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How to Navigate the Process of Paying for Senior Living

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If you’re seeking long-term care for yourself or a loved one, price is likely a key concern.

According to A Place for Mom, the monthly median price of senior care can range from $2,500 at an independent living facility to $8,800 at a nursing home. In New Hampshire, you can expect to pay even more.

For the average family, the thought of footing this expense can be overwhelming. Luckily, affording long-term care isn’t as complicated as it may seem.

To help you navigate the costs of senior living, we have developed a step-by-step guide.


Step 1: Estimate Your Long-Term Care Costs

The first step to paying for senior living is to determine how much it will cost.

The ultimate cost of senior care depends on many factors, including:

  • Care needs
  • Location
  • Accommodations
  • Services and amenities
  • Entrance fees

We discuss these factors, as well as how they may influence your budget, below.

Senior Living Care Needs

How much support you or your loved one needs will significantly impact the cost of senior living. As a rule: The more assistance provided, the higher the cost of care.

For example, assisted living in New Hampshire costs about $6,000 per month according to Caring.com. Comparatively, skilled nursing can cost as much as $11,315 per month.

In short, an aging adult with more complex care needs should plan on spending more on senior living. However, even relatively healthy seniors should account for the expense of evolving care needs.

Location of Senior Living Facility

The location of where you or your loved one will receive long-term care also has a significant impact on price.

Typically, senior living communities in high cost of living areas will be more expensive than communities in average or low cost of living areas.

This fact may influence where you decide to put down roots. If you don’t have the resources to afford care in a specific city, you may choose to relocate to a more rural community or a different state altogether.

Senior Living Accommodations

Senior living communities often offer a range of different accommodations, from studio apartments to townhomes.

Each of these floor plans will vary in price.

At Havenwood Heritage Heights, for instance, residents pay $1,500 for our studio alcove cottages. Comparatively, our more spacious two-bedroom cottages range from $3,375 to $4,115.

Senior Community Services and Amenities

When estimating your long-term care budget, it’s important to understand the services and amenities offered at each senior living community.

Communities vary widely. Some offer luxurious, resort-style conveniences like on-site movie theaters and heated pools. Others provide no-frills options that are more affordable.

If you’re working with limited resources, you must decide which services and amenities are worth the extra cost.

Entrance Fees

Some senior living communities, specifically continuing care retirement communities (CCRCs), also charge something called an entrance fee.

An entrance fee is an upfront charge that secures your spot in the community.

This fee can range from $100,000 to $1 million. However, most aging adults pay about $300,000.

If you or a loved one are thinking about moving to a CCRC, you must consider how an entrance fee will impact your budget.

Step 2: Look for Savings

When evaluating senior living communities, there are ways to shave hundreds — if not thousands — of dollars off your annual long-term care costs.

Here are our top tips for saving on senior living:

Ask About Discounts

Many senior living communities offer discounts if you select certain floor plans, move in during a specific timeframe, or opt for a longer lease.

Don’t be afraid to ask community representatives about these special promotions.

Be Candid

Be honest about your budget when you meet with community representatives. Some may be willing to work with you and find options that suit your finances.

Reconsider All-Inclusive Communities

All-inclusive communities are very convenient since they bundle all costs — from dining to landscaping — into a single recurring charge.

However, if you’re working with a limited budget, you may look into senior living communities that offer select services on an à la carte basis.

This allows you to pick and pay for what you truly need.

Consider Smaller Spaces

If you or a loved one is struggling to pay for long-term care, you may consider opting for a smaller space.

Rather than a two-bedroom cottage, for instance, you may select a studio apartment.

If your loved one is transitioning to an assisted living or memory care community, you may also consider a semi-private room as opposed to a private room.

Step 3: Explore Private Pay Options

After determining the exact cost of senior care, the next step is to consider payment methods.

Typically, families finance senior living through a combination of:

  • Personal savings
  • Annuities
  • Long-term care insurance
  • Life insurance
  • Cash-out refinance
  • Bridge loan
  • Health savings account (HSA)
  • Family assistance

Personal Savings

Although it’s not an option for everyone, the simplest way to pay for senior living is by tapping your savings.

Your savings may include:

  • Traditional savings accounts
  • IRAs
  • Certificate of deposits (CDs)
  • Stocks, bonds, and money market accounts

You may couple these funds with your monthly Social Security or pension payments to afford the senior living community of your choice.


If you have money earmarked for retirement but are worried that the funds won’t be sufficient, you may consider investing in an annuity.

An annuity is a contract between you and an insurance company in which you make a lump-sum payment. In return, you receive regular disbursements over a certain period of time.

Purchasing an annuity can help you stretch your financial resources and ensure that you always have a source of monthly income.

Long-Term Care Insurance

Long-term care insurance is designed to cover select expenses associated with senior living.

Typically, these policies reimburse policyholders a daily amount for services to assist them with activities of daily living like bathing and eating.

However, most long-term care insurance policies have limits on how long or how much they will pay.

If you have already purchased long-term care insurance, contact your agent to understand how to use the policy.

Life Insurance

Life insurance is normally thought of as a benefit for surviving family members.

However, in some cases, the company that issued your life insurance policy will buy it back for 50 to 75 cents on the dollar.

You can also sell the policy to a third party in exchange for a settlement.

To find out if your life insurance policy can provide you with immediate financial support, speak to your agent about living benefits.

Cash-Out Refinance

Many seniors sell their homes to fund long-term care. However, another option is a cash-out refinance.

With a cash-out refinance, you can withdraw a portion of your home’s equity in a lump sum.

A cash-out refinance is a good idea if you want to keep your home, perhaps for a child or grandchild to inherit. However, keep in mind that this refinancing method will increase your monthly mortgage.

Bridge Loan

A bridge loan is a short-term loan that provides aging adults with the funds needed to transition to senior living.

Typically, a bridge loan is secured by your home and paid back once your home sells.

Unsecured bridge loans can also provide immediate cash flow for seniors who don’t have a home to put up as collateral.

Health Savings Account (HSA)

A health savings account (HSA) lets you set aside pre-tax income to pay for medical expenses.

In some cases, your HSA assets can be used for medical services rendered at a long-term care community.

In other cases, you can withdraw a lump sum from your HSA to help with the costs of senior living.

Family Assistance

When adult children have ample financial resources, they may be able to help their aging parents pay for senior living.

Of course, not every adult child is in the position to help their parents financially.

However, for some families, splitting the cost of senior living between siblings is less expensive than moving the parents into a sibling’s home or traveling to provide caregiving duties.

Step 4: Research Government Programs

For aging adults with limited assets, paying for senior living can be much more difficult.

However, there are government programs that can help defray the costs of long-term care.

  • Medicare
  • Medicaid
  • Veterans benefits


Medicare is a government-funded insurance program available to Americans who are 65 or older.

Unfortunately, Medicare doesn’t cover the cost of assisted living or any other form of long-term residential care.

However, this program may cover short-term care expenses, including:

  • 100% of the first 20 days in a Medicare-approved skilled nursing facility after a qualifying hospitalization
  • 80% of days 21 to 100 in a Medicare-approved skilled nursing facility for patients with a qualifying diagnosis
  • Short-term rehabilitation at a nursing home after a hospitalization
  • In-home therapy, in some cases


Medicaid provides financial support to seniors who can’t afford long-term care.

Long-term care benefits include:

  • Assistance with personal care, like bathing or toileting
  • Inpatient and outpatient hospital services that aren’t covered by Medicare
  • Home health services after an injury or hospitalization
  • Rehabilitation services and hospice care
  • Respite care for a limited period of time

It’s important to note that Medicaid benefits and eligibility requirements vary from state to state.

That being said, if you or a loved one hope to apply for Medicaid, it’s advised that you first contact your state medical assistance office.

You should also keep in mind that not all senior living communities accept Medicaid assistance.

Veterans Benefits

The U.S. Department of Veterans Affairs offers two types of long-term care benefits:

  • VA Aid and Assistance: This benefit provides a substantial monthly payment on top of existing VA pensions for veterans and surviving spouses who need assistance with activities of daily living.
  • Housebound Benefits: This benefit provides supplemental income for veterans and surviving spouses who spend most of their time at home because of a permanent disability.

To qualify for these benefits, you or your loved one must meet basic eligibility requirements:

  • Veterans must have had at least 90 days of active duty, with one of those days being during wartime
  • A veteran or surviving spouse’s net worth must be below $130,773
  • Clinical requirements vary, but the highest amount is awarded to seniors who need assistance with activities of daily living

Step 5: Seek Professional Advice at Havenwood Heritage Heights

Navigating the costs of senior living can be overwhelming for many families.

If you’re the adult child of an aging parent, you want the best for your mother or father. However, you may not be in a position to help them financially.

If you’re a senior exploring long-term care for yourself, you may no longer feel comfortable living alone. However, you’re likely worried about footing the expense of a senior living community.

At Havenwood Heritage Heights, we understand your concerns and are here to make the transition to senior living easier. As a continuing care retirement community in Concord, NH, we provide a variety of affordable options to suit your budget.

To discuss these options with a kind and knowledgeable community representative, contact us today by calling 800-457-6833.


By Mike Wall


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