The cost of living in the US has increased by roughly 15 percent in the last decade alone – and in some states and cities, it has increased by far more than this. Over this period, senior housing and other living expenses have increased disproportionately. Many of them now struggle to pay for their retirement in North America privately.
According to the website “Senior Living Near Me”, an information site about housing and retirement in the US and Canada, senior living facilities charge between $25,000 to $100,000 per year. However, they note that the exact amount charged is dependent on the kind of facility you live in, the type of room (private or semi-private), and which part of the US you’re in.
For example, nursing homes and memory care facilities are much more expensive than assisted living centers, which are more expensive, the senior apartments. Specifically, nursing homes are about twice as expensive as assisted living facilities, the website estimates.
In addition to housing, there are other additional costs that seniors need to factor in and budget for. These include additional private care, medical bills, and other add-ons, which many senior living facilities charge their residents.
Also, aside from the annual rents and service charges, most retirement homes in the US charge a few thousand dollars a move-in fee. In the grand scheme of things, this may not sound like a lot, but all these extra charges can quickly add up.
How Can American Seniors Pay For Their Retirement?
Most often, seniors pay their retirement costs by relying on their savings or 401(k) retirement plans. Many of them choose to sell off their primary home and invest the money into an annuity so they can get paid regularly (almost as if they have a job) instead of sitting on a big pile of cash.
Some other options to raise money for retirement living costs include taking out a reverse mortgage or selling off other assets, such as an expensive car, jewelry, or artwork. According to Harbor Life Settlements, you can even look into selling assets like your life insurance policy through a life or viatical settlement to help cover retirement costs.
If seniors don’t own any assets to pay for their senior housing, they may be eligible to get financial aid towards their retirement living from the Medicaid program. In some cases, Medicaid can cover all of their living bills, so it’s a great option for low-income seniors to look into.
Medicare, another US-wide financial support program, doesn’t provide much financial support for seniors unless they are staying in a retirement home for a short period for treatment (for example, if they are staying in a memory care home for 3 weeks.)
Which Type of Senior Accommodation is Right For Me?
As we’ve already stated, there are several different types of retirement centers and senior accommodation. The main groups are independent living communities, assisted living homes, nursing homes, and memory care facilities.
Each of these offers different levels of care and support to residents, so seniors should decide which is best suited to them towards the start of the research process.
Independent living communities consist of apartments and homes arranged into communities for seniors to live in together. This option provides seniors with the most freedom and independence. Still, they don’t offer any support with your nursing or personal care, so they are only suitable for healthy, independent older Americans.
Assisted living facilities are a type of retirement home which provide residents with assistance with their care. This includes help in getting dressed, meal preparation, and bathing. However, these facilities do not provide in-house nursing and medical care, so they are not suitable for seniors who need such care and attention daily.
Next, we have nursing homes. This type of housing provides both personal and nursing care, and many such facilities have registered nurses (RNs) and specialist doctors.
Memory care homes are a subset of nursing homes that focus on treating seniors and other patients suffering from conditions that affect their memory (for example, Alzheimer’s disease.) They are one of the most expensive types of retirement homes to live in, as they have to pay for specialist staff and nurses to provide the required amount of care to residents.
It is usually quite easy to figure out which type of retirement home is right for you. For example, if you need some level of daily nursing care, a nursing home or memory care home is best for you. In contrast, if you want as much flexibility as possible, a senior apartment is probably your best bet.
Other Things to Consider
Aside from the cost and the amount of care provided, there are many other things to consider when picking senior housing. Many of them often contemplate relocating – to another state or even outside the US – as they sometimes want a change for retirement.
Relocating and retiring abroad is easier said than done, as there are many things you need to check and arrange beforehand. For example, you should consider any language barriers and think about learning the spoken language there to at least an intermediate level before relocating.
Arranging the necessary documentation can also be a long and bureaucratic process, though Americans are usually eligible to relocate to most other countries of the world.
It would help if you also judged each retirement home based on its “feel” and how you feel about the safe there. It’s also a good idea to speak to residents there to see how they find living there and to see if you could see yourself making friends with the other residents there, as socializing with other seniors is very important, especially as loneliness among seniors is a real issue in the US.
Finally, you should think about what kind of room you want in the retirement home you choose. There usually are two options – private and semi-private rooms. Private rooms are usually 20-30 percent more expensive than semi-private rooms, and they are usually more desirable, as you have more space and don’t have to share your room with anyone else.