Assisted living costs a national median of roughly $5,400 to $6,200 a month in 2026, or about $65,000 to $74,000 a year, according to the most recent cost of care survey data. That's the national figure, actual cost in your area could be meaningfully higher or lower, Mississippi and Alabama sit closer to $4,500 a month while many coastal metro areas run well above the national median. The number that actually matters for planning isn't this year's cost, though, it's what that cost will be in year five, year ten, and year fifteen, and the age at which savings run out under those assumptions.
Why assisted living costs rise faster than general inflation
Senior care costs have consistently outpaced the general Consumer Price Index for years, driven by three factors that don't show signs of slowing: rising caregiver wages in an industry that already struggles to staff, increasing acuity of care as residents move in older and with more complex needs, and regulatory and insurance costs that get passed straight through to residents. Most financial projections use a cost-growth rate somewhere between 4% and 6% annually, noticeably higher than typical retirement-planning inflation assumptions, and that gap compounds fast over a 10-15 year horizon.
The number that actually matters: shortfall age
Most families ask "how much does assisted living cost" when the question that actually determines the plan is different: at what age do savings run out, given the specific person's current savings, monthly income, monthly costs, and a realistic cost-growth rate? Two families with identical savings balances today can have shortfall ages a decade apart depending on their income, their local cost level, and how aggressively costs are rising in their specific market and care type.
Working this out requires running the numbers forward year by year, not just comparing this year's cost to this year's savings. A simple example: $300,000 in savings against $6,000 in monthly costs looks like roughly four years of runway at today's numbers. Run the same $6,000 forward at 5% annual growth for ten years and it's over $9,700 a month, the runway is significantly shorter than the simple division suggested.
What actually goes into the projection
A useful projection needs a handful of real inputs, not just a single cost figure:
- Current age and care type, since costs and typical timelines differ meaningfully between independent living, assisted living, and memory care
- Current savings and investments, plus any income sources like Social Security or a pension that offset monthly costs
- Monthly budget as it stands today, not an estimate
- Annual cost increase, using a realistic rate for the specific care type and region rather than general inflation
- Rate of return on remaining invested savings, since money that hasn't been spent yet is still working
Run through those inputs and the output is a single, concrete number: the age the money runs out under the assumptions used, plus how that age shifts if a parent moves from assisted living into memory care, if a spouse's income changes, or if the market underperforms for a few years.
Frequently asked questions
How much does assisted living cost per month on average?
Roughly $5,400 to $6,200 a month nationally as of 2026, though local cost can vary by thousands of dollars a month depending on state and metro area.
Does Medicare cover assisted living?
No. Medicare generally does not cover the room-and-board cost of assisted living. Medicaid can cover some costs in certain states through specific waiver programs, but eligibility and coverage vary significantly by state.
How fast do assisted living costs typically rise?
Most planning models use 4-6% annual growth, higher than general inflation, driven by rising caregiver wages and increasing care needs over time.
What's the difference between assisted living and memory care cost?
Memory care typically costs 20-30% more per month than standard assisted living, reflecting the higher staffing ratios memory care requires.
Working out your own shortfall age, and how it shifts under different scenarios, is what the Senior Housing Financial Escalation & Budget Planner is built to do: a 513-formula model across four tabs, plus a guide walking through how to use it.