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How to Pay for Independent Living

Written by Michaela Kitchen
 about the author
5 minute readLast updated April 4, 2023
Reviewed by Lucinda OrtigaoLucinda Ortigao is President of Cape Investment Consulting Inc. and is a certified financial planner.

Independent living communities cater to seniors who do not need personal care or nursing care. Amenities at these communities provide your loved one with opportunities to make new friends, enjoy new experiences, and have a sense of belonging. When considering how to pay for independent living, there are various options like using personal funds, leveraging their current home, and more.

Key Takeaways

  1. Independent living caters to seniors who do not need personal or nursing care. Independent living communities often offer amenities and services to make seniors’ lives easier.
  2. There are more costs to consider than just rent and utilities. Many senior communities offer meal packages and activities programs that can add to monthly expenses.
  3. There’s more than one way to find funds to pay for independent living. Whether using personal funds already saved or selling assets, there are ways for families to come up with cash.
  4. There’s also governmental assistance available. By utilizing assistance programs like Supplemental Security Income or veterans benefits, paying for independent living is achievable.

Ways to pay for independent living

There are many ways to pay for independent living depending on your loved one’s finances. Choosing the right option for their situation can make moving into independent living smoother.

Personal funds

The most straightforward way to pay for independent living is with private funds. If that’s an option for your parent, funds from a personal checking or savings account can be a direct way to cover rent and other costs.

Home equity

If your parent owns their home outright that they no longer want or need, consider selling it to to pay for independent living. A bridge loan may help cover costs in a slow housing market. You and your loved one may also consider renting the home to others to generate income that could help pay for independent living.

Using life insurance

Your loved one can access the funds in their life insurance policy through a process called a life settlement. This option allows a policy to be sold to an investor for more than its cash value.[01] Another option available to policy holders is to take an early withdrawal. This option allows policy holders to withdraw funds tax-free as long as the amount doesn’t surpass the amount your parent has paid in premiums. But, with this option, if the loan and interest aren’t paid before death, the loan balance and fees are deducted from the death benefit.[02]

Let our care assessment guide you

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Veterans pension

This program provides monthly payments to qualified veterans over age 65. To receive this benefit, veterans must meet age and disability requirements and have a net worth and income within certain limits. Veterans can apply directly through the Department of Veterans Affairs website for this benefit.[03]
Veterans with service-related disabilities or their surviving spouses may be eligible for additional VA benefits that can be used to pay for independent living. Reach out to your loved one’s local veteran services officer for assistance with navigating the eligibility and application process.

Housing Choice Voucher Program — Section 8

This federal housing voucher program helps low-income families, the elderly, and disabled people afford decent, safe, and sanitary housing in the private market. To qualify, your loved one’s income cannot exceed 50% of the median income for the county or metropolitan area in which they live. Applications can be completed by contacting their local public housing agency.[04] Not all independent living communities will accept a Section 8 waiver, so contact the community your parent is interested in for more information.

Social Security retirement benefits

Social Security retirement benefits replace a percentage of seniors’ pre-retirement income with a monthly check. Money from Social Security can be used for any expenses, including paying for independent living. The Social Security Administration website provides guidance on eligibility and application.

Do Medicare and Medicaid cover independent living?

No. Since Medicare and Medicaid are forms of health insurance, neither covers the costs of independent living.

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Ways to save money on independent living

Independent living communities often feature on-site amenities like fitness centers, barber shops and beauty salons, outdoor recreational spaces, and more. Along with convenient amenities, independent living can add convenience to your parent’s life through meal and transportation services.
While moving costs, monthly rent, and utilities are the primary expenses that must be paid for, consider add-on services that might enhance your loved one’s quality of life in independent living. Although these services might cost extra, they can ensure your parent can enjoy a hassle-free lifestyle that provides them with opportunities to be a part of their new community. Depending on the independent living community your parent decides on, there may be various floor plans and financial and lifestyle packages they can choose from.

Look for a la carte pricing

While some communities may offer all-inclusive pricing that allows residents to pay for rent, utilities, services, and amenities together, other communities may offer a la carte pricing. This allows residents to add individual services as they choose according to their budget.
Some a la carte community offerings might include:
  • Meal plans. Although each community’s dining packages will differ, most will have various options to fit your parent’s nutritional and lifestyle needs like vegan, halal, kosher, or allergen-free meals. Meal frequency, nutritional specifications, and other customized factors will influence the cost of meal plans. If your parent still cooks for themselves, they may not need to pay for these packages, as many communities feature kitchens in the suites.
  • Group activities. Many communities plan entertainment, events, outings, and group activities for residents, but there may be additional costs for these. If your parent enjoys being social and will want to participate in community activities or programs, ask prospective communities if they charge extra for those experiences.
  • Transportation services. Each community’s transportation services may be different, but it is common for complimentary transportation to be offered on a set schedule for residents. If residents need transportation outside of that schedule, there may be additional fees.

Compare floorplans and pricing

If only one parent is moving to independent living, consider the apartment size and layout that will work best for them and their budget. Larger units typically cost more than smaller units.

Consider roommates

Your loved one can also choose to live with a suite mate. Sharing an apartment and splitting costs can help seniors save money on independent living .

Senior living advice 

For a better understanding of payment options and help finding the right community for your loved one, connect with a Senior Care Advisor. These local senior living experts will provide one-on-one guidance and connect you with nearby communities that fit your loved one’s needs and budget.


  1. Elder Law Answers. (2019, July 12). Should you sell your life insurance policy?

  2. Egan, J. (2020, December 10). Can I Withdraw Money From My Life Insurance?Experian.

  3. U.S. Department of Veterans Affairs. (2022, October 12). Eligibility for Veterans Pensions.

  4. U.S. Department of Housing and Urban Development. Housing choice vouchers fact sheet.

Meet the Author
Michaela Kitchen

Michaela Kitchen is a copywriter at OurParents. She focuses on senior living trends, resources relevant to the families of seniors, senior lifestyle tips, and health care. Previously, she worked in television and print journalism, social media management, and marketing. She holds a bachelor's degree from Kansas State University in journalism and mass communication.

Reviewed byLucinda Ortigao

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