Most families who care for someone living with dementia use a combination of private and public resources to pay for memory care. Private options include income and assets such as pensions, home equity, Social Security retirement and disability benefits, and funds from life insurance or long-term care insurance policies. Some seniors also qualify for public assistance programs, such as Medicaid, Supplemental Security Income (SSI), and veterans benefits that can help cover the cost of memory care. The median monthly cost of memory care in the U.S. in 2026 is $6,690, according to A Place for Mom’s proprietary cost data.
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Most families use a combination of private funding sources and income from publicly funded benefit programs to pay for memory care. The sections below explain the most common ways families cover memory care costs and how these options are often used together.
Many families cover the cost of memory care using money their loved one has saved, but sometimes that’s not enough. When Heather Q.’s 75-year-old mother needed memory care because of worsening dementia, the only money available was her mother’s small savings and retirement account and it wasn’t enough to cover the cost.
Heather and her sister are researching ways to pay for memory care.
“We’re still figuring it all out,” says Heather, adding that they have made one decision. “We’re planning to sell her house.”
Other sources of personal funds include:
“Families most often combine payment sources like the senior’s income, savings, sale of a home, and any stocks or retirement portfolios,” says Beth Wilkison, a learning and development manager at A Place for Mom, who has two decades of experience working with families in memory care and other senior living communities.
As mentioned, your loved one’s home can be used as a source of funds to pay for memory care. For example:
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Certain types of insurance policies may be used to help pay for a loved one’s stay in a memory care community.
Long-term care insurance policies are used to pay for long-term care needs, which can include a memory care community. Policies differ on what they cover, so ask your loved one’s insurer whether memory care is covered.
It’s important to understand that your loved one must have purchased a long-term care insurance policy before they need long-term care. Mid-50s, when one is in relatively good health, is generally the best age to buy a policy.[03]
Life insurance policies may be used to cover memory care costs in a few ways. For example, a policyholder can sell their policy to a third party and use the proceeds to fund memory care. Or a life insurance policy may be surrendered to the insurance company for its cash value.
However, using life insurance to fund memory care can involve relinquishing policy ownership, which means beneficiaries won’t receive benefits upon the insured’s death.
Social Security retirement benefits and Social Security Disability Insurance (SSDI) are two programs administered by the U.S. federal government. The monthly benefit amount for each program depends on how much a person pays into the Social Security fund during their working life.
Social Security benefits are an important source of income for older Americans.
Social Security retirement benefits are provided to people and their spouses who are at least 62 years of age and who have worked and paid into the Social Security system long enough to qualify. The average monthly Social Security retirement benefit in 2026 is about $2,071, or less than one-half the national median cost of memory care in 2026.
Social Security Disability Insurance (SSDI) is for people who are no longer able to work because of a disability that’s expected to last longer than one year or result in death. The disability must also prevent them from doing work they’ve done in the past and from adjusting to other types of work. In 2026, the average monthly SSDI benefit is about $1,960.[06] Once someone who is receiving SSDI benefits reaches full retirement age, their monthly payment is converted to the Social Security retirement benefit.[07]
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Two important publicly funded programs that can be used to pay for memory care include Medicaid and Supplemental Security Income (SSI). Both programs rely on federal and state funding. Often, people who qualify for SSI also qualify for Medicaid.
Medicaid is a health insurance program that’s jointly funded and managed by federal and state governments and designed to support people who have limited income and financial resources. While Medicaid won’t pay for room and board in a memory care community, most state Medicaid programs will cover personal and health care services for residents of memory care communities. They do so in two ways:
It’s important to understand how a state’s regular or ABD Medicaid plan differs from its HCBS waiver programs. Regular or ABD Medicaid is considered an entitlement, meaning that all eligible residents will receive services. HCBS waivers are not entitlements, which means that program space is limited and there may be a waitlist.
In both cases, eligibility requirements apply. These often include:
Medicaid is often confused with Medicare, but they’re not the same thing. Medicare is a federal health insurance program for people over 65 and for younger people who have certain conditions. Medicare won’t cover room and board in a memory care community.[11] It may, however, cover certain medically necessary products and services that seniors living in memory care communities need, such as skilled nursing care, durable medical equipment, and medications.
The SSI program is designed for people who have low incomes and who are disabled or who are 65 or older. There is no work history requirement to receive SSI benefits. Monthly benefit amounts depend on a person’s income, assets, living situation, and other factors. In 2026, the average monthly SSI payment is $994 for someone 65 or older.[06] Some states also provide financial support in addition to federal SSI payments.[12]
The U.S. Department of Veterans Affairs (VA) offers several benefit programs that can help eligible veterans and their surviving spouses cover the cost of memory care. VA programs that can help pay for memory care in a facility include:
A single veteran who qualifies for Aid and Attendance can receive up to $2,424 per month.[16] A surviving spouse who qualifies for Aid and Attendance can receive up to $1,558 per month.[17] Exact pension amounts depend on a veteran’s or surviving spouse’s income, the number of dependents they have, and other factors.
In addition to the payment sources described above, families also frequently contribute to the cost of an aging parent’s stay in a memory care community.
“We’re seeing lots of families paying out-of-pocket these days,” says Wilkison. “Once the other payment sources have been exhausted, [their adult children] are taking what’s left and dividing it so that each contributes to the total cost.”
As a loved one’s condition progresses, the cost of required care services typically increases, often exhausting a family’s resources. Before the situation gets to that point, it can be helpful to talk with a financial professional who knows your loved one’s finances and can help you identify current and future options. Senior living experts who have helped families navigate payment options for care are also a good resource.
A Place for Mom’s Senior Living Advisors are experienced with the many private and publicly funded payment options and can help your family work within your budget to pay for memory care. They can also answer any questions you have about memory care and other types of senior living at no cost to your family.
The average length of stay in memory care ranges from two to ten years, depending on factors such as the progression of the senior’s dementia, and their overall health.
Families with a loved one who requires memory care often combine private and public resources to cover the cost, including pensions, home equity, Social Security retirement and disability benefits, and life insurance or long-term care insurance funds.
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A Place for Mom. (2026). Costs of long-term care and senior living.
Social Security Administration. 2026 Social Security changes.
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Healthinsurance.org. Medicaid for the aged, blind and disabled (ABD).
U.S. Centers for Medicare & Medicaid Services. Home and community-based services. Medicaid.gov.
U.S. Centers for Medicare & Medicaid Services. Home and community-based services 1915(c). Medicaid.gov.
U.S. Centers for Medicare and Medicaid Services. Get started with Medicare. Medicare.gov.
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U.S. Department of Veterans Affairs. (2025, July 18). Eligibility for Veterans Pension.
U.S. Department of Veterans Affairs. (2025, July 18). Eligibility for Veterans Pension.
U.S. Department of Veterans Affairs. (2026, January 15). VA Aid and Attendance benefits and Housebound allowance.
U.S. Department of Veterans Affairs. (2025, December 18). Current pension rates for veterans.
U.S. Department of Veterans Affairs. (2026, January 13). Current Survivors Pension benefit rates.
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