The cost of aging in place: financial planning for long-term independence

It’s natural to want to stay in the place that feels most like you — the home where your memories live, where your routines bring comfort, and where you feel most in control. That’s what aging in place is really about: preserving not just your independence, but your sense of self. 

But we also know that holding onto that independence comes with real-life decisions, especially when it comes to finances. From modifying your home for safety to covering in-home care and everyday expenses, the cost of aging in place can vary widely. And it’s not always easy to know where to begin. 

Whether you're just starting to explore this path or already making thoughtful adjustments, having a clear plan can make all the difference. We’re here to help you understand what to expect — and how to prepare — so you can make choices with confidence and care. 

The costs of aging in place can sometimes be more affordable than moving into an assisted living community or nursing home, but it can vary depending on your location and the level of care you require.

Aging in place means you can enjoy your life right in the comfort of your home. As you age, your care needs might increase. 

And that’s OK — we all need a little extra help eventually. If you are planning to stay in your home as you age, you might want to consider in-home care. 

According to our Cost of Care survey, the average national hourly rate for a home health aide in 2024 was $34. 

Some of the things that were easy such as getting dressed, bathing, and other activities of daily living (ADLs) or instrumental activities of daily living (IADLs) might become more challenging which is why in-home care might be a good choice for you. 

Your home that once felt perfectly functional may need adjustments so it can continue to stay comfortable and accessible. The good news is that you can make many of these home modifications gradually, customizing them to your specific needs. 

Here are some common modifications to consider: 

• Grab bars in bathrooms 

• Toilet seats 

• Railings along stairs 

• Wider doorways for wheelchair or walker access  

• Stairlifts 

• Walk-in tubs or showers  

• Ramps

Some of these upgrades are one-time investments that pay off over the years. Others may require ongoing maintenance. Either way, they’re essential in creating a space that supports your independence in the long term. 

Whether you choose to remain in your home or move into a care community, the key is to plan ahead. Think about what you need now, as well as what you may need down the road. By building your care strategy early, you can: 

• Explore your options without pressure 

• Understand what resources are available to you 

• Create a flexible plan that grows and adapts with your needs

With thoughtful preparation and a little support, you can make confident choices that honor your independence and help you live life on your terms. 

Thinking about long-term care doesn’t have to feel daunting. Instead, it can be a hopeful, empowering process because it gives you the chance to shape the life you want to live as you age.  

When you plan ahead, you’re not just preparing for future needs — you’re protecting your independence and peace of mind.  

To that end, here are a few key ways to budget confidently and enjoy the benefits of aging in place. 

There are a number of insurance plans and benefits that can help cover parts of your care at home. Understanding what’s available (and what’s not) can make a big difference in your planning.

• Medicare – Medicare is a great resource for covering some medical services in the home, like visits from a nurse or the cost of medical equipment. However, it doesn’t usually cover personal care services like help with bathing or cooking, unless they're tied directly to a medical need.¹

• Medicaid – Depending on your state and eligibility, Medicaid can offer more comprehensive support, especially if you need help with daily activities.² Some states even offer waiver programs that allow funds to be used for in-home care instead of external care.

• Long-term care insurance – This is a type of policy you may already have, or want to look into, that’s designed specifically to cover long-term care services such as home care or assisted living. These policies vary widely, so reviewing the details with a financial advisor is a good idea.

• Veterans benefits – Veterans benefits are another valuable resource. If you or your spouse served in the military, you may be eligible for extra support through the VA, including assistance at home through the Aid and Attendance program.³

These insurance options can help lighten your financial load, but they’re just one piece of the puzzle. 

Budgeting for long-term care is really about giving yourself choices. That’s why saving for future care, just like you might have saved for retirement or travel, is so important.

• Health Savings Account – If you’ve been contributing to a Health Savings Account (HSA), you can use those funds for qualified medical expenses, including some in-home care services.⁴

• Retirement accounts – Retirement accounts, like IRAs or 401(k)s, can help cover health and home expenses. It’s a good idea to set aside a portion specifically for care needs, so you’re not caught off guard down the line.

• Home equity – Your home equity can also be a powerful resource. For many older adults, their home is their biggest financial asset. While options like reverse mortgages or home equity lines of credit can help tap into that value, they do come with fine print, so be sure to talk to a trusted advisor before moving forward.

What matters most is knowing where you stand and creating a plan that reflects your values, your lifestyle, and your goals. 

There’s also a wide network of government programs designed to help older adults stay safe, supported, and independent at home.

• PACE (Program of All-Inclusive Care for the Elderly) – PACE offers coordinated medical and social services for people who qualify. It’s a great option for those who need more hands-on support but still want to live at home.⁵

• State and local area agencies on aging – These resources often provide home-delivered meals, transportation to medical appointments, and even caregiver support, sometimes at no cost. Every community is different, so reaching out to your local agency can help you tap into what’s available in your area.

• Supplemental Security Income (SSI) — SSI can also help if you’re on a limited income, providing monthly support for basic living expenses.⁶

Don’t hesitate to ask for help when navigating these programs. There are professionals and advocates ready to walk you through the process and make sure you’re getting all the support you’re entitled to.  

Aging in place is all about maintaining control over your life and environment as you grow older. By understanding the costs and taking a proactive approach to financial planning, you can preserve your independence while managing the necessary expenses. Whether it’s through home modifications, in-home care, or insurance options, having a clear strategy in place will allow you to stay in the home you love with confidence. Remember, the right planning now can help ensure that your future is just as comfortable and secure as your present.