Why 'Rich' People Don’t Put Their Parents In Nursing Homes — And What They Do Instead

There are better options for your parents than the nursing home.

Woman in old age living out her retirement at her own, newly purchased home Edu Carvalho / Canva

Your Rich BFF, also known as Vivian Tu, is a former Wall Street trader who has switched to a life of creating financial content for social media in order to help others make and save money.

In her most recent video, uploaded on October 8, 2023, Tu explains what people should do instead of putting their parents into a retirement home that will cost them thousands of dollars every month. She claims it’s a strategy that rich people use.


She says rich people don’t put their parents in nursing homes — they buy homes instead.

Tu starts off by providing people with a scenario. She asks viewers to consider that their parents may have set aside $5,000 a month for living arrangements during their retirement. Assisted living communities average out to around $4,000 to $5,000 a month while nursing homes average out to $7,000 to $8,000 a month.

Accepting the offer of a more expensive option means that all of your parents’ funds would be gone and they may require some additional financial assistance. Instead of giving all of this money to “some private equity fund that owns the nearby retirement home,” people can take advantage of a program called the Family Opportunity Mortgage.




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The Family Opportunity Mortgage is a loan offer that some private lenders offer and provides massive benefits over regular home loans. These are typically used when parents want to provide housing for their disabled adult children, or when children want to provide housing for their parents who can no longer qualify for mortgages because they are retired or have a low income.

Thanks to these special loan opportunities, borrowers can enjoy advantages such as lower down payment requirements, lower interest rates, lower property taxes, and tax-deductible mortgage and property tax interest.


By opting to purchase a home using a FOM, Tu claims you’re also helping your parents live in the way they want to in their old age. According to a survey from the AARP, more than three-quarters of Americans aged 50 and older would like to keep living in their current homes.

“By leveraging the Family Opportunity Mortgage, not only can you honor your parents' wishes, but you can keep the family money in the family,” she explains at the end of her video.

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Retirement is expensive, so it’s important to save where you can.

Due to the increases in the cost of living around the country, retirement has also become more expensive.


The CDC and the Social Security Administration have both reported an increase in life expectancy in the United States, according to Vision Retirement. A longer life means that people will be in retirement for longer, which means they’ll need more money.

The recent inflation increases have proven to be a cause for concern among retirees, according to a New York Times article that saw several seniors interviewed about their concerns. “I’ve probably eliminated 90% of buying any meat because it’s so expensive,” said 89-year-old Marilynn Miller from Crest Hill, Illinois.

Having equity in a home and lower monthly costs compared to nursing homes or retirement community costs seems like a no-brainer, especially if you're budgeting already.


If health isn't a concern, it makes sense to give retired parents the independent golden years they deserve — both financially and emotionally.

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Isaac Serna-Diez is an Assistant Editor for YourTango who focuses on entertainment and news, social justice, and politics.