While many older Americans wish to age in place, others welcome the chance to move to a retirement community, where they can be closer to companionship and care and escape from home maintenance concerns. What’s stopping them? Financial concerns, especially this one: how can they pay for a senior community?
With inflation worries, fixed income realities, and the reported costs of senior care communities, it’s a fair question. Answers require considering several essential factors.
Considerations in how to pay for a senior community
Senior living costs
First, consider the factors that affect community costs. Knowing these can help you determine ways you can mitigate financial impact.
Costs by state
The costs of senior housing options vary, across the country and even within states. In 2025, for example, the average monthly cost at an assisted living facility in the U.S. was $6,200 – that’s $74,400 per year. The average monthly cost of a semi-private room in a skilled nursing facility is $9,581 – $114,975 a year. However, some states are markedly more affordable than others. The South has the most affordable senior living costs, with the Midwest coming in just behind. Several of the most expensive states are in the Northeast.
Even within a state, location can affect the cost – both by region and between city versus rural communities. Compare a semi-private room in nursing care in two different areas in Virginia (2025 figures from Carescout Cost of Care), for example: in Winchester, near Northern Virginia and metropolitan DC, the monthly cost for is $14,494; in non-metropolitan areas of Virginia, the average monthly cost is $8,517.
Given the variations, seniors on a budget could consider moving to a new state or city for retirement.
Costs by community
Costs vary among senior communities depending on:
- level of care: less cost for independent living than for skilled nursing care
- amenities: perks such as a clubhouse, fitness center, and pool can increase the cost
- housing types and sizes: apartment versus freestanding homes
- room options: private or semi-private
- community fees: standard throughout the industry, these one-time nonrefundable fees are similar to deposits when renting an apartment
Knowing the costs can help seniors find ways to cut costs, by locating a community that best fits their budget and needs and by knowing how to save.
For example, some community services, such as dining options, laundry, housekeeping, and transportation, may be optional. In addition, seniors can choose a semi-private room in an assisted living community. Not only will they trim monthly costs, they can also benefit from the companionship.
People concerned with how to pay for community living can also consider the length of the contract. Some senior living options do require a long-term contract. A CCRC (continuing care retirement community, also known as a life plan community) typically requires a hefty entrance fee and a lifelong commitment (on the other hand, they offer guaranteed care to residents across all levels of care).
Other communities offer shorter contract options. Commonwealth Senior Living offers month-to-month residency agreements. “Residents may choose to move with 30 days’ notice, providing peace of mind for families who value flexibility,”
Resources to help pay for a senior community
Seniors use various options to help them pay for senior living.
“Think of it like paying for college,” says Alex Papasavvas, founder and CEO of Second Act Financial Services. “College students and their parents often have to cobble together a variety of ways to pay for education. It can include some out-of-pocket funds, scholarships, grants, and loans. Same with senior living. Families typically pull together a variety of options to pay for senior housing and care.”
These options include:
- Selling a home
- Social Security income
- Bridge loans
- Retirement account withdrawals
- Sales of securities and loans against securities
- Life insurance policies
- Long-term care insurance
- Reverse mortgages
- Personal funds
Seniors Guide ran a series of articles on several of these options for paying for senior living. Click on the links above to read more.
Government assistance
Some government assistance is available for eligible Americans.
U.S. Department of Housing and Urban Development
HUD Section 202 Supportive Housing for the Elderly provides subsidized apartments for low-income adults age 62 or above. Residents typically pay about 30% of their adjusted income, leaving income available for necessities such as groceries and medical care.
Other government options for low-income adults include housing choice vouchers, Low-Income Housing Tax Credit (LIHTC) housing, and state agencies.
Medicare
The National Council on Aging reports that Original Medicare (Parts A and B) doesn’t cover assisted living. However, it does cover short-term care in a skilled nursing facility after an inpatient hospital stay. In 2026, a $217 per day coinsurance applies after 20 days, and any days beyond 100 must be paid for out of pocket. Medicare does cover some costs for people with dementia, including skilled nursing home care.
Medicaid
The NCOA explains that Medicaid doesn’t cover room and board in assisted living, though some states offer assistance on services such as medication management and on-site therapy.
Veterans benefits
The U.S. Department of Veterans Affairs offers some health care assistance for qualified veterans at approved assisted living facilities, nursing homes, and other residential options.
Some senior communities go the extra mile to honor veterans. Commonwealth Senior Living, for example, runs a Promise to Veterans program, which includes moving assistance among other ways to assist and honor vets. “It is a tangible way we stand beside those who once stood for us,” Commonwealth states. “By coordinating and easing the moving process, we help reduce stress and ensure Veterans feel supported, respected, and deeply honored from the very beginning of their new chapter.” Commonwealth communities also post celebratory displays and services and display flags representing all branches of service.
Most older adults who desire to simplify life in retirement can find a suitable option that will work for them. After a long life of hard work and contributing to the community, they deserve to live in a home they can enjoy.
