Maybe you've toured a community or two. Maybe you've started comparing assisted living in Highland Park to memory care options near Deerfield or Evanston. You're getting a clearer picture of what your loved one needs—but there's a number on a brochure that keeps nagging at you.
Can we actually afford this?
You're not alone in asking. For most families on the North Shore, figuring out how to fund senior living is the single biggest sticking point in the decision-making process. The good news is that there are more financial paths than most people realize—and understanding them early gives you a significant advantage.
This guide breaks down the most common ways families pay for assisted living and memory care, explains who each option works best for, and gives you a framework for talking to a financial advisor.
Before diving into payment methods, it helps to understand what senior living costs actually cover. When you see a monthly rate for assisted living or memory care, that number typically bundles together:
Housing — a private apartment or suite
Meals and nutrition — usually three per day, plus snacks
Personal care assistance — help with bathing, dressing, and medication management
Activities and programming — social, physical, and cognitive engagement
Housekeeping and maintenance — no more worrying about the furnace or the lawn
24/7 staffing and safety features — trained team members always on site
When you add up what it costs to replicate all of that at home—private aides, meal delivery, home modifications, emergency response systems—the gap is often smaller than families expect. You can compare the true costs of staying at home versus moving to senior living to see how the numbers stack up for your situation.
Every family's financial picture is different. Here are the most common funding sources, along with who each one is best suited for.
This is the most straightforward option. Families use a combination of retirement savings, Social Security income, pensions, and investment accounts to cover monthly costs.
Best for: Families who have been saving for retirement and can comfortably cover the monthly rate from existing income and assets.
What to know: Many families combine private pay with one or more of the options below to stretch their resources further.
For many seniors in communities like Highland Park, Glencoe, Winnetka, and Wilmette, the family home is their single largest asset. Selling it can free up significant capital to fund years of senior living.
Best for: Homeowners who no longer need (or can safely maintain) their home. North Shore real estate values can make this an especially powerful option.
What to know: A financial advisor can help you weigh the tax implications and timing. Some families use a bridge loan (see below) to cover costs while the home is on the market.
If your loved one purchased a long-term care insurance policy years ago, now is the time to review it. These policies often cover a daily or monthly benefit for assisted living and memory care, though the specifics vary widely.
Best for: Families whose loved one already holds an active policy. (Unfortunately, these policies are difficult and expensive to purchase later in life.)
What to know: Review the policy's elimination period (the waiting period before benefits kick in), daily benefit amount, and any requirements for qualifying. The community's team can often help you navigate the claims process.
The VA's Aid & Attendance pension benefit is one of the most underused resources available. It provides a monthly stipend to wartime veterans—or their surviving spouses—who need help with daily activities. In 2024, the benefit can exceed $2,700 per month for a veteran with a spouse.
Best for: Veterans of wartime service (or their surviving spouses) who meet income and asset thresholds. Many seniors in the North Shore area qualify without realizing it.
What to know: The application process can take several months, so it's wise to start early. An accredited VA claims agent or veterans service organization can help.
Many people don't realize that certain life insurance policies can be converted into a benefit that pays for long-term care. Through a life settlement or an accelerated death benefit rider, families can access funds from a policy while the insured person is still living.
Best for: Families whose loved one holds a life insurance policy that is no longer needed for its original purpose (such as replacing income for dependents).
What to know: Not all policies qualify, and the payout is typically less than the full death benefit. A financial advisor experienced in elder care planning can evaluate whether this makes sense.
A bridge loan provides short-term funds—often while a home sale is in progress—so families don't have to delay a move. Some lenders specialize in senior living bridge financing.
Best for: Families who need to move quickly but are waiting on a home sale or another asset to become liquid.
What to know: Interest rates and terms vary, so compare options carefully.
A financial advisor who understands elder care can be one of your most valuable partners in this process. Here are questions worth asking:
How long can our current assets sustain assisted living or memory care costs? Ask for projections under different scenarios.
What's the most tax-efficient way to fund care? The order in which you draw from different accounts matters.
Are there Medicaid planning strategies we should consider now? Illinois Medicaid can cover some long-term care costs, but eligibility rules are strict and planning ahead is critical.
Should we sell the home now or later? Timing affects both the sale price and the tax impact.
How do we coordinate benefits? If your family has access to VA benefits, long-term care insurance, and personal savings, an advisor can help you layer them strategically.
Financial planning goes hand-in-hand with legal planning—download our step-by-step guide to make sure your legal documents are in order before meeting with your advisor.
For many families, the financial conversation is even harder than the care conversation. There can be guilt, fear, disagreements about inheritance, and uncertainty about what a parent actually wants.
A few things that help:
Start with shared goals. Everyone at the table likely wants the same thing: safety, comfort, and quality of life for your loved one. Lead with that.
Be transparent about the numbers. Vague conversations lead to anxiety. Concrete information—even when the numbers feel daunting—leads to better decisions.
Include your loved one whenever possible. Older adults deserve a voice in how their resources are used. Their preferences matter.
Divide the research. One family member can investigate VA benefits while another contacts the insurance company. Sharing the workload prevents burnout.
If you need help starting the conversation about care and finances with your family, this guide can help.
Understanding your payment options is one of the most empowering things you can do as you explore senior living for someone you love. You don't need to have every answer figured out before you reach out—communities like Arbor Terrace Highland Park are experienced in walking families through the financial side of the decision.
If you're still learning about what assisted living actually includes, download our complete guide to assisted living for a clear overview of services, daily life, and what to expect.
When you're ready to talk specifics, our Highland Park team can help you understand costs, explore what financial resources you may have available, and create a plan that works for your family.