Care costs are the biggest wild card in aging, and the most often underbudgeted. Whether it’s home support after surgery, help with daily activities or a transition to long-term care, understanding the cost spectrum and provincial variability is essential to building a resilient plan.
Care needs should be looked upon as a progression, not a single event.
The first phase is referred to as aging in place. Your client needs occasional help with housekeeping, meal preparation and transportation.
That’s followed by additional home-care services: personal care, nursing support and therapy. The number of hours required can scale up over time.
Phase three is an assisted living or retirement home situation. This comes with services such as meals, housekeeping and social activities.
Next is long-term care: supervised care for complex needs, 24 hours a day, seven days a week. Provincial ministries provide some funding.
Finally, palliative care or end-of-life services offer comfort-focused care, sometimes at home with specialized services.
Each level presents different costs, time requirements, complexity and intensity — all of which often increase gradually. Plans should include care progression assumptions. For example, a client may need four to eight hours a week of home care early on. A decade later, they could be looking at 20 to 40 hours each week depending on their mobility, cognition and caregiver availability.
There are four primary cost drivers:
- Province and locality: Public coverage and fees vary by province. And availability differs, depending on whether your client lives in an urban or rural area.
- Intensity and complexity: Dementia care, high medical needs or mobility limitations drive costs higher.
- Availability of family caregivers: Family support can reduce paid hours. But it carries real emotional and financial costs, including burnout and lost wages.
- Inflation: Health care and service costs often rise higher than headline inflation. Stress test your plans.
A practical estimating framework
Create monthly cost projections by care level:
- Aging in place with light support: Budget for housekeeping, meal services and transportation — $25–$50 per hour. Budget for ramps, chairlifts, stairlifts, etc. — $500–$35,000, depending on equipment.
- Private home care: Estimate a range based on hours per week required. Add nursing and therapy premiums as required — $25–$200 per hour.
- Assisted living/retirement homes: Monthly fees vary by services and suite size. Include deposits and plan ahead if there are wait lists in your client’s area — $4,500–$12,000 per month depending on amenities, care options and location.
- Long-term care: Consider fees for accommodation (publicly subsidized in many provinces) plus out-of-pocket costs for personal items, medications and special services. Costs vary by province — estimate $1,300–$4,000 per month (no charge in Nunavut). Wait lists are common. In Ontario, it’s about 48,000 people long.
Don’t rely on averages. Plan using ranges and revisit your estimates annually. Include one-time costs (e.g., home modifications, technology, ramps, bathroom safety) and ongoing subscriptions (e.g., medical alert, remote monitoring and meal services).
Layer funding sources
Prepare your client to supplement publicly funded programs with additional sources.
Insurance has a role to play too, obviously: long-term care if the client qualifies, critical illness, permanent life with riders and disability coverage for pre-retirees.
There are federal and provincial tax credits for medical expenses or disability, as well as caregiver-related supports. Employer-sponsored benefit plans can provide further assistance.
Family arrangements are often part of the mix too — encourage clients to develop plans with siblings and other family members if possible.
Clients should expect to pay out of pocket for some services. Many will have to draw down on their savings and retirement income. It’s a good idea to build a care reserve in a liquid account or short-term fixed income ladder.
A dedicated care reserve separates unpredictable care costs from lifestyle spending. Three considerations:
- Liquidity first: Use high-interest savings accounts or short-term GICs and bonds to fund the next 12–24 months of potential care.
- Laddering: Stagger maturities to reduce reinvestment risk and ensure availability.
- Refills: Plan annual reserve top-ups based on plan review and inflation.
This approach protects the core retirement portfolio from large, sudden withdrawals and offers a measure of psychological comfort to families.
Stress test your client’s plan based on 3%–5% care inflation. Add shock years, in which they face elevated costs. And identify trigger points that might demand changes in the level of care required (e.g., a fall or caregiver burnout).
Documentation is key too. Build a care plan alongside financial and estate plans. Include preferred providers, service minimums, contacts and escalation steps. Align financial permissions (e.g., power of attorney), share read-only access and set alerts for anomalies to prevent financial exploitation.
Consider the cost of all this on the family — financial and otherwise. Hold a family meeting to define roles, boundaries and compensation/stipends if appropriate. Budget for respite care. Track expenses transparently to avoid resentment and maintain trust. And allow space for a potential caregiver to bow out.
Care costs don’t come in the form of a single number. They come in ranges that evolve over time. The best defense is a proactive plan. Estimate using bands; build a dedicated care reserve; coordinate public and private supports; address family dynamics explicitly; and review annually. With the right structure, Canadians can age in place with dignity and pivot confidently when needs change.