Private Pay

What it is

Private pay means funding care directly from savings, investment accounts, retirement funds, or home equity — no insurance product, no government program. It's the pillar every family eventually touches in some form, even those using other pillars alongside it. The real work in this pillar isn't whether to fund care privately — it's sequencing: which assets to spend first, which to protect, and which trigger a tax consequence you didn't anticipate.

Illustrative 2026-era cost ranges

These figures are illustrative national averages, not exact figures for any specific facility or region — costs vary significantly by state and even by county. Use them to frame a conversation, not to build a budget. For a facility- and region-specific cost lookup, see the CareScout Cost of Care Survey or LTC News' long-term care cost calculator.

• In-home care (non-medical aide): roughly $30–$40 per hour in most markets; full-time care can run several thousand dollars per month
• Assisted living: commonly $4,500–$6,500 per month nationally, with significant regional variation
• Memory care: typically $6,000–$9,000 per month, reflecting higher staffing ratios
• Skilled nursing / nursing home: often $8,000–$11,000+ per month for a private room

Sequencing considerations

• Taxable accounts first, often: spending down taxable brokerage or savings accounts before tapping tax-deferred retirement accounts can reduce the total tax bill over the care period.
• Required Minimum Distributions: retirement accounts still require RMDs regardless of care status — factor that income into any Medicaid or VA planning happening alongside private pay.
• Home equity: a reverse mortgage, home equity line, or sale can convert an illiquid asset into a funding source — but affects Medicaid and VA eligibility differently depending on how it's used, which is why this often intersects with Pillars 5, 6, and 7.
• Long-term care hybrid or annuity products already owned: should be activated and coordinated with private-pay spending, not run separately.

Who it fits

Every family, in some measure. For those with sufficient assets and a strong preference for full control over care choices without navigating insurance claims or government program rules, it may be the primary and preferred pillar rather than a fallback. The Administration for Community Living's overview of who pays for long-term care puts private pay in context alongside the other funding pillars.