Finding out that a loved one needs care in an assisted living and memory care center can be a devastating and heartbreaking decision. Besides the emotional feelings that come with that decision, one of the other main concerns can be the costs of this kind of care. There options available that can help alleviate some of the costs and, in some cases, cover all costs.

Finding a way to pay for assisted living

There are many options available for financing assisted living costs, and seniors and their families often choose more than one way to pay these costs. It is a matter of finding the ways that best suit your needs and budget.

Using long-term care insurance to pay for assisted living

Long-term care insurance is designed to help policyholders pay for the costs associated with long-term elder care services like assisted living. Long-term care insurance is private insurance. Monthly premiums for this type of insurance vary widely depending on the health, age and amount of coverage.

Those planning on using long-term care insurance to pay for assisted living usually must be planned well in advance. The best time to purchase long-term care insurance is between the ages of 40 and 50.

Some may be ineligible to purchase this type of insurance after a certain age or if you have certain major health conditions like Alzheimer's, Cancer, Heart Disease or Multiple Sclerosis. Other conditions that may make someone ineligible to purchase long-term care insurance if there a criminal record or a history of substance abuse.

When purchasing a long-term care insurance policy, it is very important to read all the fine print and fully understand the terms of your agreement. Working with an insurance or elder care attorney when purchasing a long-term care insurance policy can be beneficial.

Using life insurance to pay for assisted living

An active life insurance policy of $50,000 or more can be sometime be converted into a long-term care benefit plan account. Converting a life insurance policy to a long-term care benefit plan involves transferring ownership from the policy holder to an official benefits administrator.

Funds from a life insurance policy will then be put into an FDIC-insured benefit account and automatic payments will be made to a designated care provider, like an assisted living facility. The remaining account balance will be distributed to family members or other beneficiaries after the policy holder passes away.

Using Veterans Administration benefits to pay for assisted living

The Department of Veterans Affairs (VA) offers several programs to help veterans and their families pay for long-term care services, including assisted living. To be eligible for these benefits, you meet all the following criteria:

• The individual must be signed up for VA healthcare.
• The Department of Veterans Affairs performs a Geriatric Evaluation and conclude that the individual needs a specific service to help with with ongoing treatment and personal care.
• The service or long-term care setting is available near the patient.

Generally, the VA does not pay for room and board at an assisted living facility, but will pay for other basic services and healthcare expenses.

VA aid and attendance pension

Certain veterans may also be eligible for the VA Aid and Attendance Pension, a version of the basic Veterans Pension specifically for veterans with limited income who cannot complete the activities of daily living without the assistance of another person.

These pension benefits will cover some of the daily living costs in an assisted living residence. The amount possibly received from the Aid and Attendance Pension is based on how many dependents there are and if the individual us married to another veteran who qualifies. Other facts to remember include:

• The maximum yearly Aid and Attendance benefits for veterans with no dependents is $24,610.
• The maximum yearly Aid and Attendance benefits for veterans with at least one dependent spouse or child is $29,175.
• The maximum yearly Aid and Attendance benefits for two veterans who are married and both qualify for the Aid & Attendance Pension program is $39,036.

To learn more about accessing these services, call the VA's toll-free hotline at 877-222-8387, Monday through Friday, 8:00 a.m. to 8:00 p.m. EST.

Using a reverse mortgage to pay for assisted living

A reverse mortgage is a loan that allows homeowners to tap into the equity in their homes and use it to pay for things like home repairs, medical expenses or in this case, the cost of assisted living. The loan is repaid when the home is sold after the borrower dies or moves out permanently. A reverse mortgage is usually only an option if a spouse or other co-borrower on the loan still lives in the home. Contact a reverse mortgage specialist in your area for more information about how reverse mortgages work and whether or not you qualify for one.

Using an annuity to pay for assisted living

An annuity is an insurance product that can be used as a source of income during retirement. Think of it as a contract between you and an insurance company in which the insurance company makes regular payments or a single large payout to you in the future. An annuity can be purchased in either one lump sum or overtime in a series of payments. Annuities will grow over time and can provide income later in life when you need to pay for long-term care.

An annuity should be considered an investment, and like all investments, it carries a certain level of risk. Because purchasing an annuity can be complex, it is essential to work with a trusted financial advisor or attorney.

Using a bridge loan to pay for assisted living

A bridge loan is a short-term loan that a senior takes out to fund their move to an assisted living facility while they wait for their house to sell. Taking out a bridge loan can be risky. Generally, this option should only be used if necessary. If your house does not sell as quickly as you thought it would, you will still be on the hook to begin loan repayment, which means you will be paying for the loan, your home's mortgage and the costs of assisted living. For some, bridge loans pass the risk test.

Research each option and talk to friends and family members who have navigated paying for assisted living. Consider speaking to a trustworthy financial advisor or elder care attorney who can help you decide how best to use or invest your current assets for future long-term care needs. Another good idea is to look into state, regional or local agencies and organizations on aging. They may have information on additional resources, offer benefits and financial counseling, and help walk you through government programs like Medicaid and Medicare.