Entrance Fee for Retirement Community

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Prudence
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Entrance Fee for Retirement Community

Post by Prudence »

DW and I are considering selling our house and moving into an independent living retirement community. The community requires an entrance fee and a monthly fee. There are three options for the entrance fee: declining balance (entrance fee declines one percent per month for 60 months and then the refund is zero); 50% refundable (50% of entrance fee is refunded whenever we decide to move out); 90% refundable (90% of fee is refundable whenever we decide to move out). It seems that the declining balance would appeal to a couple who can't afford the other two options. The 90% refundable, if affordable, seems most attractive, except that the value of the refund could be significantly impacted by inflation. We assume that we would keep the unit for at least 15 years. Most of these communities have similar structures. Is there a rule of thumb about which of these choices is most favorable? Has anyone had personal experience with this?
skepticalobserver
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Re: Entrance Fee for Retirement Community

Post by skepticalobserver »

We’ve been looking into CCRCs. An issue with redeeming the entrance fee is that based on the contracts I’ve reviewed there must be a ready buyer; that is, the CCRC is not going to take off it your hands when you, or your estate, wants to “sell.”

Is this a type A, B or C contact community? The type A fees include independent and assisted living (and possibly “memory care”) as well as skilled nursing. I think underwriting for type A candidates is comparable to that of a LTC policy.
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ResearchMed
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Re: Entrance Fee for Retirement Community

Post by ResearchMed »

Prudence wrote: Sun Oct 20, 2019 8:43 am DW and I are considering selling our house and moving into an independent living retirement community. The community requires an entrance fee and a monthly fee. There are three options for the entrance fee: declining balance (entrance fee declines one percent per month for 60 months and then the refund is zero); 50% refundable (50% of entrance fee is refunded whenever we decide to move out); 90% refundable (90% of fee is refundable whenever we decide to move out). It seems that the declining balance would appeal to a couple who can't afford the other two options. The 90% refundable, if affordable, seems most attractive, except that the value of the refund could be significantly impacted by inflation. We assume that we would keep the unit for at least 15 years. Most of these communities have similar structures. Is there a rule of thumb about which of these choices is most favorable? Has anyone had personal experience with this?
Are there different other costs/benefits associated with each of these refund choices?

The facility we are considering (has Independent, Assisted, Skilled Nursing, Memory) has a choice of "percentage back" when resident leaves (for whatever reason), but the higher the refund, the larger the initial deposit.
So someone with significant legacy plans might choose the higher deposit/larger refund (and be without the money during their own remaining life), and someone without such plans might prefer the lower deposit/lower refund (and thus have the ability to "spend more" during their own remaining life).

The entry fee itself, and monthly fee, depends upon the size of the unit selected, and which 'wing' is chosen with the higher care facilities having a somewhat higher monthly fee.

There is no need to have someone else "ready" to take one's unit to get the refund. Indeed, at this facility, there can be a *very* long wait to get in, or to change units. Current residents get "first dibs" at newly available units, with those needing "more care" getting bumped to the top of the queue at the next care level section.This makes it incredibly difficult for someone to first enter at, say, the skilled nursing section. This facility also keeps residents in skilled nursing [on Medicaid] if they run out of money, which means those rooms might be occupied longer.

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JoeRetire
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Re: Entrance Fee for Retirement Community

Post by JoeRetire »

Prudence wrote: Sun Oct 20, 2019 8:43 amThe 90% refundable, if affordable, seems most attractive, except that the value of the refund could be significantly impacted by inflation. We assume that we would keep the unit for at least 15 years.
Inflation could significantly reduce the purchasing power of the 90%, particularly if given enough years. If you think you will only live for 15 more years, that's one thing. If you think you'll live a lot longer, that's a different thing.

I would be tempted to care a lot less about the "refundable" amount if this was intended to be my final residence.

A good fee-only fiduciary financial planner could help you discuss your assumptions about longevity, inflation, life style, legacy goals, and the math involved, and help you come to a financially sound decision.
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skepticalobserver
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Re: Entrance Fee for Retirement Community

Post by skepticalobserver »

This a December, 2018 Kiplinger article which addresses in part the issue of refundable CCRC entrance fees, https://www.kiplinger.com/article/retir ... irees.html

Of note:

“Many CCRCs will refund entrance fees only when the unit is reoccupied—and that’s a potential problem for former residents or their heirs. If the economy is sluggish, it may take quite a while to find a new occupant, and if the community has other units available that will bring in higher fees, “the CCRC is not highly motivated to reoccupy a unit that has a refundable fee attached to it,” says Katherine Pearson, law professor at Penn State’s Dickinson Law. In some cases, she says, it can take years to receive a refund.”


Unquestionably, some CCRCs are more desirable than others and in such cases units (licenses?) will be “sold” reasonably fast. Given, however, the high cost of entrance/monthly fees and, particularly for type A contact facilities, the health underwriting of such applicants (the healthier the better) as well as applicant financial underwriting (robust financial resources desired), the odds of finding qualified, ready and willing “buyers” may not be favorable.
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Re: Entrance Fee for Retirement Community

Post by HomeStretch »

Good advice, above.

A factor to consider in the refundable/non-refundable fee scenarios is the credit-worthiness of the CCRC holding the money and whether your refundable deposit is held separately in a manner where it is not accessible to creditors or for general working capital purposes
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Re: Entrance Fee for Retirement Community

Post by stan1 »

I'd go into this with the idea that it is a luxury purchase not an investment. You are buying a lifestyle, convenience, and peace of mind that come at a high cost. Value is intangible. CCRCs are not an option for "most people".

To mitigate I'd make sure you really want to do this. Make sure you understand the demographics of the community you are looking at. If many people are 10 years older than you are you will see many of your new friends pass away over the coming years while you are still healthy. Some people prefer a more diverse environment (that's using diverse in the the broadest sense possible -- age, race, gender, socioeconomic background, etc). You will find a lot of people with good pensions in these communities. Pensions help pay the monthly costs.

What is the alternative? There are plenty of pay as you go options that you can use when you need them.
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Re: Entrance Fee for Retirement Community

Post by fourwheelcycle »

Before you select a 50% or 90% refundable entrance fee do some math and figure out the implied interest rate the retirement community is using to calculate the premium they are charging you for the refundable option. Use your actuarial life expectancy on the day you are going to pay the entrance fee as the time period. If you set up a simple spreadsheet and type in alternative interest rates you may find you could do better by investing the premium yourself than by giving it to the retirement community to return to your heirs after the same time period.

I am not saying that paying the premium for a 50% or 90% refund is always a bad idea; I'm just suggesting that you do the math and consider alternative investment opportunities for the same amount of money.
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Re: Entrance Fee for Retirement Community

Post by drawpoker »

Prudence wrote: Sun Oct 20, 2019 8:43 am ......It seems that the declining balance would appeal to a couple who can't afford the other two options.....
Possibly for some. But the real attraction to that option is that if you aren't happy for some reason and want out within a few months, you can do so easily and recoup most of your money @ 1% per mo.

Interesting bit of obfuscation in your post. You refer more than once using phrase "when we move out". Rather than just say "when we die". Maybe you meant moving out to the cemetery? :wink:

Another warning about the so-called 90% refundable places. In the one my parents moved into back in the early '90's there was a catch: The unit, whether an apt or cottage, had to be re-sold under the very same terms. IOW, if a couple bought a 2BR 2 BA unit, then a single came along who wanted it and bought it, no soap, no refund coming. That was not considered the same transaction.

This did not happen to my parents, but it did in more than one case during the time they lived there we were aware of. And, yes, you can be sure the heirs of those deceased couples affected were plenty steamed about it. Apparently it was buried in the fine print.

Edit: The thread has focused on CCRC arrangements but now I just noticed you said "indep. living community". Which is it? I assumed you were moving into an indep. living unit within a CCRC, if that is incorrect, just disregard the other part.
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Re: Entrance Fee for Retirement Community

Post by delamer »

I wonder how many couples or individuals enter a CCRC requiring a deposit (of any type) and end up moving out of the community before they die?

My parents lived in one and I have an anecdotal story of someone leaving.

But my guess would be is that it is uncommon, due to the financial commitment, even with a plan that allows for a large refund.

I agree with the earlier comment regarding the OP’s idea of keeping “the unit for at least 15 years.” I wouldn’t commit to such a community unless I expected it to be permanent.
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Prudence
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Re: Entrance Fee for Retirement Community

Post by Prudence »

We considered an CRCC and an independent living community, and, we preferred the latter. If we plan to stay until we die in the latter, we would need to plan on having assistance and then nursing care in the unit (in home care) at some point. I was thinking that, at some point in the future, we would probably need to relocate from the independent living community that we like to a place like CRCC that has assisted living and nursing care. Maybe this (two moves) is not a wise plan.
Last edited by Prudence on Sun Oct 20, 2019 3:24 pm, edited 1 time in total.
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Re: Entrance Fee for Retirement Community

Post by Golf maniac »

It really depends on the amount of each option and the return you could get if you invested the money. I really wouldn’t want to deal with the credit risk and re-occupy problems of the refundable options so if everything was equal I would do the 60 month payment with no refund. Then if I planned to be there for the rest of my life it is no hassle for my heirs. Of course everything may not be equal.
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ResearchMed
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Re: Entrance Fee for Retirement Community

Post by ResearchMed »

Prudence wrote: Sun Oct 20, 2019 2:43 pm We considered an CRCC and an independent living community, and, we preferred the latter. If we plan to stay until we die in the latter, we would need to plan on having assistance and then nursing care in the unit (in home care) at some point. I was thinking that, at some point in the future, we would probably need to relocate from the independent living community that we like to a place like CRCC that has assisted living and nursing care. Maybe this (two moves) is not a wise plan.
We had been thinking about all of this, and it became front and center when we finally convince very elderly MIL to move 'cross country to an ALF (Assisted Living Facility) near us. Convincing her was quite a struggle, but that's another story that I've described elsewhere on BH.

She is now in a very nice facility that runs the full range of services as mentioned above.
So we have had a very good opportunity to observe it "from the inside", with her as a resident, and many meals eaten there with her, and even more visits at various times.

But one thing only became obvious after she had been there a while, and it relates to your comment...
All of the different levels are still in one main campus, and one can walk among them without even going outside in bad weather, although they have lovely grounds. (There are also some underground halls at the parking level, so that residents/patients can be wheeled/rolled if needed between the different areas or for medical appointments that can be handled by the staff, etc.)
The Independent Living section includes a bunch of different sizes of condo-like apartments in the main complex, along with the only "non-attached" sections, which are free-standing cottages/villas of varying sizes.

But an additional, and significant for many, advantage is that as residents need to "move along" as care needs change, they can very easily continue to see their friends from the former unit(s). That could include sharing concerts/lectures/movies, or continuing to play bridge with the same friends, or just "visiting". For those who can no longer easily get around, it's quite easy for the friends to come over to visit.
So there is some nice continuity of relationships, which I think for most people would be quite important at that stage of life - although continuity of friendships is always nice and even important at any stage of life, for most.

That wouldn't be as convenient, and perhaps not possible at all, if one moved to a totally different community, even if not a long distance away.

RM
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drawpoker
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Re: Entrance Fee for Retirement Community

Post by drawpoker »

Prudence wrote: Sun Oct 20, 2019 2:43 pm .....was thinking that, at some point in the future, we would probably need to relocate from the independent living community that we like to a place like CRCC that has assisted living and nursing care. Maybe this (two moves) is not a wise plan.
Be careful there. Many of the better CRCC's only allow admissions to people who are in good health and going into an apt or cottage. They do not allow an admission directly to the assisted living section or the SNF wing. Each place has diff. rules on this, at the CCRC my parents were in, they made exceptions for certain members of the flock. Being affiliated with a major religion, they would let a minister's widow, or a big donor over the years, move directly into assisted living occasionally.

That is why you have to pass two exams to be approved - the financial test and the health examination.
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ResearchMed
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Re: Entrance Fee for Retirement Community

Post by ResearchMed »

drawpoker wrote: Sun Oct 20, 2019 4:01 pm
Prudence wrote: Sun Oct 20, 2019 2:43 pm .....was thinking that, at some point in the future, we would probably need to relocate from the independent living community that we like to a place like CRCC that has assisted living and nursing care. Maybe this (two moves) is not a wise plan.
Be careful there. Many of the better CRCC's only allow admissions to people who are in good health and going into an apt or cottage. They do not allow an admission directly to the assisted living section or the SNF wing. Each place has diff. rules on this, at the CCRC my parents were in, they made exceptions for certain members of the flock. Being affiliated with a major religion, they would let a minister's widow, or a big donor over the years, move directly into assisted living occasionally.

That is why you have to pass two exams to be approved - the financial test and the health examination.
I had forgotten about this, and it can be VERY important.
It's probably a reason we'll move into the one we are planning on, sooner rather than later.

Although this place will "keep" residents who run out of money (for the monthly fees and assorted extra services) and accept Medicaid, they certainly will not accept a newcomer that way.
They have some financial vetting that takes into account ages/life expectancy/level of care needed/expected (and the costs of each level) along with the applicant's financial resources, etc.
They will also let a couple share the accommodation level, if preferred, of the person needing the most care. This means that, for example, a couple wouldn't need to keep separate units at, say, independent & assisted, or assisted & skilled nursing.

We have a colleague whose husband suddenly needed more care than she could give, especially as she was still a full time/active professor. So they sold their home, and she moved with him into one of the larger assisted living units. She is still there, but he is now, unfortunately, in the memory care unit. But she can spend as much time with him as she wishes, and go back and forth in a matter of minutes, when she is home.
That could have been so much more complicated, and unpleasant, if a move to a totally different facility had been needed but both of them did not want to be - or could not be - "there".

RM
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Re: Entrance Fee for Retirement Community

Post by flyingaway »

How much is the entrance fee and how much is the monthly fee that you are talking about (approximately)?
delamer
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Re: Entrance Fee for Retirement Community

Post by delamer »

Prudence wrote: Sun Oct 20, 2019 2:43 pm We considered an CRCC and an independent living community, and, we preferred the latter. If we plan to stay until we die in the latter, we would need to plan on having assistance and then nursing care in the unit (in home care) at some point. I was thinking that, at some point in the future, we would probably need to relocate from the independent living community that we like to a place like CRCC that has assisted living and nursing care. Maybe this (two moves) is not a wise plan.
At the risk of sounding really ill-informed, what kind of “independent living community” requires deposits with refundable options?

I thought those types of arrangements were only relevant for CCRCs, with multiple levels of care available at the same facility.

Why not just buy a house in a 55+ community rather than deal with refundable deposits? Then, assuming your health allows, move to a CCRC when you are older.
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Re: Entrance Fee for Retirement Community

Post by straws46 »

HomeStretch wrote: Sun Oct 20, 2019 10:18 am Good advice, above.

A factor to consider in the refundable/non-refundable fee scenarios is the credit-worthiness of the CCRC holding the money and whether your refundable deposit is held separately in a manner where it is not accessible to creditors or for general working capital purposes
Good advice. Many of these use customer deposits to help fund construction and then have no way of paying back. One local development filed Chapter 11 and except for the lending bank consortium writing off the entire loan, all of those deposits from prospective owners would have been wiped out. The development may want to see your financials; you should want to see theirs too.
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Re: Entrance Fee for Retirement Community

Post by gasdoc »

For the purposes of the "audience," at what age does one generally consider a move to a CCRC? In The Villages, in Florida, many people move there in the late 40's and throughout their 50's. In less active 55+ communities that I am familiar with, it seems like people move there in their 70''s. Thanks!

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Re: Entrance Fee for Retirement Community

Post by delamer »

gasdoc wrote: Mon Oct 21, 2019 1:32 pm For the purposes of the "audience," at what age does one generally consider a move to a CCRC? In The Villages, in Florida, many people move there in the late 40's and throughout their 50's. In less active 55+ communities that I am familiar with, it seems like people move there in their 70''s. Thanks!

gasdoc
A CCRC is very different than an active adult community or a place like The Villages. A CCRC provides assisted living, memory care, and skilled nursing, as needed, within the same facility as independent housing units. Usually in the independent units you receive housekeeping, outside maintenance, transportation to doctor’s appointments, various activities, and some meals in addition to housing, as part of the contract. My parents’ place had a medical clinic staffed by a RN.

The risk with a CCRC is that your health needs to be good enough to qualify to live in the independent living housing. So if you wait until you develop a major health condition, it may be too late.

Based on my personal observation, I wouldn’t move to a CCRC until age 75 or so. Unless, of course, I had a progressive medical condition that made the CCRC a good option for the future and I was afraid that I couldn’t qualify if my condition deteriorated.
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Re: Entrance Fee for Retirement Community

Post by gasdoc »

delamer wrote: Mon Oct 21, 2019 1:46 pm
gasdoc wrote: Mon Oct 21, 2019 1:32 pm For the purposes of the "audience," at what age does one generally consider a move to a CCRC? In The Villages, in Florida, many people move there in the late 40's and throughout their 50's. In less active 55+ communities that I am familiar with, it seems like people move there in their 70''s. Thanks!

gasdoc
A CCRC is very different than an active adult community or a place like The Villages. A CCRC provides assisted living, memory care, and skilled nursing, as needed, within the same facility as independent housing units. Usually in the independent units you receive housekeeping, outside maintenance, transportation to doctor’s appointments, various activities, and some meals in addition to housing, as part of the contract. My parents’ place had a medical clinic staffed by a RN.

The risk with a CCRC is that your health needs to be good enough to qualify to live in the independent living housing. So if you wait until you develop a major health condition, it may be too late.

Based on my personal observation, I wouldn’t move to a CCRC until age 75 or so. Unless, of course, I had a progressive medical condition that made the CCRC a good option for the future and I was afraid that I couldn’t qualify if my condition deteriorated.
That's what I suspected. Thank you!

gasdoc
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Re: Entrance Fee for Retirement Community

Post by drawpoker »

delamer wrote: Mon Oct 21, 2019 1:46 pm Based on my personal observation, I wouldn’t move to a CCRC until age 75 or so......
Understand your thinking on that. But, purely from a financial perspective, to maximize the value of the six-figure entry fee, moving in as soon as one spouse is eligible (usually 62) would give you the biggest bang for your buck. Amortize that $300K, or $400K, whatever, over the longest number of years.

Of course, this wouldn't suit everyone but actually, in most places, if you move into a cottage instead of an apt, it isn't going to be a whole lot different from living in a regular neighborhood. Biggest difference is just no children to be seen or heard. Less traffic noise. Esp. in the bigger places where the cul-de-sacs with the cottages are a pretty good distance from the main apt bldg(s).

I do agree moving into an apt at an earlier age would probably be a mistake. You would definitely feel the warehousing effect in those type quarters. :( Constantly seeing people in wheelchairs, using walkers, canes, carrying their oxygen, etc. In the elevators, hallways, at the mailboxes. Very depressing.

Living in a cottage you avoid these dreary scenes every day. Unless you end up in a place like the one my parents chose. They had a rule that everyone, even if part of a married couple, had to sign up for at least one daily meal in the main dining room. This was so a maid would not discover a dead body, rotting away for days :shock: inside a cottage unit.

I always thought this was a supremely stupid and unnecessary rule. Why couldn't every single resident not signed up for a meal just agree to call the main desk, or the nurse's station, once a day at an agreed-upon time.

And yell out "It is 11 AM and I am Still Alive".
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Re: Entrance Fee for Retirement Community

Post by delamer »

drawpoker wrote: Mon Oct 21, 2019 3:08 pm
delamer wrote: Mon Oct 21, 2019 1:46 pm Based on my personal observation, I wouldn’t move to a CCRC until age 75 or so......
Understand your thinking on that. But, purely from a financial perspective, to maximize the value of the six-figure entry fee, moving in as soon as one spouse is eligible (usually 62) would give you the biggest bang for your buck. Amortize that $300K, or $400K, whatever, over the longest number of years.

Of course, this wouldn't suit everyone but actually, in most places, if you move into a cottage instead of an apt, it isn't going to be a whole lot different from living in a regular neighborhood. Biggest difference is just no children to be seen or heard. Less traffic noise. Esp. in the bigger places where the cul-de-sacs with the cottages are a pretty good distance from the main apt bldg(s).

I do agree moving into an apt at an earlier age would probably be a mistake. You would definitely feel the warehousing effect in those type quarters. :( Constantly seeing people in wheelchairs, using walkers, canes, carrying their oxygen, etc. In the elevators, hallways, at the mailboxes. Very depressing.

Living in a cottage you avoid these dreary scenes every day. Unless you end up in a place like the one my parents chose. They had a rule that everyone, even if part of a married couple, had to sign up for at least one daily meal in the main dining room. This was so a maid would not discover a dead body, rotting away for days :shock: inside a cottage unit.

I always thought this was a supremely stupid and unnecessary rule. Why couldn't every single resident not signed up for a meal just agree to call the main desk, or the nurse's station, once a day at an agreed-upon time.

And yell out "It is 11 AM and I am Still Alive".
Interesting thoughts regarding the cottage-style independent units.

The CCRCs that I have personal experience with don’t have cottages; independent living is apartment-style.

But I can see that a cottage would feel less institutional and offer more privacy.
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Re: Entrance Fee for Retirement Community

Post by drawpoker »

delamer wrote: Mon Oct 21, 2019 3:18 pm
The CCRCs that I have personal experience with don’t have cottages; independent living is apartment-style.
I would cross those off my list then. If you are in reasonably good health, and can afford the larger entry fee, you would be happier in a cottage.

If the CCRC offers nothing but apts. the most desirable ones in demand (and you will never get one because the waiting list will go on for decades :shock: ) will be the first floor ones. Because of the patio, screened porch, deck, or similar. Everything else on the upper floors will be able to offer only a (small) balcony. Maybe screened, maybe not.

If you are seriously looking at these places I would definitely expand my search.
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Re: Entrance Fee for Retirement Community

Post by delamer »

drawpoker wrote: Mon Oct 21, 2019 3:49 pm
delamer wrote: Mon Oct 21, 2019 3:18 pm
The CCRCs that I have personal experience with don’t have cottages; independent living is apartment-style.
I would cross those off my list then. If you are in reasonably good health, and can afford the larger entry fee, you would be happier in a cottage.

If the CCRC offers nothing but apts. the most desirable ones in demand (and you will never get one because the waiting list will go on for decades :shock: ) will be the first floor ones. Because of the patio, screened porch, deck, or similar. Everything else on the upper floors will be able to offer only a (small) balcony. Maybe screened, maybe not.

If you are seriously looking at these places I would definitely expand my search.
My personal experience is based on what my parents and other elders who I know moved into.

I am not anywhere close to looking for myself and spouse yet.

My parents were on a wait list and they could refuse a particular unit and still stay at the top of the list. I know that a lot of the good places have waiting lists, but decades?

And I would not assume that everyone wants the same units. If in apartment, I prefer the top floor to minimize noise.
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Re: Entrance Fee for Retirement Community

Post by TN_Boy »

delamer wrote: Mon Oct 21, 2019 3:18 pm
drawpoker wrote: Mon Oct 21, 2019 3:08 pm
delamer wrote: Mon Oct 21, 2019 1:46 pm Based on my personal observation, I wouldn’t move to a CCRC until age 75 or so......
Understand your thinking on that. But, purely from a financial perspective, to maximize the value of the six-figure entry fee, moving in as soon as one spouse is eligible (usually 62) would give you the biggest bang for your buck. Amortize that $300K, or $400K, whatever, over the longest number of years.

Of course, this wouldn't suit everyone but actually, in most places, if you move into a cottage instead of an apt, it isn't going to be a whole lot different from living in a regular neighborhood. Biggest difference is just no children to be seen or heard. Less traffic noise. Esp. in the bigger places where the cul-de-sacs with the cottages are a pretty good distance from the main apt bldg(s).

I do agree moving into an apt at an earlier age would probably be a mistake. You would definitely feel the warehousing effect in those type quarters. :( Constantly seeing people in wheelchairs, using walkers, canes, carrying their oxygen, etc. In the elevators, hallways, at the mailboxes. Very depressing.

Living in a cottage you avoid these dreary scenes every day. Unless you end up in a place like the one my parents chose. They had a rule that everyone, even if part of a married couple, had to sign up for at least one daily meal in the main dining room. This was so a maid would not discover a dead body, rotting away for days :shock: inside a cottage unit.

I always thought this was a supremely stupid and unnecessary rule. Why couldn't every single resident not signed up for a meal just agree to call the main desk, or the nurse's station, once a day at an agreed-upon time.

And yell out "It is 11 AM and I am Still Alive".
Interesting thoughts regarding the cottage-style independent units.

The CCRCs that I have personal experience with don’t have cottages; independent living is apartment-style.

But I can see that a cottage would feel less institutional and offer more privacy.
I've seen multiple CCRCs with cottage/small nice house options as well as apartments.

It's very nice to be able to stay in the same community, but cottage -> assisted living apartment is still a big step down when it happens.
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Re: Entrance Fee for Retirement Community

Post by TN_Boy »

delamer wrote: Mon Oct 21, 2019 10:51 am
Prudence wrote: Sun Oct 20, 2019 2:43 pm We considered an CRCC and an independent living community, and, we preferred the latter. If we plan to stay until we die in the latter, we would need to plan on having assistance and then nursing care in the unit (in home care) at some point. I was thinking that, at some point in the future, we would probably need to relocate from the independent living community that we like to a place like CRCC that has assisted living and nursing care. Maybe this (two moves) is not a wise plan.
At the risk of sounding really ill-informed, what kind of “independent living community” requires deposits with refundable options?

I thought those types of arrangements were only relevant for CCRCs, with multiple levels of care available at the same facility.

Why not just buy a house in a 55+ community rather than deal with refundable deposits? Then, assuming your health allows, move to a CCRC when you are older.
As others have said, you generally have to be *independent* when you move into a CCRC. How long do you wait?
TN_Boy
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Re: Entrance Fee for Retirement Community

Post by TN_Boy »

Prudence wrote: Sun Oct 20, 2019 2:43 pm We considered an CRCC and an independent living community, and, we preferred the latter. If we plan to stay until we die in the latter, we would need to plan on having assistance and then nursing care in the unit (in home care) at some point. I was thinking that, at some point in the future, we would probably need to relocate from the independent living community that we like to a place like CRCC that has assisted living and nursing care. Maybe this (two moves) is not a wise plan.
I agree with others, waiting until you need care to move to a CCRC is probably not a viable plan. You likely can't get in. Around here the better ones have wait lists that are several years long.

I'm sure you are also aware that having assisted living and nursing care in the home becomes extremely costly if you need lots of help. 24x7 in-home help is really expensive, and that's for unskilled help. I imagine in-home skilled nursing would be wildly expensive if you needed lots of it. Which is why a lot of people who say they would never leave their home, do. Or they get dementia with major wandering issues and well, the person needs to be in a locked facility.
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Prudence
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Re: Entrance Fee for Retirement Community

Post by Prudence »

Agree 100%! Thanks.
stan1
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Re: Entrance Fee for Retirement Community

Post by stan1 »

Some people in their 60s are going to want to live around people of all ages, not mostly people who are a lot older and much less healthy.

I have just three data points where my family has used private pay, month to month facilities.

1) When my grandmother needed space in a private pay month to month Alzheimer's group home with 6 beds there was a three month wait. The home was well run.

2) When my mom needed an independent living apartment (month to month) there was no waiting list and there was a choice of rooms available. She picked a ground floor two bedroom unit. This was at an older but well cared for and well managed property (not luxury). As an example of what I mean by "not luxury": meals are simple (meatloaf, etc), there is one planned morning and one afternoon activity each day, and bus transportation to medical appointments is only available one morning per week.

3) When my in-laws needed an 2 bedroom apartment at a month to month facility that offered assisted living services inside the apartment the waiting list magically cleared. Again it was not the newest facility in the town and not luxury. The facility incentivized a recent widow to move from a 2 bedroom to a 1 bedroom unit. Once the facility understood in laws had low seven figure net worth and would likely be residents for several years they were very accommodating. Likewise when MIL had to go into a memory care ward and then shortly thereafter a nursing home as a private pay patient there was no problem getting a bed.

With my admittedly limited three data points in different high, medium, and low cost areas I think its possible to go private pay month-to-month when needed. There are many facilities and they compete for private pay patients. Even in a small city we found several choices. The CCRC is a lifestyle choice before you need a lot of care.
RudyS
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Re: Entrance Fee for Retirement Community

Post by RudyS »

Another datapoint. DW and I are 78/83. Moved to a CCRC with lifecare plan several months ago. We enjoy the community spirit, lots of things to do, the other residents are almost all very friendly and outgoing. This place (independent living apts, assisted living, skilled nursing) is all in a couple of connected buildings, including the commons for meals and R&R. We see detached villas, etc, as a big drawback especially in winter here in NE. We find ourselves going from our apt to an event or group, or the evening dinner, several times a day. Would not want to have to get dressed for the weather each time. Although most of the folks here are in independent living apartments, quite a few use walkers. That'd be harder going to/from a cottage. So we insisted on the "one building" version. We thought it to be a good idea to move while still healthy enough to qualify.
drawpoker
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Re: Entrance Fee for Retirement Community

Post by drawpoker »

RudyS wrote: Tue Oct 22, 2019 11:42 am .......We see detached villas, etc, as a big drawback especially in winter here in NE. We find ourselves going from our apt to an event or group, or the evening dinner, several times a day. Would not want to have to get dressed for the weather each time......So we insisted on the "one building" version......
The CCRC's that offer a mix of cottage/villa units also provide courtesy transportation to those residents. Door to door service to get to main bldg & back for meals, events, doc appts, beauty salon. Not just for bad weather, but anytime.

Even in nice weather a walk of 100, 200 yards or so may be too much for some. :|
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Re: Entrance Fee for Retirement Community

Post by fposte »

delamer wrote: Mon Oct 21, 2019 1:46 pm
Based on my personal observation, I wouldn’t move to a CCRC until age 75 or so. Unless, of course, I had a progressive medical condition that made the CCRC a good option for the future and I was afraid that I couldn’t qualify if my condition deteriorated.
Note also that a lot of CCRCs have waiting lists and often they allow you to demur when your turn comes without going to the back of the line. In cases like that, I think it makes sense to get on the waiting list early (usually there's a fee--I think it's $1k at the one I'm considering) so that you're in a better position when you think it's time to move. Just don't "one more year" your way out of qualifying, as a friend's parent did.

I think also it's a decision that varies a lot depending on how much of a transition is involved. My father moved states away because what he was looking for couldn't be found near him; I'm likely to be moving 5 minutes away if I choose a CCRC. That means the rest of my life is going to be a lot more consistent than it was for him, so I could see moving earlier if I had the downsizing urge rather than doing an intermediate move.
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Re: Entrance Fee for Retirement Community

Post by ChrisC »

drawpoker wrote: Tue Oct 22, 2019 12:04 pm
RudyS wrote: Tue Oct 22, 2019 11:42 am .......We see detached villas, etc, as a big drawback especially in winter here in NE. We find ourselves going from our apt to an event or group, or the evening dinner, several times a day. Would not want to have to get dressed for the weather each time......So we insisted on the "one building" version......
The CCRC's that offer a mix of cottage/villa units also provide courtesy transportation to those residents. Door to door service to get to main bldg & back for meals, events, doc appts, beauty salon. Not just for bad weather, but anytime.

Even in nice weather a walk of 100, 200 yards or so may be too much for some. :|
We’re on a 4 year long waitlist for a CCRC in NC, and our priority wait is for a cottage and, if that’s not available then a high floor in a Villa apartment. (We don’t expect to move into this CCRC, if at all, for at least 6-7 years from now; we’re currently 66 and 68.)

This would be a luxury purchase and a life/style choice for us. This CCRC has 60 plus separate cottages and 300 plus apartments in 5 bldgs with large community and fitness centers, and a 60 bed skilled nursing facility that might undergo another 30 bed expansion. It has 425 plus residents with a very active community lifestyle. The SNF on campus has the trappings of a college dormitory, and not the predominant institutional feel we’ve come to have known over the years from placements of relatives.

We prefer the cottages to walk around the campus. Transportation is provided around the campus and to medical appointments outside of the campus. The CCRC provides for take home delivery services from its dining facilities; you can order lunch or dinner from the dinning facilities and have it delivered to your unit, or you can cook meals yourself. Our waitlist application fee entitles us to dine for lunch there once a month, and thus far the food is quite good.

Every time a high maintenance item in our house goes bad (we replaced HVAC units, flooring, water heater, etc.) it moves us closer to thinking that the CCRC would fit us well.
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Prudence
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Re: Entrance Fee for Retirement Community

Post by Prudence »

fposte wrote: Tue Oct 22, 2019 12:20 pm
delamer wrote: Mon Oct 21, 2019 1:46 pm
Based on my personal observation, I wouldn’t move to a CCRC until age 75 or so. Unless, of course, I had a progressive medical condition that made the CCRC a good option for the future and I was afraid that I couldn’t qualify if my condition deteriorated.
Note also that a lot of CCRCs have waiting lists and often they allow you to demur when your turn comes without going to the back of the line. In cases like that, I think it makes sense to get on the waiting list early (usually there's a fee--I think it's $1k at the one I'm considering) so that you're in a better position when you think it's time to move. Just don't "one more year" your way out of qualifying, as a friend's parent did.

I think also it's a decision that varies a lot depending on how much of a transition is involved. My father moved states away because what he was looking for couldn't be found near him; I'm likely to be moving 5 minutes away if I choose a CCRC. That means the rest of my life is going to be a lot more consistent than it was for him, so I could see moving earlier if I had the downsizing urge rather than doing an intermediate move.
Agree. Since my original post, we are looking at three very nice CRCCs that are within five miles of the house we have lived in for 39 years. They have waiting lists so we plan to bite the bullet and put in a deposit (maybe more than one) and hope a desirable unit becomes available within the next two or three years.
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Re: Entrance Fee for Retirement Community

Post by drawpoker »

ChrisC wrote: Tue Oct 22, 2019 1:25 pm We’re on a 4 year long waitlist for a CCRC in NC.....
No surprise there. With a mild year-round climate, low taxes, and top-notch medical facilities at nearby Durham-Raleigh-Chapel Hill corridor, NC is rapidly becoming a hot spot for these CCRC's.

I envy you...... :(
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Re: Entrance Fee for Retirement Community

Post by delamer »

Prudence wrote: Tue Oct 22, 2019 2:47 pm
fposte wrote: Tue Oct 22, 2019 12:20 pm
delamer wrote: Mon Oct 21, 2019 1:46 pm
Based on my personal observation, I wouldn’t move to a CCRC until age 75 or so. Unless, of course, I had a progressive medical condition that made the CCRC a good option for the future and I was afraid that I couldn’t qualify if my condition deteriorated.
Note also that a lot of CCRCs have waiting lists and often they allow you to demur when your turn comes without going to the back of the line. In cases like that, I think it makes sense to get on the waiting list early (usually there's a fee--I think it's $1k at the one I'm considering) so that you're in a better position when you think it's time to move. Just don't "one more year" your way out of qualifying, as a friend's parent did.

I think also it's a decision that varies a lot depending on how much of a transition is involved. My father moved states away because what he was looking for couldn't be found near him; I'm likely to be moving 5 minutes away if I choose a CCRC. That means the rest of my life is going to be a lot more consistent than it was for him, so I could see moving earlier if I had the downsizing urge rather than doing an intermediate move.
Agree. Since my original post, we are looking at three very nice CRCCs that are within five miles of the house we have lived in for 39 years. They have waiting lists so we plan to bite the bullet and put in a deposit (maybe more than one) and hope a desirable unit becomes available within the next two or three years.
That’s what my parents did, although I think it took them about 5 years to finally decide to move. But if they turned down a particular apartment (which they did a couple times), they were kept at the top of the waiting list.
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Re: Entrance Fee for Retirement Community

Post by Kagord »

gasdoc wrote: Mon Oct 21, 2019 1:32 pm For the purposes of the "audience," at what age does one generally consider a move to a CCRC? In The Villages, in Florida, many people move there in the late 40's and throughout their 50's. In less active 55+ communities that I am familiar with, it seems like people move there in their 70''s. Thanks!

gasdoc
CCRCs, they don't like to publish this, but the few I checked with, after being very persistent on getting an answer, both said 80-85 was the average age of people entering. There's a qualification, you have to have an appropriate net worth, income, and be evaluated to be self sufficient for independent living, and likely to be independent for 2+ years.

Had several experiences of people putting off, then a fall or something, and well, less attractive options after that. I think the Type A CCRCs are kind of like an LTC insurance alternative.
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Prudence
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Re: Entrance Fee for Retirement Community

Post by Prudence »

That's one of the primary reasons we are going to put down a deposit on a CRCC. If we wait until we need assisted living or comprehensive care, it is unlikely that we would be accepted into the nice nearby CRCCs that we could tolerate living in. So, it is better to come in to independent living when we have some control rather than wait until there is not an acceptable option.
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Re: Entrance Fee for Retirement Community

Post by ChrisC »

Prudence wrote: Fri Oct 25, 2019 6:28 am That's one of the primary reasons we are going to put down a deposit on a CRCC. If we wait until we need assisted living or comprehensive care, it is unlikely that we would be accepted into the nice nearby CRCCs that we could tolerate living in. So, it is better to come in to independent living when we have some control rather than wait until there is not an acceptable option.

A common refrain for those living in a CRCC is that "it's better to be 5 years early than 5 minutes late." In our case, we are on a waitlist but don't expect to get offered a unit for 3 or 4 years -- if that occurs, we'll re-evaluate our situation. We made a $1000 refundable deposit to be on the waitlist, and paid an application/processing fee of $100 each. After 4 years, we would have to pay another application fee but we keep our place on the waitlist. We ran into someone who's been on this waitlist for 7 years and they are in their mid-70's -- they have been offered units but just not ready to take the leap.

Being on the waitlist for this CCRC has its benefits; we have a monthly pass to dine for lunch (with two additional guests) at the dinning facilities -- we've brought our children and friends to dine with us and tour the campus. We also get a steady stream of insider information from the CCRC.

'
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Prudence
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Re: Entrance Fee for Retirement Community

Post by Prudence »

Update. Last week we paid a refundable deposit for one of the newest and nicest CCRCs in the area, only five miles from our home. We are on a waiting list and could wait at least three years to get an acceptable unit, in independent living. After independent living, if needed, we would receive priority to move to assisted living or comprehensive care (a private nursing unit) in the CRCC. The CRCC is very nice but extremely expensive. So, I am thinking it may be wiser to decline and terminate the deposit and waiting list, and, when necessary, move to an assisted living facility or nursing home. I am thinking that it will not be difficult to be admitted to assisted living or a nursing home when the time comes. Am I correct?
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Re: Entrance Fee for Retirement Community

Post by delamer »

Prudence wrote: Wed Nov 20, 2019 1:26 pm Update. Last week we paid a refundable deposit for one of the newest and nicest CCRCs in the area, only five miles from our home. We are on a waiting list and could wait at least three years to get an acceptable unit, in independent living. After independent living, if needed, we would receive priority to move to assisted living or comprehensive care (a private nursing unit) in the CRCC. The CRCC is very nice but extremely expensive. So, I am thinking it may be wiser to decline and terminate the deposit and waiting list, and, when necessary, move to an assisted living facility or nursing home. I am thinking that it will not be difficult to be admitted to assisted living or a nursing home when the time comes. Am I correct?
What’s the downside of staying on the waiting list, other than losing a small amount of income from not having the deposit money invested?

Good quality facilities often have waiting lists currently. With the large boomer generation being in increasing need of care, I wouldn’t bet that it will be easy to find a spot in a timely basis.

Odds are very high that you and your spouse will have different health trajectories. So the idea that “we” will move to assisted living to a nursing home when needed is unrealistic.

What happens if you are in your current home and you need to move into assisted living but your spouse does not? Do you want to be in the position — financially, logistically, emotionally — where your spouse is trying to juggle you living in a facility while maintaining your current home? Compare that to your spouse being comfortably settled in your independent apartment/cottage surrounded by friends and able to visit you easily in your assisted living unit, without all of the other issues going on.

Having said all that, maybe neither of you will ever need to live in a facility for even a short period of time. But don’t underestimate the difficulty of dealing with that need should it arise.
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Re: Entrance Fee for Retirement Community

Post by RickBoglehead »

Prudence wrote: Wed Nov 20, 2019 1:26 pm Update. Last week we paid a refundable deposit for one of the newest and nicest CCRCs in the area, only five miles from our home. We are on a waiting list and could wait at least three years to get an acceptable unit, in independent living. After independent living, if needed, we would receive priority to move to assisted living or comprehensive care (a private nursing unit) in the CRCC. The CRCC is very nice but extremely expensive. So, I am thinking it may be wiser to decline and terminate the deposit and waiting list, and, when necessary, move to an assisted living facility or nursing home. I am thinking that it will not be difficult to be admitted to assisted living or a nursing home when the time comes. Am I correct?
I'm confused. This thread discusses how it's sometimes difficult to get in a facility when needed, and that many have long waitlists. You agreed with those conclusions, paid the deposit, and then want to pull it, because now you think it won't be difficult to be admitted to assisted living or a nursing home when needed. What changed?

My in-laws suddenly needed assisted living, having done zero planning. One got ill, then went to rehab. Other got ill, joined first in rehab. Then it was time for first one to go to assisted living. Found a vacancy. 3 weeks later, when it was time for the second one to join the first one, admittance was declined because of behavior exhibited at the rehab facility. Then we had to scramble. No one had a vacancy. We put them in independent living, which lasted for 4 months, and then the unruly one was moved to a restricted assisted living facility (can't leave).

Here's my take - if the deposit is $500 or $1,000, do it. If something comes up, you can decline.
delamer wrote: Wed Nov 20, 2019 2:11 pm But don’t underestimate the difficulty of dealing with that need should it arise.
This ^^^^
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Re: Entrance Fee for Retirement Community

Post by fposte »

Some of this is dependent on your area. But for me 90% of the point of a CCRC is getting that pipeline to assisted living and nursing, because outside of it it's dependent on luck, deep pockets (my friend directly admitted to an SNF paid a lot more than the CCRC costs at the place I'm considering), and external advocacy where you end up. I'd definitely stay on the waiting list, and I too am curious what changed from your initial interest.
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Re: Entrance Fee for Retirement Community

Post by drawpoker »

Prudence wrote: Wed Nov 20, 2019 1:26 pm ....... Am I correct?
Frankly, no, don't think so.

delamer gave excellent advice to you when replying to your update.
Please re-read what delamer wrote and re-think your long-range plan.
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Prudence
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Re: Entrance Fee for Retirement Community

Post by Prudence »

I agree that we can stay on the waiting list. Nearby the CCRC, within a couple of years, we could buy a large three BR condo on a single floor with an elevator and move out of our house. It would cost much less than the luxury CCRC. When needed, we could hire a care giver to come to the condo. When this becomes impractical, one of us could then relocate to an assisted facility or nursing home. This would be much less costly than the CCRC. But, some of the comments indicate that a decent assisted living or nursing home may be difficult to get into. So, that is a big risk and my dilemma. The CCRC would provide us/me with a lovely place to live, and in the future, security to transfer to assisted living and or comprehensive care (private nursing unit) in the CCRC. Of course, the comprehensive care would be extremely expensive, but, we have saved for it. (This CCRC has a policy of not booting a resident out if they run out of money; so that also provides security).
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Prudence
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Update: Entrance Fee for Retirement Community

Post by Prudence »

Update: The CRCC we love just offered us an apartment that we love. It is a high end CRCC with a high refundable entrance fee and a high monthly fee. If a resident terminates the arrangement, the CRCC will not release the refundable entrance fee until a new resident has paid an entrance fee. Ordinarily, we would sell our house and take this apartment. We currently live in Maryland close to this CRCC. We are concerned that, due to Covid impacts, this would be a very bad time to move to an CRCC. (From March through June, the CRCC had to suspend move ins. The delay in collecting entrance fees caused them liquidity issues according to their CFO. This is well-run non-profit BTW). The worst of the Covid situation could be ahead with a return to stay at home guidance. We are 73 and 68. Worst case is that this CRCC would go into bankruptcy or foreclosure and we would lose a big chunk of the entrance fee and have to find another place to reside. If we pass on this apartment, it will be several years before we get a similar opportunity for a unit that we love. We are fine in the house, so, do you think it would be a mistake to take this risk and move?
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Re: Entrance Fee for Retirement Community

Post by Point »

One of the things you want to consider is both your family health history, and longevity. Coupled with that, for memory issues, it's better to move and acclimate sooner as opposed to later as this may extend your living in residence longer before moving to memory care. For me, I would also look at the exercise facilities, group exercise opportunities, and space beyond the inside walls.

We were able to help my wife's uncle decide on a location by going there and having a meal with the residents. A nice attribute was that the owner had well trained dogs for the residents to mingle with as well. This was in the assisted living component.

Covid changes everything in the short term, but if you're looking at a residence, then it's more about the shelter in place capabilities than shared living spaces, with the exception of skilled nursing facility. What was the experience of the skilled nursing facility during the first wave of Covid? Does that experience affect your view of their viability?
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Re: Update: Entrance Fee for Retirement Community

Post by delamer »

Prudence wrote: Sun Jun 28, 2020 12:41 pm Update: The CRCC we love just offered us an apartment that we love. It is a high end CRCC with a high refundable entrance fee and a high monthly fee. If a resident terminates the arrangement, the CRCC will not release the refundable entrance fee until a new resident has paid an entrance fee. Ordinarily, we would sell our house and take this apartment. We currently live in Maryland close to this CRCC. We are concerned that, due to Covid impacts, this would be a very bad time to move to an CRCC. (From March through June, the CRCC had to suspend move ins. The delay in collecting entrance fees caused them liquidity issues according to their CFO. This is well-run non-profit BTW). The worst of the Covid situation could be ahead with a return to stay at home guidance. We are 73 and 68. Worst case is that this CRCC would go into bankruptcy or foreclosure and we would lose a big chunk of the entrance fee and have to find another place to reside. If we pass on this apartment, it will be several years before we get a similar opportunity for a unit that we love. We are fine in the house, so, do you think it would be a mistake to take this risk and move?
Barring any specific health conditions that might cause your health to deteriorate and make you ineligible to move to the CRCC in several years, I’d wait until the pandemic plays out.

Your ages are young to move into a CCRC anyway.
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Prudence
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Re: Entrance Fee for Retirement Community

Post by Prudence »

Point wrote: Sun Jun 28, 2020 1:00 pm One of the things you want to consider is both your family health history, and longevity. Coupled with that, for memory issues, it's better to move and acclimate sooner as opposed to later as this may extend your living in residence longer before moving to memory care. For me, I would also look at the exercise facilities, group exercise opportunities, and space beyond the inside walls.

We were able to help my wife's uncle decide on a location by going there and having a meal with the residents. A nice attribute was that the owner had well trained dogs for the residents to mingle with as well. This was in the assisted living component.

Covid changes everything in the short term, but if you're looking at a residence, then it's more about the shelter in place capabilities than shared living spaces, with the exception of skilled nursing facility. What was the experience of the skilled nursing facility during the first wave of Covid? Does that experience affect your view of their viability?
I don't know. We walked through the skilled nursing unit several months ago (pre-Covid) and they had lots of open beds. Last week, they told me that so far one resident in skilled nursing care and two staff had tested positive for the novel coronavirus. In general, residents check in and check out (it is quick) when they leave the CRCC building and their temperature is taken when they return (and they are given a face mask to wear).
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