What Happens When My Money For Assisted Living Runs Out?


A question came in this week through out blog, asking “I need affordable assisted living for my mother that won’t kick her out when her money runs out.”

Interestingly, I get this question, in one variation or another, quite often, and unfortunately it’s a tough question that’s even tougher to answer.

A roundabout way of answering it would be to say “Why do you think there are so many family caregivers in our country?”

What happens when money for assisted living runs out?

The truth of the matter is, if you or a loved one is living in an assisted living facility, and you run out of funding, and have no backup plan, the last “person” or entity that is likely to show you or your loved one any compassion or understanding is the facility itself.  Let’s face it – most assisted living facilities are for-profit enterprises, and an assisted living bed is valuable if filled, and a huge liability and drag on the cash flow if empty, or filled with a non-paying resident.

Evictions are common with assisted living facilities, and I would submit first and foremost for anyone considering any care environment outside of the home to get a copy of all of the facility’s policies, including for dismissals or evictions, and what specific policies are in place for residents who suddenly cannot pay.

Moving a resident out of a facility, especially an elderly resident suffering from Alzheimer’s or dementia can be a traumatic and confusing experience, so avoiding eviction through proper pre-planning should be every family’s goal.

Of course, for those of us out there who have properly planned for retirement, and have a tidy nest-egg, as well as supplemental insurance (Long-term care insurance generally covers home care, assisted living, adult daycare, respite care, hospice care, nursing home and Alzheimer’s facilities), and other backup plans, you’ll probably be ok.

However, many of us (as evidenced by a recent fascinating Frontline documentary “The Retirement Gamble” that exposes how ill-planned most of us are when it comes to saving and planning for our retirement years) have not planned, and are in for quite a sticker shock when we are suddenly faced with illness, Alzheimer’s or cannot continue to manage the Activities of Daily Living.

According to Genworth – the cost of care for a private, one-bedroom assisted living facility room, per year, is for most states between $40,000 and $50,000

Learn the cost of care in your state: https://www.genworth.com/corporate/about-genworth/industry-expertise/cost-of-care.html

Rates can vary depending on the level of care, and location. Nursing homes can be quite a bit more expensive.

Needless to say, a Social Security check alone probably won’t come near covering this.

So what happens when the money runs out?

Unfortunately, if there are immediate family members, the brunt of the care can fall on them.  Often times this resides on the shoulders of sons and daughters, who often times are sandwiched between caring for aging parents, and their own younger kids – all the while juggling work and their own finances.

For seniors who don’t have close family who will step up, a state’s Social Services department  or an Area Agency on Aging may step in to try to find a solution.   This may come in the form of home-care, meal delivery, daily check-ins by social workers, and occasional transportation to appointments and shopping.

Understandably, this type of care can’t match what is found in most private, more expensive care environments, and may lead to isolation and loneliness for seniors who can’t afford assisted living.

The picture isn’t pretty in many cases.  There are thousands upon thousands of cases where seniors are neglected, and un-cared for when they need it the most.

Giving yourself a reality check when you are still healthy and ‘young’ by researching what assisted living will cost if and when you will need it, and planning accordingly is the only way to really avoid being denied care down the road.

As one of the consultants in the Frontline documentary says “Start planning in your 20’s and 30’s for retirement costs. If you wait until your 40’s or beyond, your ship has sailed.”

A sobering reality indeed.

12 thoughts on “What Happens When My Money For Assisted Living Runs Out?

  1. Marvin Segel

    I have both a Supplemental medicare and LTC policy.
    I am a very healthy 80 year old.
    Both of these policies have increased 30% over the years.
    It has become harder and harder to meet all of my needs
    since my annual income is 20,000 dollars.
    I realize there is nothing I can do to move toward supplemental
    income because my SS income is to high. With all other expenses moving up, I just have to tough it out.

  2. Vince Burns

    I think it would be really sad to have the money run out for someone that is in an assisted living facility. It would make it hard on the family, but I know that sometimes you have to do just that. I find that most families that have family in the assisted living facilities have the money to keep them there for a while.

  3. sue sweet

    my mother in law is moving to an assisted living facility in mayo fl they have advised that when her money runs out, medicaid will take over and she can stay.

    unfortunately i have tried to plan but with the hit i took in 2008 my retirement savings is down to next to nothing, i will be at the mercy of the system. this was certainly not my plan. i have no kids and no family so i am in one heck of a position. i better keep my health for many years to come.

  4. D. R. Haynes

    Money doesn’t have to run out if you own a home. Instead of thinking about how much it will cost for monthly living, start thinking about ALL the EXTRA MONEY you will have beyond the monthly costs. That extra money each month, beyond living costs, could exceed $20,000. We’re not talking about a reverse mortgage that can run out, think positive and be able to stay in your own home with professional health care and see a positive income stream

  5. D. R. Haynes

    You don’t have to run out of money ever if you have a home. No monthly healthcare costs and being able to see a extra monthly income. Extra monthly income, over your cost of living, exceeding $20,000. Stay in your home, enjoy your privacy, professional healthcare and a very comfortable income.

  6. Fletcher L. Hart

    I am single with no children!!! My parents got me on, SSDI. When I turned 66, this year, my SSDI turned into regular SS. I have HUMANA GOLD-[HHMO] as my supplemental insurance. I will have dementia one day because of a, BOTCHED UP OPEN-HEART SURGERY. The o2 levels in my blood were not keep correctly, giving me, what they call, THE PUMPHEAD or PERFUSION SYNDROME!!!! I got the SSDI because I am BIPOLAR TO, which we know there is no cure for. I want to move closer to my family in CHARLESTON S.C. to an ASSISTED LIVING near my family. I have some savings to pay their bill but when that runs out, WILL I BE ELIBLE FOR MEDICAID, so I can stay in this assisted living. I have too much right now to be elible for MEDICAID, so what route should I take now. I own a truck and my home with a small mortgage on it. Should I SALE everything NOW and get myself approved for MEDICAID or ” WHAT ” !!!! I sure need some good advice and my younger sister is trying to help me with this!!! I this email would be answered as to WHERE to took for help and advice, it most surely would be APPRECIATED!!! Thank you for and help and advice with this situation, sincerely, Fletcher l. Hart in Jacksonville, FL. EMAIL ADDRESS IS: fbooger49@yahoo.com

  7. Fletcher L. Hart

    Needing HELP on how to get into an ASSISTED LIVING FACILITY and how to get on MEDICAID after my money runs out, thank you, Fletcher Hart

  8. Kelly Toole

    My mother who is 92 is currently liivng n an assisted facility, she s running out of money in 3 months and we would lkiie to know where
    to go about seeking her another facility. for her , so she does not end up in the street. please send us information so that we know she will have a safe place to live. thsis is a dire emergency , please advice. Kewlly. Im at my wts end

  9. Charles, Assisted Living Caregiver

    Great post, thanks for sharing. The whole situation is pretty tough, I wish we would take care of our elderly better than treating them as inventory to be moved or discarded.

  10. Bob Koresu

    My brother needed to go into an assisted living facility about 2 years ago and has to pay $4500 per month. this is more than his pension and SS combined. I’ve been paying his rent every month b but will run out of money eventually.. A friend in the medical field told me there is a program to pay the expenses.
    I’ve asked she send me information, which I’ll share here.

  11. kay conley

    My relative has enough money to live in an assisted living facility for 5 years. She has Alzheimers. She has a house, which she wants to deed to one of her sons. He wants to sell it and rent an apartment. If she lives beyond 5 years, is this home still considered one of her assets even though it was sold? Also, if the gov’t goes after the money, who would it go after? The new owner?

  12. D. P.

    Medicaid does not pay for Assisted Living. Medicaid will pay for a Nursing Home if someone qualifies to be in a nursing home. The facility will often assist the individual with the Medicaid application.