Performing a Cost-Benefit Analysis for Senior Care
Finding the right senior care option is complicated. There are a number of different types of senior care to choose from, as well as a number of communities offering care in your area for each. How are you supposed to figure out which option is right for your parent or senior loved one?
On top of all that, with senior care costs on the rise, how do you figure out which is the best one for the cost? Performing a cost-benefit analysis of your senior care options won’t necessarily make the choice easy for you, but it will help your family make a more informed decision.
4 Steps to Take to Perform a Cost-Benefit Analysis for Senior Care
Here are four steps that you can take to make the decision a bit more manageable:
Step 1: Consider the costs of local senior care options.
The first thing you need to do is figure out what kinds of costs you’re looking at in your area. You can use Senior Advisor to search nearby assisted living communities, memory care options, in-home care companies, independent living communities and nursing homes.
Make a note of the general price ranges for each type of senior care option so you can start off the process with a general understanding of the costs you’ll be dealing with. But don’t spend too much time looking at the specifics of the different companies at this point – you don’t want to end up falling in love with an option that’s out of your price range.
Step 2: Determine what you can reasonably afford.
Now it’s time to do some math. Look at what you have in retirement savings and social security payments. Consider any other assets you have that may help cover the costs – if you own your home, for example, you can add more money to your budget by renting it out or selling it. If you have long-term care insurance, then look over your policy to see how much you can expect it to cover.
The goal after reviewing all this information is to come up with a monthly number. What can you afford to pay each month, assuming you’ll need to invest in senior care for years to come? Once you have that number, you can more easily narrow down your options to those that are within your price range.
Step 3: Look at your loved one’s needs and priorities.
Clearly, the price isn’t the only factor to consider here or even necessarily the most important. You need to find the right balance between affordability and quality of life. First, think carefully about what your loved one needs.
It can be helpful to think in terms of ADLs; go through the list and figure out which particular ADLs your loved one needs help with now and which ones there’s a decent chance they’ll need help with down the line. If they’ve received a dementia diagnosis, then you should specifically seek out memory care options. But in addition to needs, you also have to think about your loved one’s desires. Decide how much weight to give different factors like how close the location is to loved ones, whether or not there’s a garden, if the community pet-friendly, etc.
Step 4: Make a list of the senior care options you can afford and the features they each offer.
Now you know what you can afford, you know what you need and you know what you want. Return to the listings on Senior Advisor, limit your results by the price range you can afford and start looking at the details the senior care options available.
Rank the listings based on how close they come to your loved one’s priorities so you can narrow your options down to a list of those that come closest to meeting your needs. You can use your rankings to help you figure out which of your local options is the best value for the cost based on your particular needs and preferences.
Although you’ll almost certainly have to make some compromises, performing a cost-benefit analysis like this can help make a difficult, overwhelming decision a bit more manageable.