When an older adult living with Alzheimer’s disease or other form of dementia needs more care than their family can provide, they require the support and expertise of professional memory care assistance.
Memory care communities are designed to support and care for people with Alzheimer’s disease or other forms of dementia. These communities provide specialized programs with professionals who are educated specifically in memory care.
In addition to finding the best memory care community for a loved one, families have the added financial stress and responsibility of covering the cost of memory care.
Memory care can be expensive, creating a financial challenge for families. According to Genworth’s Cost of Care Survey, an annual stay in an assisted living community can cost as much as $54,000 annually or more, especially if it involves memory care services.
In this article, we’ll give you seven valuable tips to help navigate and cover the cost of memory care to ensure your loved one receives the care and support they deserve.
7 tips for paying for memory care
1. Ask your financial team
Before deciding how to pay for memory care, consult with your financial team (CPA and financial advisor) to make sure you make financially smart decisions.
A financial advisor can analyze your complete financial picture and provide valuable insights into how to cover memory care costs and optimize your financial resources.
2. Personal savings and assets
Personal savings and investments are the easiest way to cover paying for memory care. A 401k, IRA, personal property, and other investments can all be used to pay for memory care.
3. Long-term care insurance
If your loved one currently has long-term care insurance, you’re in luck! Long-term care insurance policies cover expenses related to long-term care services. In addition to medical care, long-term care insurance can cover help with personal care such as bathing, toileting, and grooming.
Long-term care insurance may cover expenses related to memory care. Policies vary, so make sure to consult your insurance professional.
Although life insurance policies are typically thought of for death benefits, they can be cashed in (converted) to cover memory care costs.
Speak with your insurance agent and CPA to ensure you understand the pros and cons of cashing in life insurance.
5. Department of Veteran Affairs (VA) Aid and Attendance benefit
Veterans or their surviving spouses can utilize the VA Aid and Attendance benefit to help cover the cost of memory care. This benefit provides an additional monthly payment to the monthly VA pension for eligible veterans or surviving spouses who meet at least one of the following requirements:
Require help with daily activities such as bathing, dressing, or eating
Be bedridden for a large portion of the day due to an illness
Be a patient in a nursing home due to loss of mental or physical abilities related to a disability
Have a severe visual impairment
There are specific requirements to qualify for the Aid and Attendance benefit, so check the requirements carefully to ensure eligibility.
6. Home equity
Your home is one of your most significant assets and a financially savvy way to pay for memory care. Below are a few ways to use the equity in your home to pay for memory care:
A reverse mortgage allows people aged 62 and older to borrow against a portion of their home’s equity. Payments can be made in a single lump sum, monthly installments, or as a line of credit.
Selling your home
Selling a large home or having an estate sale can create funds to pay for memory care.
Renting out your home
Renting a home or even utilizing a home as a vacation rental is a creative way to keep your home and free up money to pay for memory care.
7. Medicaid and Medicare
Seniors with limited income or financial resources may qualify for Medicaid benefits that may help with some memory care expenses. Medicare covers some costs associated with a memory care community. Check with your local Medicare and Medicaid offices for more information.
Paying for the cost of memory care doesn’t have to be stressful.
You can navigate memory care costs by understanding and exploring the various financial resources, consulting with a financial professional, leveraging insurance or your home.