Building a monthly budget for assisted living

The community's fee schedule is only part of what your parent will spend each month. Pharmacy copays, insurance premiums, a phone plan, haircuts and the old house's utilities keep arriving too. If you build the budget from the community's quote alone, the savings run out sooner than anyone expected. This post gives you the full worksheet, line by line, then the runway calculation and a routine for keeping it current.

The cost side: every line to include

Group the costs so nothing slips through. Fill in real figures where you have them and mark estimates as estimates.

For the community lines, ask for the written list of what the base fee includes and what each additional service costs. Some states require a standard disclosure; Virginia's form, for example, lists the services in the base fee and each service outside it with its fee. The costs families don't see coming post goes through the extras that most often surprise people.

Add a second column called "next level." Ask the community what your parent's bill would be one care level up, and fill that in beside today's figure. Care needs can change, and seeing both columns side by side keeps the family from planning around the lowest number on the fee schedule.

Keep one-time costs, such as the community fee, movers and attorney fees, out of the monthly budget. Track them separately so they don't distort the monthly gap.

The income side: what reliably arrives

List only money that arrives every month, in the amount that actually lands in the account:

• Social Security, after any premiums deducted from it
• Pensions and annuity payments
• VA pension, including Aid and Attendance, once approved
• Long-term care insurance benefits, once the elimination period is over
• Rental income from the house, net of costs
• Regular family contributions, if agreed in writing
• Required or planned withdrawals from retirement accounts (ask a tax professional about the tax on them)

Don't count a benefit until it's approved. If a VA claim or insurance claim is pending, run the budget both with and without it, and note the date you expect a decision next to that line.

The gap and the runway

Two calculations tell you most of what you need:

1. Monthly gap = total monthly costs minus total monthly income.
2. Runway in months = savings available for care divided by the monthly gap.

A hypothetical example: say the community bill is $6,200 (the same as the 2025 national median in the CareScout survey), outside costs add $700, and income is $3,100. The gap is $3,800 a month. With $120,000 available, the runway is about 31 months. Filled in, that budget might look like this (all figures hypothetical except the 2026 Part B premium):

Notice how much of the gap sits outside the community bill: $700 a month here, or $8,400 a year. Leaving those lines out would overstate the runway by about seven months in this example (38 months instead of 31).

Now make it realistic. Rates rise, and care needs can grow. Rerun the calculation with a yearly increase and with the next care level up; the rent increases post has a simple table for this. If the realistic runway is under a few years, start the conversations covered in what happens when the money runs out now, while there's time.

Where to find the real numbers

A budget built from memory is always too low. Gather these once, and the numbers get much better:

• Social Security benefit letter and the latest deposit amount
• Pension and annuity statements
• Insurance cards and premium notices for every health, drug and supplemental plan
• Pharmacy history for the last 6 to 12 months
• The community's fee schedule and your parent's care-level assessment
• Three months of bank and credit card statements, to catch recurring charges and subscriptions
• Property tax, homeowner's insurance and utility bills for the house

One account, clear roles

Budgets fall apart when bills come from three accounts and two people pay them. A simpler setup:

• One account in your parent's name receives income and pays the community, pharmacy and premiums.
• One person is responsible for paying bills, ideally the person with legal authority to act (an agent under a power of attorney, or a trustee).
• Autopay for fixed bills, with alerts sent to a second family member.
• A written record of every payment and every family contribution.

If you manage money for your parent as an agent, trustee or representative payee, the CFPB's free "Managing Someone Else's Money" guides explain your duties for each role. For the practical side of paying bills from another city, see managing a parent's bills from far away.

When to update the budget

Review it monthly for the first three months, while real bills replace estimates, then at least quarterly. Update it immediately after any of these:

• A rate increase notice or a care-level change
• A hospital or rehab stay
• A benefit decision (VA, Medicaid, insurance)
• The house selling or being rented
• A family member changing what they contribute

Each month, put the new community statement next to last month's and compare line by line. Look for new lines, changed amounts and one-off charges, and ask the business office about anything you can't match to a service your parent actually used. Small charges add up over a year.

What to say at the family check-in: "Here's this quarter's budget. Mom's costs went up $240 a month after her care level changed, which takes a couple of months off the runway. Nothing to decide today, but I'd like us to talk about the plan for month 20 onward at our next call."

Frequently asked questions

Sources

1. CMS: 2026 Medicare Parts A and B Premiums and Deductibles (accessed Sept 2026)
2. CareScout: Cost of Care Survey 2025 (accessed Sept 2026)
3. Virginia Department of Social Services: Assisted Living Facility Disclosure Statement (accessed Sept 2026)
4. CFPB: Managing Someone Else's Money (accessed Sept 2026)