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Chances are you or someone you love will eventually need help with everyday tasks like bathing, dressing, or taking meds. Yet a 2025 survey of adults in the Pacific Northwest region found 51% “didn’t know enough to estimate” the monthly cost of assisted living. For context, Genworth’s 2024 Cost of Care Survey puts the national median at about $5,900 a month, and Medicare does not cover room and board.
“Affordable assistive living is a bit of an oxymoron,” says Meredith Oppenheim, a senior housing expert and strategic advisor to Springpoint Senior Living in New Jersey. “In cities like New York, senior housing costs can reach over $20,000 per month depending on the size of the unit and care required.”
Planning ahead matters. Assisted living costs have risen 31% faster than inflation since 2004. Depending on your state and situation, you may qualify for programs that provide financial assistance for assisted living. Here’s what to know about your options — and how to make the most of them.
Key takeaways
- Assisted living averages about $5,900 a month; Medicare won’t cover the apartment cost, but smart planning can lower what you pay.
- Medicaid can help with care services in many states; check eligibility early and confirm whether the facility accepts Medicaid.
- To avoid surprises, ask for a written fee schedule, what triggers add-ons, and the facility’s rate-increase history before you sign.
- Build a layered plan using public benefits, insurance, home equity, or savings — and get help from a care manager/navigator, an elder-law attorney, or a financial advisor.
What is assisted living — and who is it for?
Assisted living is a home- and community-based setting for older adults who no longer choose to live alone and who need support with activities of daily living (ADLs) — the basics of self-care like bathing, dressing, eating, using the toilet and moving around.
Today, roughly 2 million Americans live in 31,400 assisted living communities across the country. Most communities include an apartment, as well as:
- Meals
- Activities.
- Housekeeping.
- Utilities.
- Limited transportation.
- Light ADL support.
Services may be bundled or tiered, and higher-level care such as skilled nursing or memory care usually costs extra, so some families add outside help as needs change.
The cost of assisted living: Why is it so expensive?
Assisted living averages about $5,900 to $6,077 a month, depending on location. With the median stay at about 22 months, you would need more than $129,800 to cover a typical stay. Totals climb if you stay longer or live in a higher-cost market.
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Why prices keep rising
- Larger aging population. “With boomers aging into their 80s, demand is accelerating, yet supply isn’t keeping up,” Oppenheim says.
- Limited supply of qualified communities. Occupancy tops 90% in many areas. NIC MAP, a leader in housing research, projects the U.S. will need more than 560,000 new senior housing units by 2030, yet only about 191,000 are on track.
- Inflation in health care and housing. “An estimated 360,000-unit shortfall by 2030 means fewer choices, higher costs and growing uncertainty for millions of seniors,” adds Oppenheim.
Hidden fees to watch
Nearly half of residents or families ran into unexpected add-on fees, according to Kaiser Family Foundation (KFF), a leading health policy organization. Beyond monthly rent, communities may charge for medication management, higher levels of personal care, transportation and assessments. Common line items include:
- $12 for a blood pressure check.
- $50 per injection (more for insulin).
- $93/month to use a non-preferred pharmacy.
- $315/month for daily inhaler help.
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Government assistance for assisted living costs
Medicaid
Medicaid is the largest public payer of long-term care, and in many states it can help cover assisted living services through Home and Community-Based Services waivers (though room and board usually not covered). To qualify, families need to be aware of two key rules:
- Income and asset limits: For 2025, eligibility is often capped around $2,901/month for an individual and $5,802/month for a married couple, with modest asset allowances (varies by state).
- Look-back period: States review financial history for the past 30–60 months, so large gifts or transfers like signing over a home can lead to penalties or disqualification.
“It might be tempting to get rid of assets to qualify for Medicaid, but it’s not that simple,” says Nancy Rodriguez, a registered nurse and CEO of Senior Total Health Network. “The government will go back and check… and this could disqualify you.”
Because rules vary by state, experts often recommend working with an elder-law attorney for Medicaid planning.
SSI and state supplements
Supplemental security income (SSI) provides a monthly cash benefit to low-income older adults and people with disabilities. Alone, it rarely covers assisted-living rent, but some states add a state supplementary payment for residents in assisted living. For context, the average Social Security retirement benefit at the end of 2024 was about $2,430 per month, well short of a $5,900 median rent.
Veterans benefits for assisted living
Eligible veterans and surviving spouses can receive VA Aid and Attendance benefits that can be used toward assisted-living care when help with daily activities is needed and added to an existing VA pension.
2025 Aid and Attendance amounts:
- Surviving Spouse up to $1,515/month.
- Single Veteran up to $2,358.
- Married Veteran up to $2,795.
- Married Veteran (if spouse needs care) up to $1,851.
Veterans generally can’t receive both Aid and Attendance and Disability Compensation at the same time. Some states also operate veterans homes that offer reduced-cost care.
PACE and local supports
The Program of All-Inclusive Care for the Elderly (PACE) combines Medicare and Medicaid benefits and delivers coordinated, team-based care to eligible seniors to help them remain in the community and avoid nursing home placement. In some areas, PACE contracts with assisted living communities.
“I am always looking for affordable, high-quality providers for my clients. This week I recommended PACE three times,” says Dianna Shaw, an assisted living care navigator and certified assisted living administrator. In Massachusetts, she notes, PACE partnerships can make assisted living more affordable. Shaw also reminds families that “checking in is not as simple or easy” as a hotel: applications are detailed, assessments are required, relationships with providers may need to shift, and there is an emotional adjustment to a new space.
You can use Care.com to find assisted living options available in your area. Experts recommend using the Eldercare Locator, a public tool hosted by the U.S. Administration on Aging that connects seniors and their families with services in their community. You can also contact your Local Area Agencies on Aging (AAAs).
Insurance and annuities for assisted living
Long-term care insurance may help pay for assisted living when benefit triggers are met, typically when needing help with two or more ADLs or having a cognitive impairment.
“Start planning early. The younger and healthier you are, the more [long-term care insurance] options you’ll likely have and potentially at a lower cost,” says Bryan Schmidt, a CPA and mortgage debt reduction specialist in Arizona. “You’ll also want to review your existing policies and check if your current life insurance or other financial products offer any living benefits.”
Some life insurance policies include LTC riders or can be sold as an LTC-life settlement to help fund care. Certain annuities offer living-benefit riders that create another income stream, but “riders typically come with annual fees,” Schmidt cautions. He recommends working with a qualified advisor to weigh costs and fit.
Home equity options to pay for assisted living
Homeowners 62+ collectively hold $14 trillion in home equity, according to the National Reverse Mortgage Lenders Association. Used carefully, home equity can help pay for assisted living without draining retirement accounts. Every option has trade-offs and may affect Medicaid eligibility, so plan first.
- Reverse mortgage. Requires sufficient equity and living in the home; no monthly payments; repaid when you leave or pass away; fees and interest are added to the balance.
- Other options. Home-equity loan, HELOC, or selling/downsizing.
Rodriguez recommends consulting a reverse mortgage counselor who has been approved by the U.S. Department of Housing and Urban Development. “Their services are free or low-cost; you can call 1-800-569-4287 to find out more,” she says.
Before you decide, clarify your goal, compare total costs over time, and ask an elder-law attorney how your choice interacts with Medicaid rules in your state.
Other ways to pay
Most families use personal funds at some point. An analysis by the Joint Center for Housing Studies found that only 13% of adults 75+ living alone in major U.S. cities could afford assisted living without tapping assets.
- HSAs. With a high-deductible plan, contributions reduce taxable income, grow tax-free, and withdrawals for eligible medical expenses are not taxed. You can also use HSA funds to pay most long-term care insurance premiums.
- Bridge loans. Short-term financing to cover move-in costs and monthly bills while you wait for a home sale to close or benefits to be approved. These are for timing gaps, not long-term funding.
- Savings and other assets. Social Security, pensions and retirement accounts (401(k)s, IRAs) often anchor the plan. The age you claim Social Security, how you withdraw from accounts, and keeping investments age-appropriate all matter. You can also draw on stocks and bonds, annuities, savings accounts or the sale of valuables. A financial advisor who focuses on senior planning can help you choose what to tap first and protect what remains.
A final assisted living financial tip: Plan ahead
Early planning gives you more choices. Costs rise over time, rules differ by state, and waitlists can be long, so build in time to check eligibility, gather documents, and compare full fee schedules before a crisis.
“We, as a country, have such an affordability crisis when it comes to long-term care. Too often, issues around aging are ignored until they become personal. And for most Americans, it’s about to get personal,” says Oppenheim, who turns 65 in 2038, after Medicare is expected to deplete its funding.
You do not need decades of savings to start. Identify benefits that may apply to you, get on waitlists early, and talk with the right professionals: an assisted living care navigator or geriatric care manager, an elder-law attorney for Medicaid planning, and a financial advisor to sequence savings, insurance, and home equity. There is absolutely no need to try and navigate the costly, confusing assisted living industry alone. Small steps now can help you avoid last-minute, all-private-pay decisions later.
