eligible for benefits when they cannot do at least two out of six “activities of daily living,” called ADLs, on their own or they suffer from dementia or other cognitive impairment. Usually with this type of insurance, you’ll have to pay for long-term care services out of pocket for a certain amount of time, such as 30, 60 or 90 days, before you are reimbursed for any care. Care.
- Investments and savings. Perhaps you’ve been saving for your retirement for a long period of time and built up quite a nest egg. If so, this could have a significant impact on your budget for senior living.
Consider the help of a professional
Choosing a professional who specializes in eldercare and/or long-term care planning can be very helpful with putting together a budget for senior living. In addition to offering you information concerning funding options, they also can help you with potential tax deductions and estate planning.
Come up with a financial plan
Once you’ve gathered all your information and have a good idea of your goals, it’s time to put together a plan that covers your assets, funding sources, ongoing financial duties (paying bills, managing investment decisions, preparing tax returns, etc.) and any other issues that might affect your budget for senior living. With a sound plan in place, you can make decisions that align with your goals.
We are here to help you. At PMMA (Presbyterian Manors of Mid-America®), our extensive services and amenities mean you’ll live a life free from the worries of home maintenance and upkeep and designed to help you connect, innovate, and thrive. We’re here to help guide you towards a decision that’s right for you and your family.
There are several ways to fund senior living – and we’re sharing them all! Download our free guide for financial planning for retirement at a Life Plan community!
