The $129,000 Expense That Social Security Simply Can't Cover (And Medicare Won't Either)

A year in a private nursing-home room can cost about $129,000, according to a recent CareScout survey. The average Social Security retirement benefit adds up to only about $25,000 a year, leaving a gap that's far too large for most retirees to cover from their monthly check alone.

Medicare usually won't pick up the cost of long-term custodial care either. So even if you've worked hard to save money in retirement, long-term care can become one of the biggest expenses your plan has to account for.

Here's what Social Security and Medicare actually cover and where you may need another way to pay.

What long-term care actually costs

At the 2025 national median, a private nursing-home room costs about $129,575 a year. Assisted living runs about $74,400, while 44 hours a week of non-medical in-home caregiving can come to roughly $80,000.

With the average Social Security retirement benefit providing about $25,000 a year, even assisted living can cost nearly three times that amount. A private nursing-home room can cost more than five times as much.

Those are median prices, too, which means plenty of retirees will face bills that are even higher depending on where they live and how much care they need.

What Medicare will and won't cover for long-term care

Medicare can help with short-term skilled nursing care after a qualifying hospital stay, but it generally won't pay for the ongoing help many people need in a nursing home or at home.

Help with bathing, dressing, eating, or getting around is usually considered custodial care. Medicare doesn't cover that kind of long-term support, even when you need it every day.

You may qualify for up to 100 days in a skilled nursing facility for recovery and rehabilitation. Once that short-term medical care ends, the cost of ongoing personal care usually becomes your responsibility.

How Medicaid rules can leave middle-income retirees squeezed

Medicaid can help pay for long-term nursing-home care, but qualifying often means meeting tight financial limits. The rules vary by state, and married couples may get additional protections for the spouse who continues living at home.

In many states, a single applicant can have only about $2,000 in countable assets and roughly $2,982 in monthly income in 2026. Your home, personal belongings, and some other property may not count toward those limits.

Earning more than the income limit doesn't necessarily mean Medicaid is out of reach. Depending on where you live, you may be able to use a qualified income trust or qualify after certain medical expenses are taken into account.

You can still end up with far too little money to afford a six-figure nursing-home bill while having too much to qualify for Medicaid right away. You may have to use some of your own resources for care first, which is why it helps to check your state's rules before you actually need long-term care.

Why planning for care can help while you're still healthy

Research consistently shows that roughly 70% of people who reach age 65 will need some form of long-term care during their remaining years. The average duration of need is about three years, though some people need care for much longer.

At today's prices, three years in a private nursing-home room could approach $390,000. Assisted living for the same period could cost about $223,000, while extensive home-aide care could run roughly $240,000.

Those costs can build really quickly even when care lasts only a few years. Planning for the possibility ahead of time can give you more options for how and where you receive care if you eventually need it.

When long-term care insurance may be worth considering

Long-term care insurance can help pay for costs Medicare usually doesn't cover, including nursing-home care and help at home.

What you pay depends heavily on your age and health when you apply. A 2023 industry survey found that a 60-year-old man in select health could pay about $2,585 a year for a policy with an initial $165,000 benefit pool and 3% annual benefit growth. A 60-year-old woman could pay about $4,450 for comparable coverage.

Buying in your 50s or early 60s can make coverage easier to qualify for and less expensive than waiting until later. By your 70s, premiums may be much higher, and health problems can make approval harder.

That said, you may pay premiums for years and never need long-term care. If you do need it, though, a policy can help keep a large care bill from eating through your savings as quickly.

Other ways to help cover long-term care costs later

If long-term care insurance feels too expensive or simply doesn't fit your plan, you can set aside part of your retirement savings specifically for future care. Having money reserved for that purpose can help keep a large nursing-home or home-care bill from eating into everything else you've saved.

Some people also look at hybrid life insurance policies with long-term care benefits. These policies can help pay for care if you need it and may provide a death benefit if you don't, although premiums are often higher than standalone long-term care coverage.

Talking with your family ahead of time can also make future decisions easier. Discuss who could help coordinate care and how much the household could realistically afford, so you're not trying to figure everything out during a crisis.

Bottom line

Long-term care can be expensive, but planning for it early gives you more ways to handle the cost if you ever need help later on.

You don't need to know exactly what kind of care you may need someday. Setting aside money or exploring insurance while you have time can help you make the right moves now and feel better prepared if long-term care eventually becomes part of your retirement.

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