How Do You Budget For Senior Living?

You can budget for senior living by assessing your financial goals and researching long-term care costs in your preferred retirement city. Senior living can be a significant expense, particularly if you require residential or institutional care for multiple years. This expense is one that many people should keep in mind, as independent living isn’t always possible.

It’s true that some senior living communities require a sizeable investment, but that doesn’t mean planning for senior living is out of reach for the average retiree. This is what you need to know about how to budget for senior living, including who should make plans and what expenses to keep in mind.

Budgeting for senior living is a good idea for anyone who may require third-party care later in life, regardless of how you expect to spend your golden years. In the United States, most adults will require senior living at some point in time, whether for a short period of time at the end of life or for several years as the ability to live independently diminishes. Regardless, it’s a good idea for everyone planning for retirement to consider the impact of senior living in regard to their savings, including how much money can be expected per month for living expenses in a senior care facility.

Some seniors foresee living with their adult children or other family members in retirement rather than in a senior community. In this case, budgeting for additional scenarios should still be a part of prudent retirement planning. After all, things can change as years go by, and what you want out of life as a senior may evolve, too. Whether you’re budgeting for the future solo, with help from a spouse or with the assistance of a professional, planning for all potential costs is a smart, savvy way to prepare for the future, no matter the retirement goals you have in mind.

When budgeting for retirement, there are many different components to keep in mind, including most or all expenses associated with daily living. Luckily, most senior living facilities cover a wide range of living costs in a single monthly lump-sum payment. Most essentials, like food and housing, are typically covered by this cost. Costs like regular grocery shopping, mortgage payments, utilities, property taxes and homeowners’ insurance will no longer be concerns as these are typically covered in room and board. Of course, seniors may choose to keep additional food in their rooms or buy things like clothes or decor not included in basic costs, which should be something to keep in mind when budgeting.

Seniors may encounter higher costs in a senior care facility than living independently due to the expenses associated with around-the-clock access to caretakers. To accurately budget, those planning for retirement should be aware of average facility prices in their area. Seniors should also consider the potential for additional costs, like move-in fees or fees for day trips. These can vary from facility to facility, but still should play a role when estimating total expenses. Prices can also change with time. The costs advertised today could be significantly higher in the years or decades to come, so plan for extra spending depending on economic factors. Pay attention to how prices change over time, and be prepared to adjust estimates as local care options change.