A complete guide to the financial realities, emotional decisions, and conversations families don’t know to have until it’s time.
By Tom Post, CFP® , Diversified Portfolios Inc.
Key Takeaways:
• How much does assisted living actually cost? It’s often less than you think. Assisted living can look expensive at first, but many current expenses often disappear at the same time.
• Should I buy long-term care insurance? For many families, self-insuring is the more practical option, depending on their assets and overall plan.
My father lived to 93. My mother lived to 87.
They raised four kids, loved each other through 63 years of marriage, and built a life full of the small, steady things that tend to be the most meaningful. Because my mother was five years younger (and female), we all assumed she’d have more time.
But at 87, my mother had a massive stroke. She never moved into a care facility or used her long-term care insurance. She passed away, and my father, determined to stay in his home until the end, died about a year later.
I share this because that experience has shaped how I sit with every client who comes to me with questions about assisted living. I know that these conversations are less about money and more about love, independence, and the way families hold each other through change and loss.
What I’ve learned is that while the emotions around these decisions are very real, the path forward is usually clearer than families expect; and the financial reality is almost always more manageable than it first appears.
Almost Everybody Wants to Age in Place
This is where nearly every conversation starts. Home holds your routines, your memories, and your sense of control, so the desire to stay there is completely natural.
For some people, aging in place works beautifully. You can bring care into the house, hire aides for specific needs, and maintain your independence while getting help where you need it.
But for many others, it reaches a tipping point:
- One spouse needs more care than the other can provide
- The house becomes harder to manage
- A fall changes everything overnight
I see this tension in my own family right now. My mother-in-law is aging in place, and she’s determined to stay. She’s independent, she’s always been self-reliant, and the idea of moving into a facility feels to her like giving up. Her children (my wife included) would feel better knowing she had more support around her.
The truth is that there’s no perfect answer. The goal is to understand your options, plan for them financially, and make the decision that’s right for your family, even when that decision is complicated.
Understanding Your Assisted Living Options
The variety of facilities available today is almost dizzying in its complexity. That’s actually one of the first things I spend time on with clients: just helping them understand what’s out there and how the different structures work financially.
1. In-Home Care
This is what many people try first: bringing care providers into the home to help with daily needs. It can work well for a period of time, especially for less intensive care needs. But as those needs increase, in-home care can become both expensive and logistically difficult to manage, particularly for a spouse who is also aging and managing their own health challenges.
2. Apartment-Style Rentals
This is the most straightforward option. You move into a facility, pay monthly rent, and if you need additional care services, you pay for those on an à la carte basis. The costs are predictable and there’s no large upfront capital commitment, which makes it the easiest to model in a financial plan.
3. Continuing Care Retirement Communities (CCRCs)
CCRCs can involve buying into a unit and, in some cases, prepaying for future care. That structure can be appealing, but the financial details matter. Resale terms, equity expectations, and timing are not always as straightforward as they appear.
For example, when a resident passes away or moves to a higher level of care, the family may need the community to resell the unit before they can recover their initial investment. I’ve seen that process take years, which means a significant amount of capital can stay tied up longer than anyone planned for. It’s one of the reasons I spend time walking clients through the full financial picture before they commit.
Sticker Shock: The Real Cost of Assisted Care
When someone hears that a facility might cost $8,000 or $10,000 a month, the reaction is almost always the same: sticker shock.
But what people almost always fail to account for is that a whole set of existing expenses tends to disappear when this transition happens.
- If you’re selling the family home, property taxes, insurance, maintenance, and utilities go away.
- If you’re no longer traveling, that expense goes away.
- Even smaller things like dining out, a car payment, gas, and groceries shift dramatically when meals and housing are included in your care.
So the real question isn’t “Can I afford $8,000 a month on top of everything else?” It’s “What does $8,000 a month look like instead of everything else?”
There’s another reality that’s hard to talk about but important to understand. When someone truly needs facility-level care, the duration of their stay is typically only a few years. I know that’s a difficult thing to sit with, but from a planning perspective, that’s often a manageable cost within the context of your broader financial picture.
Do I Need Long-Term Care Insurance?
Twenty years ago, you could buy a long-term care policy that would kick in when you needed help with daily living activities. Those policies offered lifetime benefits and were reasonably affordable.
Today, the policies that are still available tend to be expensive, and they typically cover a limited period of time or a set dollar amount. There are also permanent life insurance policies with long-term care riders that can tap into the policy’s cash value to pay for care. Those exist, and we’ve had clients purchase them, but they’re not right for everyone.
For many families, self-insuring is the more practical path. In our planning process, we model a range of scenarios, which often means families discover they have more flexibility than they initially expected.
The Most Important Advice I Can Give: Maintain Your Optionality
If there is one principle that shapes every conversation I have about assisted living, it is this: do not commit before you need to.
More than once, my parents were urged to buy into a CCRC, and each time I told them to wait. In the end, it was the right call—they never needed the facility.
Your health may evolve differently than expected, you may move closer to family, or the facility itself may change. Keeping your options open allows us to find the right home for you when you need it most.
What About Your “Stuff?”
There’s one part of this transition that catches almost everyone off guard, and it has nothing to do with finances or medical care. It’s your “stuff.”
There’s a concept that’s gained some attention in recent years called “Swedish death cleaning.” It’s the practice of intentionally paring down your belongings while you’re still healthy and able, as a gift both to yourself and to your family. It sounds morbid, but it’s actually one of the most generous things you can do for your loved ones.
When my parents passed away, my family filled two entire construction dumpsters cleaning out their home. My father was a bit of a hoarder; he wanted to keep everything he’d ever had. My mother was less attached to things, but even she had accumulated far more than any of us realized.
My advice is to start that conversation now and ask your kids what they actually want. The answer is almost always fewer items than you’d expect, but the things that do matter carry real weight. I have a few small things from my grandparents and parents sitting on a bureau in my home. They’re tiny, but I look at them and they bring me right back.
We’re Here to Help Make the Tough Decisions
Navigating assisted living options touches every part of life: the financial, emotional, and logistical. There’s no single right answer, and the best decision for one family might be completely wrong for another.
What I’ve seen, again and again, is that the families who fare best are the ones who start these conversations early. And we’re here to help you through all of it, because running the numbers matters, but so does sitting with you through the harder questions about what your family needs and how you want to be cared for when the time comes. If this is something your family is starting to think about, or if you just want to talk through what the road ahead might look like, we’re here.
Not yet working with Diversified Portfolios? If assisted living is something your family is starting to think about, and you’d like a thought partner to help you look at the options, we’d welcome that conversation. We invite you to schedule a complimentary Financial MRI meeting, where we can look at your family’s options for the future you truly want.
