Weighing the cost vs the value of a retirement community

For many older adults, moving into a senior living community may sound like a good idea – except, they’re worried about the cost.

For those who are considering a move into a continuing care retirement community (CCRC), questions about running out of money in the long term can be enough to keep them away. CCRCs provide a continuum of care - many residents move into independent living but know they have assisted living and even health care services available to them if and when they need them.  

There are certain costs that come with moving into a continuing care retirement community. Most have an entrance fee as well as a monthly service fee. The entrance fee may be in the five or six figures and the monthly fee on top of that could seem daunting. It all leads people to believe that staying their own home will be less expensive.

Learn more about your financial options at Emporia Presbyterian Manor

But is that really the case? Here are a few factors to consider when weighing the value versus the cost of a retirement community.

Expenses of aging at home

Even without a monthly mortgage payment, the costs of staying in your own home often keep increasing.

Regular maintenance alone is expensive. Services like yard work, pest control, even trash and recycling can add up. Then, you have to factor in big one-time repairs like replacing the roof or installing a new HVAC system.

Additionally, you have to consider whether your home will need any modifications as you age in order to keep you safe. You may need to install grab bars, change the tub to a walk-in shower, or add in a wheelchair ramp. On average, people spend $10,000 on home modifications to meet their needs as they age.

Another expense of keeping your own home – rising property taxes and insurance rates. In some areas of the country, both of those rates are skyrocketing because of higher housing prices and more expensive building costs.

Finally, aging in your own home often requires some in-home assistance – usually for a few hours a day to perform tasks like cooking, cleaning, and helping with bathing. Outside of that cost, family members often become unpaid caregivers which often means higher stress, and even financial support.

Value of living in a community

All those unpredictable expenses may no longer be a concern after a move to a continuing care retirement community.

Because those home expenses drop, some residents find that the monthly cost of living in a CCRC has less of an impact than they anticipated.

• Property insurance costs likely will decrease dramatically, going from a costly homeowner’s policy to a much more economical renter’s policy.

• Your monthly bill at the community includes things like home maintenance and lawn care. It also includes security, fitness facilities and programs, meals, and much more.

• Predictable monthly costs allow residents to know how much to budget every month – without the out-of-pocket costs for sudden home repairs or changing property taxes.

• Transportation costs may drop significantly as some residents decide they no longer need a vehicle of their own. Many communities have a shuttle and offer scheduled transportation to medical appointments or trips to grocery stores.

• Continuing care retirement communities also offer many events -- free movies and concerts, holiday celebrations and many other activities…all of which can bring down your monthly entertainment expenses.

• A move to a continuing care retirement community may also bring some tax benefits. Depending on your contract with the community, you may be able to deduct a portion of the entrance and monthly fees on your taxes. Consult with a tax advisor familiar with senior living.

Click here for a cost comparison worksheet

A price worth paying

So, while the monthly expense of a CCRC may seem a bit pricey at a glance, and you should consider what you get for the money.

Of course, monthly costs can vary based on your contract type, your personal expenses, and the various offerings at your particular retirement community. It’s also important to keep in mind that some expenses do not go away regardless of where you live, such as doctor visits, Medicare, certain other insurance premiums, etc.

But when comparing the cost of a continuing care retirement community versus the value for the money, many people conclude that the benefits are worth it. Of course, the biggest benefit may be the peace of mind that comes from living in a CCRC, and it’s hard to place a value on that.

At Emporia Presbyterian Manor, we can help you compare costs and guide you through the process of deciding whether community living is right for you. Call Andraya Taber at 620-343-2613 or email her  at ataber@pmma.org or contact us online.

‍