Extended care, also known as long-term care, can be a significant financial burden for many families. Costs are not straightforward and can include expenses such as in-home care, assisted living facilities, and nursing homes. These add up quickly and may not be fully covered by insurance or government programs.
There are cost of care projection websites that can help estimate what average expenses may look in your area in the future. Example: https://www.genworth.com/aging-and-you/finances/cost-of-care.html
But there are several cost-saving strategies that you can use to help manage the cost of extended care.
With good financial planning, you can carry the burden of costs a little more easily. Let’s take a look at some ideas that could help.
First, know what is coming. Plan and prepare for the inevitability of extended care. This includes researching the types of care available, understanding the costs associated with each type of care, and considering options such as long-term care insurance. Research and planning can help you know what’s coming and be ready. It is very important to have conversations with family and children ahead of time to understand who has certain expectations. Working with a Certified Long-Term Care specialist can help you navigate the multitude of options. The earlier you do this type of planning, the more options and solutions that will be available.
Another cost-saving strategy is to explore home care options. An example is in-home care, which can be more affordable than moving to a nursing home or an assisted-living facility. Many older adults prefer to stay in their own homes as they age, and home care services can provide the necessary support and assistance to make this possible. There are also more options for in-home care than ever and in more places than in the past. Tip: If purchasing a home later in life, consider if it will be a home that you would like to use for home health care in the future. If so, consider features like having easy access to the house from the outside and minimal stairs inside.
Next, try to save money on extended care by looking into Medicaid. This may become an option after other solutions are exhausted. Medicaid is a joint federal and state program that provides healthcare coverage for low-income individuals. It can help cover the cost of nursing home care for those who qualify. There are other solutions for everyone, though. There are strict income and asset limits, so it is important to consult with an attorney or other professional to determine if you qualify and how to apply. These qualifications are a big reason why this may be considered one of the last options.
If you are looking for an out-of-the-box solution, consider community-based services, such as adult day care or respite care. These services can provide older adults with the support they need while allowing them to remain in their own homes. They can also provide relief for family caregivers who may struggle to balance caregiving demands with other responsibilities. This solution can be a good fit during the beginning part of an extended care event, but likely will not remain the long term solution as the event goes on.
And don’t forget to consider the tax advantages of long-term care expenses. It might be possible to make the best of a bad situation and deduct some long-term care costs from your income taxes. But don’t assume this is always the case. It’s always a good idea to speak with your tax professional to understand the benefits available to you.
The cost of extended care can be a significant concern for many individuals and families. Many challenges may require several different solutions. Take the time to explore home care options, research community-based services, and find the possible advantage of tax benefits. These steps can help you manage the cost of extended care and ensure that the event can be taken care of financially which removes a large burden from loved ones around you.