St. Anthony's Senior Living

How to Prepare Your Finances for Independent Living Care

Financial matters tend to affect the lives of all Americans. But, as a senior citizen, finances may play an even larger role in your living situation. After all, your priorities often change, and new realities may influence your spending and saving habits. 

As you’re enjoying the early days of retirement and looking forward to continued relaxation, it’s an important time to make sure your finances are fully prepared to support you. One of the best ways to give your budget stability in retirement is to consider transitioning into Independent Living!


Financial Benefits of Independent Living

As you transition to Independent Living in a senior living community, your finances get significantly easier to manage. No more keeping track of multiple bills and due dates. No more stressing over scheduling doctor appointments, HOA and other municipal items, or ever-increasing property taxes. Every single bill at a senior living facility — rent, electricity, water, gas, cable, internet, landscaping, maintenance, etc. — is simplified into a single monthly payment, taking the anxiety of financial management off your plate!

Of course, senior living communities aren’t cost-free, which is why you should start preparing your finances now instead of waiting until you’re officially ready to move.


Cost of Living vs. Independent Living

At St. Anthony’s, independent living includes all of your typical monthly expenses plus 30 chef-prepared meals each month, covered parking, housekeeping, maintenance, fitness club membership, and a social calendar packed with fun activities and events.

While the cost of Independent Living is on the rise, so is the cost of living. In 2022, the overall cost of living experienced the highest 12-month increase since 1981. This increase is often felt particularly by seniors, who rely on Social Security, at least in part, to cover expenses in retirement. In order to be fully prepared to cover your expenses before moving into Independent Living, it’s important to get your finances in order sooner rather than later.


Independent Living vs. Assisted Living

Your costs will vary depending on whether you’re in need of assisted living support or are able to care for yourself in independent living. While both options include housing, utilities, housekeeping, and access to all senior living amenities, assisted living is the more costly option as it includes personalized medical care, support with Activities of Daily Living (ADLs), and full dining.

Because assisted living is considered more need-based, it can sometimes be covered by Medicare or Medicaid and insurance. Independent Living, in contrast, is a personal choice rather than a senior care need, so it likely will not be covered by these medically-based financial options.


Five Tips to Prepare Finances for Independent Living

If you hope to enjoy the benefits of Independent Living but aren’t sure of your financial stability by the time you retire, here is what you can do to prepare:

1. Get a Financial Advisor

Planning and preparing your finances can be overwhelming, but you don’t have to do it alone! A financial advisor can help you plan for retirement and make informed decisions regarding your investments, savings, and any potential options to help you plan for a financially secure retirement. If you don’t have one already, selecting an independent financial advisor (also called a financial planner) can be truly helpful. As you look for one, it’s important to check their credentials and ensure they’re a fiduciary, which means they’re obligated by law to put your needs first no matter what.

2. Evaluate Savings and Investments

Many retirees have an employer-funded 401K as part of their job’s benefits. Retirement plans are an excellent way to set aside funds to support you later in life. Other specialized investment accounts you may have include 403(b), 457(b), profit-sharing, an individual retirement account (IRA), or a Roth IRA. 

Especially if you plan to move into Independent Living before you have access to your Social Security, you’ll want to have a clear idea of your investment potential to ensure your ability to personally cover the costs of Independent Living. A financial advisor can help you assess where your savings and investments are today, and what options are available to you as a result. 

3. Create a Budget

Having an established budget for your life now will make it easier to consistently set aside money for later on in your retirement life. Outline all of your essential needs, including food, housing, and health care, and calculate those costs first and foremost. Once you know the essentials, you can budget out the less essential items that you want to account for such as travel, hobbies, and entertainment. This budget can help you see where to best allocate your money for your future care too.

4. Prepare for Long-Term Needs

Although you may be able to live fully independently now, there may come a day when you require extra support in your everyday life. Because Assisted Living can be more costly, you should plan for this possibility in your budget and consider how much you may need to cover after Social Security, Medicaid, and insurance. It can help to think of this from a “scenario planning” standpoint. Think through the “best case scenario,” of course, but also consider a plan for how you’ll handle things if something unexpected happens, like an unexpected diagnosis or a shift in the stock market, and you need to move forward differently.

5. Ready to Move? Start by Downsizing!

Once you’re ready to move into Independent Living, you’ll likely need to downsize for the practical purpose of switching from a full-sized house to a spacious apartment. Downsizing also has the added benefit of building up extra savings by selling large furniture pieces and other items you will no longer need!


Start Planning Now, No Matter Your Age

Whether you’re retired now, or if retirement is still decades away, it’s never too early to start planning! The more you can save, invest, and prepare your finances now, the easier it will be to transition into a peaceful and thriving retirement when the time comes.

If you’re already in a place where you want to experience the benefits of a senior living community, contact us to learn more about Independent Living at St. Anthony’s and schedule a tour of our beautiful Kansas City campus!