How to Find Low-Income Assisted Living on a Fixed Budget

Ask any older adult about financial planning for retirement, and you're likely to hear a common concern: the rising cost of senior living and associated care services. Seniorly data shows that the average cost of assisted living in 2020 is $3,931. This could be prohibitively expensive to seniors on a fixed income.

As the cost of assisted living facilities continue to rise, finding low-income assisted living options becomes essential to ensure elderly loved ones receive the care they need while staying within budget. For those who depend on a fixed income, navigating the maze of affordable senior care solutions can be daunting.

Most assisted living facilities offer a range of services that can help make life easier for the elderly, but unfortunately, they often come with a steep price tag. However, with the right tools, resources, and information, finding a suitable and affordable assisted living community for your elderly loved ones is possible, even on a tight budget. Let's start with the basics.

What does “low income” mean when it comes to older adults?

The US Department of Housing and Urban Development (HUD) sets dollar amount limits to define “low income” and “very low income.” These income limits are used to determine the income eligibility of applicants for Public Housing, Section 8, and other programs for low income seniors and others.

The limits are partly defined by family size and the area in which you live, since the cost of living can vary so widely across the country. Larger families can have a larger income and still be considered low or very low income, depending on where they live.

“Low income” refers to a family income that is 80 percent of the median family income for the area

“Very low income” refers to a family income that is 50 percent of the median family income for the area

A note on median income

If the median salary in a senior’s home county is, for example, $43,000, then a senior would need an income of $34,400 (80% of the median) to qualify as low income (and $21,500 to qualify as very low income).

When HUD and other government agencies evaluate your income eligibility, they look at all income streams, including retirement accounts, real estate, IRAs, insurance annuities, Social Security, and pensions.

(The median is the value that separates the higher half from the lower half of a data sample. You could think of it as the “halfway point” or middle value in a range of numbers. This is a more accurate way of setting income standards than an average, which might skew very high in some areas and very low in others.)

Types of low income assisted living facilities and senior living options

Senior housing can be roughly categorized into housing with and without supportive services or personal care services.

Senior apartments

These apartment-living options can provide budget-friendly housing and senior community option for older adults. Senior apartments are typically designed for those seniors that can still live independently, and can offer socialization opportunities and freedom from home maintenance and housekeeping, but they do not provide assisted living service or support for activities of daily living (ADLs).

Department of Housing and Urban Development (HUD) options

Fortunately, the government can help to subsidize senior housing for those who need financial assistance. Here’s a quick breakdown of the housing and urban development options:

Senior Housing

HUD-sponsored subsidized senior housing, governed by the U.S. Department of Housing and Urban Development (HUD), is an affordable housing program specifically designed for low-income seniors aged 62 and above. These housing options offer multiple benefits, such as reduced rental rates and financial assistance, to ensure that seniors can live comfortably and securely within their means. Typically, residents of HUD-sponsored housing units pay just 30% of their adjusted gross income toward their rent, with the government subsidizing the remaining cost. This program not only provides a financial lifeline for older adults on fixed incomes but also fosters a supportive, age-restricted community where seniors can enjoy a sense of safety and camaraderie.

Low-Income Housing Tax Credit (LIHTC)

Assisted living facilities who participate in HUD programs can offer senior housing by setting aside a specific number of units for low income seniors. Seniors can qualify if they meet the HUD income requirements.

Housing Choice Voucher Program

The Housing Choice Voucher Program, also known as Section 8, is a federal assistance initiative aimed at providing affordable and safe housing for low-income families, the elderly, and individuals with disabilities. Administered by local public housing agencies (PHAs), the program offers rental vouchers that older adults can use top pay rent for the privately-owned housing of their choice. The value of the voucher is based on an income-adjusted calculation, with seniors typically paying around 30% of their adjusted monthly income towards rent, while the government covers the remainder.

Section 202 Supportive Housing Program

The Section 202 Supportive Housing for the Elderly Program is a federal initiative designed to address the unique housing and care needs of those classified as "very low income" seniors. Managed by the U.S. Department of Housing and Urban Development (HUD), the program supports the development and operation of affordable, supportive housing communities that offer a range of on-site services tailored to the needs of older adults. In addition to providing rental assistance, the 202 Program fosters an environment that promotes socialization, accessibility, and safety, all of which are essential for seniors to age in place with dignity. This comprehensive approach ensures that vulnerable seniors have access to comfortable, affordable housing while benefitting from various services such as health care, transportation, and recreational activities, ultimately enhancing their overall well-being.While Section 202 housing is an excellent option for those looking for assisted living, it typically has long waitlists.

How to qualify for government-funded assisted living facility options

Fortunately, there are viable housing options for low-income seniors looking for assistance with assisted living costs. Each low-income senior housing option has different guidelines, income limits, and eligibility requirements and must be evaluated independently.

To get some help with finding affordable assisted living options in your area, contact your local Area Agency on Aging. These services can be a huge asset when trying to navigate the world of government benefits and ensuring you are following the correct application process.

Can Veterans benefits be used toward assisted living?

A Veteran’s benefit called Aid and Attendance can be used by seniors who need help with assisted living-type care. Qualifying seniors who need help with activities of daily living (getting dressed, bathing, toileting, etc.) can use Aid and Attendance to receive this level of care in facilities or personal care at home. These seniors must be low income according to VA guidelines in order to qualify for this benefit, however.

[Read More: Assisted Living Benefits for Veterans]

Can financial assistance like Medicaid help with assisted living costs?

Although Medicaid can offer assistance with the type of services provided by assisted living, it does not pay for community rent itself. State waivers are exceptions to this, but their coverage and requirements vary from state to state. And although many states do offer Medicaid waivers that can help with assisted living costs, not all do.

Below is one example of a state’s assisted living waiver—contact your local Medicaid office to learn more about what’s available in your state.

California Medi-Cal: low-income assisted living support

Luckily for California state residents, Medi-Cal provides benefits to the elderly and financial support for low-income assisted living options. According to California Advocates for Nursing Home Reform, the new Assisted Living Waiver (ALW) allows Medi-Cal to be able to pay for assisted living care for qualified residents.

As noted on the website, “A key goal of the program was to enable low-income, Medi-Cal eligible seniors and persons with disabilities, who would otherwise require nursing facility services, to remain in or relocate to a community setting in a Residential Care Facility for the Elderly (RCFE) or public subsidized housing.”

The Medi-Cal affordable housing program allows people in need to find suitable assisted living services, regardless of their background or financial status. Some services provided for Medi-Cal ALW participants include:

• Personal assistance and help with daily living activities
• Laundry services
• Housekeeping services
• Skilled nursing care
• Daily meals and drinks/snacks
• Transportation
• Recreational activities
• Social services

In terms of payment, participants in the ALW program will pay for their own room and board at the chosen assisted living community, while Medi-Cal will pay for medical care and other services. According to the California Assisted Living Association (CALA), the total payment standard for Supplemental Social Security Income (SSI) and State Supplementary Program (SSP) is $1,173.37 for non-medical out-of-home care.

This payment standard covers the following expenses:

• Room and board: $505.37
• Care and supervision: $534
• Basic services: $1039.37
• Personal and incidental needs: $134

For more information on who qualifies for low-income assisted living support and how to apply, contact the California Department of Health Care Services or the appropriate department in your home state. Everyone deserves quality care in their old age.

More resources and support services to find affordable senior housing options

Although low-income senior care options are not as widely available as they should be, there are programs and services that can help you find the help you or your loved one. If you’d like assistance finding affordable senior housing, contact your local HUD rental office.

Additionally, we've put together lists of local resources in a number of big cities. These resources can help seniors and caregivers get in touch with local experts who can help you navigate government-funded assisted living programs and figure out whether your loved one qualifies for aid. These local organizations and services can also offer fun activities, support, and the opportunity to meet other seniors and caretakers.