Demystifying the Costs of Senior Housing

by Carolyn Wilson-Scott

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Making a senior housing decision is challenging enough, and figuring out what type of care will fit your budget can really compound the difficulty. Is it cheaper to hire an in-home care professional or move to an assisted living facility? Can I afford my own room at a nursing home? Should I move to an independent living center near my child?

Here are some elements to consider as you weigh the financials:
Type of Care: Ranking the relative costs of independent living, assisted living, home care, and nursing homes isn't straightforward because so many of the following factors affect cost. However, a basic rule of thumb is that the more medical the care, the more expensive it will be. So independent living tends to fall on the lower end of the cost spectrum, assisted living in the middle, and a nursing home on the high end. Home care varies based on the type of service and the number of hours needed. A licensed nurse will cost you more than hiring someone to run errands or see to housework.

Location: In this sense, senior housing is no different than other housing—look for it in a popular city or on the beach, and you'll pay a premium. Of course, if you currently own a home in a sought-after area, and are willing to move to a less expensive part of the country (perhaps to be near family), you could come out ahead.

Amenities: This category tends to apply to independent living options, which run the gamut from a basic apartment building reserved for seniors to resort-like accommodations. If your retirement community looks out over a tee or you are steps away from an Olympic-sized pool, you can expect to pay for it.

Living Space: Senior housing offers a variety of room options. In independent living communities, you can find rooms that range from modest flats to several bedroom condos or even houses. Assisted living typically is made up of one-bedroom or studio apartments, and in a nursing home, you usually can choose from a private or shared room. The bigger the space, the more the cost.

Services: Personal care and medical services replace amenities as the hidden cost in senior housing options like assisted living, nursing homes, and home care. Often assisted living charges a flat fee for the room and added fees for the level of care needed. For instance, some facilities charge extra for incontinence care. Because Alzheimer's care tends to require more attention and expertise, it can be more expensive than non-Alzheimer's care in the same facility, especially if your loved one will be housed in an Alzheimer's-only section.

Subsidies: Some government-subsidized senior housing exists, though waiting lists can be long and admission can require very low income/assets.