The cost of in-home care usually ranges between $16 and $30 an hour, depending on the location (urban areas tend to be more expensive), the type of care needed (simple help around the house is less expensive than skilled help with bathing, toileting, and safely getting in and out of bed, for example). Most families wind up having to tap into their own finances to pay for in-home care. Before you wipe out your own savings, be sure to explore these two options:

Long-term care insurance

If your loved one has a long-term care (LTC) insurance policy, it may cover some costs of in-home care. Some LTC policies only pay home care benefits to a licensed home care agency or other licensed provider; others pay a set daily amount to the insured person who qualifies for the benefits (which means your loved one can spend that money on any caregiver he or she chooses, including family members).

Read through the LTC policy itself to see if there's coverage for in-home care and what the payment terms are: when someone qualifies, for how much, and how the benefits are to be paid.

Life insurance for cash

If your loved one has a life insurance policy, you may want to look into whether it could provide money now to help pay for care instead of going to family members later. Cashing in a life insurance policy can sometimes provide a substantial amount of money to pay for in-home care. Certain life insurance policies can be cashed in with the insurance company itself for 50 to 75 percent of the policy's face value, though some policies permit these "accelerated benefits" or "living benefits," as they're called, only if the policyholder is terminally ill.

If these accelerated insurance benefits aren't available, you can investigate whether a "life settlement" (also called a "senior settlement") may be possible. This involves selling the policy to a life settlement company (different from the insurance company that issued the policy) for a lump sum. The exact amount of the payment -- 50 to 75 percent of the policy's face value -- depends on the policy benefit amounts, the policy's monthly premiums, and your loved one's age and health. After buying the policy, the settlement company keeps paying the premiums until your loved one dies; then the life insurance benefits are paid to the settlement company rather than to a family member or whoever was the policy's original beneficiaries.

Reverse mortgage

If your loved one who needs in-home care and his or her spouse live in a home that they own, a reverse mortgage may be a way for them to convert their home equity into cash, while continuing to live in the home. A reverse mortgage, secured by the home, can be paid as a lump sum, a set monthly amount, a line of credit, or some combination. Your loved ones don't have to repay the reverse mortgage until both owners are no longer in the home, because they've sold it, have both left it permanently (for example, by living in a nursing home), or have died.

A reverse mortgage is a big financial step -- it means that much if not all of the value of the house will no longer be passed on to family members -- but it may be a valuable strategy that allows your loved ones to stay at home and pay for care for many years.

Family contributions

It's a common scenario: Your loved one lives in one sibling's house, or you (or another sibling) are the only one who lives near your loved one, or you (or another sibling) are the only one whose other family and work obligations allow the time to provide regular caregiving.

Whatever the reason for this difference in caregiving responsibilities, the ones who don't provide hands-on caregiving may be able to regularly contribute to a family fund that helps pay for in-home care. This pay would supplement, and be a fair balance for, the nonpaid care that you (or another sibling) provide. The amount each noncaregiver sibling contributes can be based on the number of hours of direct caregiving you (or another sibling) provide without pay.

Veterans benefits

Veterans and the surviving spouses of veterans may be eligible for some in-home care assistance from the Department of Veterans Affairs (VA) -- either through health benefits offered to veterans or in the form of a monthly cash benefit. If your loved one is housebound, these benefits may be even higher.