Most senior citizens choose to age in place by remaining in their current residences rather than relocating to a nursing home or other facility for long-term care. While staying at home can appear like a cost-saving strategy, there are often hidden fees involved with aging in place.
To make the best choice for yourself or a loved one, learn more about the typical costs of long-term in-home care and your options.
Did You Know
Many experts advise that retirement income should be about 80% of a couple’s final pre-retirement annual earnings. Fidelity Investments recommends saving 10 times your annual income by age 67.Investopedia
In-Home Care Cost
The price of hiring professionals is the first expenditure that many people think about when choosing in-home care.
To understand how home care expenditures vary across the nation in July and August of 2021, CareScout, a Genworth Financial business, contacted 4,195 home care providers.
- Over 90% of home care providers bill by the hour; however, some provide discounts for monthly agreements.
- In the United States, the average hourly price for home care in 2021 was $26. This indicates that although half of home care agencies cost more than $26 per hour, the other half charged less.
- In-home care prices vary according to geography, legal requirements for caregivers, and the required degree of care.
- Seniors can receive full-time, in-home care for a median monthly cost of $4,957. This is based on the industry standard of 44 hours of care each week.
- The cost of in-home care services increased at a five-year annual compound growth rate of 5.39% from 2004 to 2021. This includes a rise of 10.6% from 2020 to 2021 brought on by an increase in demand.
Here’s a list of the 10 most expensive and most affordable home care based on each state for further basis:
|10 Most Expensive States For Home Care||10 Most Affordable States For Home Care|
|Minnesota: $35.00 an hour||West Virginia: $18.50 an hour|
|Washington: $34.34 an hour||Louisiana: $19.00 an hour|
|Colorado: $33.50 an hour||Mississippi: $20.00 an hour|
|California: $32.00 an hour||Alabama: $20.00 an hour|
|New Hampshire: $31.50 an hour||Arkansas: $21.95 an hour|
|Oregon: $31.50 an hour||Georgia: $22.50 an hour|
|Massachusetts: $31.00 an hour||North Carolina: $23.00 an hour|
|South Dakota: $31.00 an hour||South Carolina: $23.25 an hour|
|Alaska: $30.00 an hour||Texas: $24.00 an hour|
|Hawaii: $30.00 an hour||Tennessee: $24.00 an hour|
A senior may not always require full-time care, or family members and friends may be able to provide some unpaid assistance. NPR notes that when loved ones step in as unpaid caretakers, the results can be missed wages and future lost benefits. However, this does result in other forms of costs.
Additionally, even if you require a little amount of help each day and have the means to pay for it, you can still incur some of the less evident costs of aging in place at home, which are included below.
Eating healthy is a must for anyone and especially older people. If you plan to age in place, you must account for food expenses to ensure that you can eat healthily and on time.
This includes items purchased to eat at home as well as dining out. Retiree households typically spend an average of $6,599 ($550 a month) on food, compared to $8,169 annually ($681 monthly) for the average U.S. household. Almost 40% of retiree spending is for dining out.
Home Remodeling Or Upgrade Costs
A safe home is crucial for seniors who wish to age in place and remain as independent and mobile as possible. It is not ideal for this use if you currently reside in a long-term property that was bought while raising a family or just starting in retirement. This may entail spending money on renovations or upgrades to the home so that you can age in place there.
The following expenses for typical home renovations to accommodate an elderly loved one are accessible on Home Advisor and are listed below. The numbers below reflect the average national costs.
General remodel for Disability Accommodation
- Average national cost: $6,226
- Common inclusions: Adding a wheelchair ramp
- Installing handrails or lowering cabinets
- Adjusting doorway widths
- Estimated cost: $5,618 to $12,861
- Common inclusions: Bathtub midrange costs: $2,600 – $4,100
- Toilet midrange costs: $340 – 480
- Sink midrange costs: $1,400 – $2,300
- Estimated cost: $11,087 to $28,528
- Common inclusions: Install cabinets midrange costs: $3,500 – $5,500
- Install countertops midrange costs: $2,100 – $4,100
- Install an appliance midrange costs: $400 – $600
You may visit the Home Advisor site to get an estimate for other and more specific home modifications based on your area.
The cost and hassle of transportation may increase for older people who stay alone in their houses. This is particularly true for senior citizens who are unable to drive themselves. When this occurs, there are several choices for traveling to appointments or social gatherings:
- Asking friends and family for assistance
- Public transit
- Ride-hailing (Lyft and Uber)
- Senior transportation assistance programs.
Seniors in more suburban or rural places sometimes have different options, although clever seniors in metropolitan areas can frequently keep transportation expenditures quite low.
According to a source, an older person or retiree typically spends an average of $6,749 per year or $562 per month on transportation.
Transportation costs should be estimated depending on the current gas and car maintenance prices if you have your car and can still drive. For those unable to drive, check for the local fare in your area when creating a budget.
To find other transit options, you may visit Eldercare Locator, check the National Center for Mobility Management online directory, or dial the 211 phone code reserved for callers to get information and referrals for health and social services in their community, including transportation.
Home Maintenance Cost
You must still consider maintaining and caring for your home if you intend to live there. Seniors need to spend time on maintenance duties like house cleaning or lawn care or get assistance. As you get older, you might not want to mow the lawn, weed the garden, clean the gutters, or shovel snow.
Clever data found that the average American spends over $3,000 per year on maintenance and repairs.
Other home maintenance average costs that you may incur are as follows:
- Lawn care and landscaping: $1,200 to $2,400
- HVAC cleaning and maintenance: $376
- Clearing rain gutters: $161
- Pest prevention: $176
- Replacing smoke alarm batteries: around $50
- Housekeeping and house cleaning: $175
- Pool care (if you have one installed): up to $5,000 per year
Setting aside money for your yearly home maintenance expenses, State Farm recommends 1 to 4 percent of your home’s value.
It is also crucial to budget for the experiences and pursuits that make you happy while budgeting for retirement or aging, whether they be reading, viewing movies or TV series online, live performances of the ballet, opera, or Broadway, or renting movies.
This is especially important for those who want to age in place or independently to avoid or reduce the feeling of isolation that usually leads to symptoms of depression among older adults.
According to BLS data, seniors aged 65 to 74 spend an average of $2,988 per year on entertainment per household.
Some of the common entertainment costs that you may note include:
- Live Streaming Options: $9 – $20 / month
- Movies: $10
- Opera Tickets: $95
- Ballet Tickets: $30 – $175
- Basic Cable: $20
- High-Speed Internet: $20
You may also refer to the following sources to better guide you in estimating costs for your aging-in-place plan:
- A National Aging In Place Council Handbook: The Costs Of Aging
- Genworth: Cost Of Care
- Home Advisor’s True Cost Guide
Although growing older is not inexpensive, it also does not inevitably mean losing one’s independence.
Planning, saving money for future costs and considering all available options are necessary for those who want to avoid moving into an assisted living facility or nursing home to receive the care they require in the environment of their choice. It is also important that you know how to stay on a budget and not to go beyond things that are not necessary. It will also be helpful to learn some crucial financial planning tips that will help you make better financial decisions.
Your financial advisor can help you think through this and ensure you are best prepared accordingly.