Rethinking CCRC living

[Walt34]

We received yet another mailing today about a CCRC located mostly in PA, but has some facilities in MD, DE, and OH and I was looking through their website, impressed that the pricing was not hard to find. Most of these retirement community sites make pricing difficult to find if it is even there at all, and want you to call and make an appointment so they can sell you. In the past I've been a fan of CCRCs because it worked out so well for my mother, and would have worked out well for DW's father if he hadn't been so stubborn about staying in his house that he couldn't afford to keep.

But with the rising costs of every type of retirement community I'm rethinking that. For one thing the monthly maintenance costs are consistently rising faster than our COLA'd income and I just don't see much future in placing ourselves in that position. And the monthly fees for even independent living, where you don't need any assistance for anything, is astronomical, from $1,100 for a small one bedroom apartment to north of $4k for a single-family house, and that after a (usually) six-figure entrance fee. Some of the smaller one-bedroom apartments in middle PA are mid five figure entrance fees.

So I got to thinking, "How much DOES it cost to live here in our paid-for house?". I went back in Quicken and looked up what we'd spent on house maintenance for the last ten years. I did not include utilities because I think those would be about the same anywhere in a detached house.

The number I came up with was ~$400/month, which includes all the "lumpy" expenses like having the water line from the street to the house replaced, property taxes, replacement appliances, and the cost of special tools for a specific job, paint, (and having some painting done) and all the other odds 'n ends that I could think of that come with owning a house. The house we're in is nice, we think, but nothing luxurious - about 1,700 SF on the first floor, three bedroom, three bath, partially finished off basement (one bath is there), normal appliances, two-car attached garage, 1/4 acre lot in a subdivision. We have yet to replace the roof, and I figure roughly $15-$20k for that, which for a 25-year roof would add ~$65/month if it was $20k. Maybe I'm getting too granular here.

I do all the maintenance that I can but even if I had to pay someone for every little thing, it still wouldn't add significantly, I don't think. And in a CCRC environment the travel time for maintenance people would be virtually nil greatly reducing their expenses.

So where do these places (that claim to be non-profit!) come up with $3,000/month+, plus utilities, for a single-family house that is usually smaller than this one? Okay, I get that they have full time maintenance staff but are they all MIT "maintenance engineers" or something?

Maybe someone can educate me more about the expenses of maintaining the environment of a CCRC, a mixture of single family, townhouses, cottages, and apartments and break it down to unit costs. Disregard for now the costs of medical care - that's an additional expense not included in independent living plans in most places. But right now it seems like the cheapest place for us to live is where we are right now by a long shot even if I did have to hire out every little maintenance item, like replacing a furnace fan filter.

And even if we did have to hire a cleaning service (not unforeseeable) and have a handyman on speed dial, the costs would still be way less than a CCRC. Am I missing something huge?

Is there some humongous expense with a CCRC that I'm overlooking that justifies their cost?

 

[OldShooter]

... So where do these places (that claim to be non-profit!) come up with $3,000/month+, plus utilities, for a single-family house that is usually smaller than this one? Okay, I get that they have full time maintenance staff but are they all MIT "maintenance engineers" or something?

Maybe someone can educate me more about the expenses of maintaining the environment of a CCRC, a mixture of single family, townhouses, cottages, and apartments and break it down to unit costs. ...

I know nothing about CCRCs, but you can download the tax return for any but the smallest US nonprofits at https://www.guidestar.org/ They make very interesting reading, including P&Ls and Balance Sheets plus salaries of the top people. These don't break things down as far as you're asking but should give you some clues. Comparisons among nonprofit CCRCs may be interesting too.

To download, you need to register as a Guidestar user. I did this a number of years ago and have never been spammed or been aware of any negative consequences. No promises, though. Just my experience.

 

[W2R]

Walt, I've been having second thoughts about a CCRC, also.

I am an introvert and really don't like socializing with a lot of people. I find many/most people to be borderline annoying (in person! not here). I imagine there would be a lot of them bugging me at a CCRC. Here in my Dream Home I never have to deal with people other than Frank, and I love having him come over.

And what about laundry? Most CCRC's I encountered seem to have a communal laundry instead of a washer dryer in each unit. I don't want to lug my dirty laundry somewhere else to use a shared washer. Here in my Dream Home, the washer is just right here in my own laundry room, about 15 feet from where I am sitting.

What will they do with my Amazon packages? I suppose I'll have to go down to the office and lug them back up to my unit. Here in my Dream Home, all I have to do is push the package about 3 feet from the front porch into my house.

What about high speed internet? Maybe they have really bad speeds. I have great internet here in my Dream Home.

What about Covid and other communicable diseases? BTDT, don't wanna go through that ever again.

I dunno. There are so many potential negatives.

To me, the main advantage is having somebody reliable to check on me every single day without fail in case I fall and break a leg or some such thing. Frank does that now, but if (heaven forbid) he goes first, I should arrange some way to get checked on every day. Maybe there's an easier way to arrange that, even if I am still living at home.

 

[Silver]

There was recently a thread about some CCRC's closing their skilled nursing facilities because of the cost/reimbursement. That area of the center may be a large cost in any CCRC because of the more highly skilled staff. Not just nursing; there are usually physical therapists, occupational therapist as well as speech-language pathologists, and others.

I would guess that residents in independent living are supporting the costs of other areas as well as their own costs.

 

[aja8888]

My SIL in So. California went into one this Spring. Her husband died two years ago and she sold the house as she was lonely. I understand she paid $600 K as a deposit and the cost is north of $10 K per month.

She is 77 and perfectly capable of living on her own but is a "control freak" and a real PIA. None of her children want to have to take care of her later in life ().

When she calls my DW (her sis) to chat, she is complaining about everything in this place, but she complained about everything her whole life anyway.

We all hope she stays there.

 

[Jerry1]

Walt - I need you to go talk to my dads wife. I tried to get them to move to a better situation than their current house - either downsizing or some type of assisted living arrangement. Dad was basically on board but his wife was not. Now, dad is experiencing dementia and the stuff is hitting the fan. Nothing insurmountable, but his wife doesn’t want to pay for any of it. Things like gutter cleaning and lawn care with fall clean-up on the horizon. I keep trying to tell her that this is the cost of staying in your home. As you calculated, there’s no way it’s costing more to maintain the house than moving into assisted living, but she’s just not getting on board.

Personally, I think you’re correct. My house is manageable, but I’m on an acre. Outside work will have to be farmed out, probably sooner than later. Fortunately, the house is not big (1700 sq ft) and all one level (on a slab). So I think I can live here pretty far into my years. But, it will cost money to get the help I will need. Still, short of some debilitating medical situation, it should be doable and for less than many of the alternatives.

In my situation, property taxes on the house are a bit of an issue, but they’re currently under $5K per year. Add another $7K per year for maintenance and another $12K for all types of help (yard, housekeeper . . .) and I’d be up to $2K per month. Seems high (to be conservative) but that would be lower than many other options.

As always, the wildcard is health. As my dads wife is finding out, it ain’t easy being in your late 80’s taking care of a 90 year old with dementia. A plan is needed before it gets to that point and we (my wife and I) are trying to put those plans into place. I don’t want my only plan to be “I want to stay in my house”. Of course I do, but at some point, that’s not always possible and I don’t want to put the burden of being the “bad guy” onto my daughters.

 

[captain3d]

No one mentioning the opportunity cost of the paid off home? Investors want returns on their money. That is why it is expensive.

 

[RetMD21]

There was recently a thread about some CCRC's closing their skilled nursing facilities because of the cost/reimbursement. That area of the center may be a large cost in any CCRC because of the more highly skilled staff. Not just nursing; there are usually physical therapists, occupational therapist as well as speech-language pathologists, and others.

Are you sure it is skilled care? That can be a money maker. Custodial care is another matter. MIL's older CCRC opened an Assisted Living/Memory care wing (not included as a CCRC benefit) and between than and home health care their custodial care has fallen off. They are contractually obligated to find "comparable" care elsewhere if necessary. Who knows how comparable it will be.

 

[JoeWras]

So I saw Walt's $400 a month and thought to myself: "Self, that seems low." Perhaps it is because in the last 3 years we had:
- two different concrete repairs, one major to the tune of $4k
- new roof
- new water heater
- major tree work ($10k!)
- new HVAC unit

In the last three years, it has been more like $1000 per month.

But I know this is anomalous, so I went back 12 years. Guess what the number came out to per year? $4750. Ding, ding, ding: same as Walt's $400 per month!

As for CCRC's, I've gone back and forth on it. I'd rather stay here as long as we can. Stairs are a concern, but not a major one, yet.

 

[RobbieB]

Nah, I'm just gonna tuff it out at home. Wife is 10 years younger, care givers are available and that's a good thing.

 

[Teacher Terry]

My friend is in assisted living apartment. They charge between 5500-8k/month depending on how much help you need for a studio apartment. There’s no buy in. When he was in independent living he had a 1 bedroom for 3300/month. It’s been a lifesaver for him as otherwise he would be in a nursing home.

My friend wears diapers, needs medication 3xs a day, daily shower, dressing and help getting in and out of bed. Sometimes he can’t get out of a chair. He wears a button to call for help. He has Parkinson’s among other issues so this allows him privacy and dignity but he can participate in any of the activities and also have people to talk to.

 

[nwsteve]

Currently living in a Type A CCRC. The decision to live in a CCRC is more than just a trade-off against historic costs of home ownership. There are several other considerations, which require a broader appreciation of future tradeoffs. For example, folks often think hiring help will be easy and timely--they should check the current availabilities to get a skill trade quickly in their location. We are currently having an electrical issue with our power panel--breakers keep going off. Call to our onsite facilities services this morning, got two defective breakers replaced by Noon. Replacement revealed more serious issue requiring skilled electrician. One will be here tomorrow morning at 8:30. Personally, I never had that response when I needed an electrician for my SF home. Also consider the entire process for finding much less qualifying a skill trades provider. Then, getting a service call in less than two weeks. Demographics don't look good for the near future. Same goes for healthcare providers.
Then there is the issue of when you need higher levels of care than a home provider can offer. How will the decision and who will make it for where you get "PUT". Personally, we did not want our DD having to find time and making that decision. Not that she could not get it done, but what choices would she actually have as more and more of our fellow boomers also need care. You will NOT get into a Type A CCRC in impaired health. Many if not most CCRCs already long wait lists.
We have not even touched on the benefit of having a known environment for your recovery from a joint replacement or the mental health benefit of having your spouse onsite for easy visits while your recover. No commute for your PT or OT while you recover from a catastrophic event like a stroke.
More simply, most of us do not have a solid internalization of the changes each individual faces as you age and the mental as well economic resources our final chapters require.

 

[daylatedollarshort]

We're working on getting everything in our house updated and off grid, at least as much as we can living in an urban area, so it is low cost and low maintenance in our later years. There might be some day where we can't stay here, but in as far as future needs, our city has a door to door senior bus service, a senior center with activities and prepared lunches, and subsidized ride share programs. Plus now there is Instacart for grocery and many other kinds of deliveries. So even if we weren't driving we could live in our same house, at least until we might need more day to day personal care eventually. If we couldn't do stairs, there is enough room, with some remodeling, for both of us to live on the lower level. That is the same size as the condos at the biggest senior living community near us anyway, plus in our own house we would still have a garage and a nice size yard to putter around in.

For minor repair work, we discovered Taskrabbit. It isn't the cheapest, but when we had a minor emergency repair, we were able to have a choice of handymen with good reviews who could come out right away. That sure beat calling around to people who either never replied or could come out in 4 weeks time. I've also been getting ads for a service called Hidrant, which we haven't used yet but is supposed to be off duty firemen who do handyman work. I might give them a try for our next minor repair list.

 

[JoeWras]

We have not even touched on the benefit of having a known environment for your recovery from a joint replacement or the mental health benefit of having your spouse onsite for easy visits while your recover. No commute for your PT or OT while you recover from a catastrophic event like a stroke.

This is compelling to me. We have friends exactly in this situation. They are in a CCRC and this is working great for them. We are so happy that it is working out for them.

But why am I hesitating about the idea? Because the language of the CCRC contracts tilt in their favor such that they can move this service elsewhere (as discussed above). What exactly am I buying that I'll need in 10 years, and more importantly, will it still be here, on the property?

 

[audreyh1]

Currently living in a Type A CCRC. The decision to live in a CCRC is more than just a trade-off against historic costs of home ownership. There are several other considerations, which require a broader appreciation of future tradeoffs. For example, folks often think hiring help will be easy and timely--they should check the current availabilities to get a skill trade quickly in their location. We are currently having an electrical issue with our power panel--breakers keep going off. Call to our onsite facilities services this morning, got two defective breakers replaced by Noon. Replacement revealed more serious issue requiring skilled electrician. One will be here tomorrow morning at 8:30. Personally, I never had that response when I needed an electrician for my SF home. Also consider the entire process for finding much less qualifying a skill trades provider. Then, getting a service call in less than two weeks. Demographics don't look good for the near future. Same goes for healthcare providers.
Then there is the issue of when you need higher levels of care than a home provider can offer. How will the decision and who will make it for where you get "PUT". Personally, we did not want our DD having to find time and making that decision. Not that she could not get it done, but what choices would she actually have as more and more of our fellow boomers also need care. You will NOT get into a Type A CCRC in impaired health. Many if not most CCRCs already long wait lists.
We have not even touched on the benefit of having a known environment for your recovery from a joint replacement or the mental health benefit of having your spouse onsite for easy visits while your recover. No commute for your PT or OT while you recover from a catastrophic event like a stroke.
More simply, most of us do not have a solid internalization of the changes each individual faces as you age and the mental as well economic resources our final chapters require.

Exactly. We have no children. Once you have poor capacity how on earth are you going to hire and manage the help you need to stay in your home, not to mention other house expenses, bill paying etc? This is an incredibly high obstacle to overcome.

 

[Aerides]

Last year we replaced our HVAC, had some other relatively minor things, but still had $10k in unplanned household expenses. $2k in some tree trimming (no way to do ourselves, too big). And we pay for lawn service.

This year we're over 10k in new duct work, and our fence needs replacing (10k). I needed to take out 10 feet of 25 ft high bamboo to do the fence...another $2k. And we're only in the 3rd quarter!

Our home owners went up as well.

$4k all in for a SFH in a CCRC sounds pretty good! Decent new apartments in my area are going for that, SFH rentals are over $5k. The house next door to me rents for $4, but they are longer term tenants, and their agreement doesn't include lawn/pool maintenance.

 

[athena53]

This is compelling to me. We have friends exactly in this situation. They are in a CCRC and this is working great for them. We are so happy that it is working out for them.

But why am I hesitating about the idea? Because the language of the CCRC contracts tilt in their favor such that they can move this service elsewhere (as discussed above). What exactly am I buying that I'll need in 10 years, and more importantly, will it still be here, on the property?

It worked well for my Grandpa and his second wife although after step-Grandma died and he was failing he waited WAY too long to go into the LTC center- insisted on 3 shifts of home health care people, some of whom weren't too great (would hold electric shaver up by the cord, shaver would fall off and break, needed new shaver). Finally Mom, who was taking care of his finances, told him he HAD to move to the LTC center because he was running out of money. He died with almost nothing but Mom and her brothers were OK with not inheriting anything.

The idea of LTC facilities not being available or costs going up a lot scares me, too, if you have a plan where you bought into the CCRC and can't get a refund if you move. I'm leaning towards places where I can change my mind if services deteriorate or they jack up the rates to unacceptable levels- maybe a complex with Independent and Assisted Living units, and moving if I need LTC.

When Dad entered LTC in April, 2020 after a stroke, my siblings in the area placed him in a good LTC facility and shortly thereafter they increased the rates by about $3K/month- you know, COVID. Dad died last October and they still hadn't removed the surcharge. I wonder if they have yet.

 

[HarryHawk]

We are in the process of moving into a CCRC complex that is currently being built. At the very first meeting with the reps from the CCRC, the first thing they said to us - 'This will NOT be the most economical choice regarding your required living expenses."

At this point, we feel the benefits will be worth the extra expense, but only time will tell.

 

[JoeWras]

No kids for us too.

When the time gets closer, I think we'll have to balance long-term CCRC buy-in vs waiting and going with short term places.

The friends we have in CCRCs are very, very happy with their choice. But they are nearly a generation ahead of us.

I've learned that being in the Generation Jones gap can bite you in the butt. The world seems to learn about the problems of products and services as the huge Boomer wave goes through them. Example: pensions, corporate sponsored medical insurance. We got them ripped right out of our hands. I'm a bit scarred by that and feel like it could happen with CCRCs too.

But it is probably just me.

 

[braumeister]

I'm very much looking forward to going to a CCRC when I get to "a certain age" simply because it removes most of the worries about daily life, travel, etc.

We're basically one step removed now, being in an excellent condo environment, but having the staff of a CCRC available to deal with unforeseen situations would be a big advantage.

As long as I can handle things I plan to stay here, but the day is definitely coming.

 

[Bamaman]

I read about those that have very high maintenance and upkeep costs on their sticks and bricks home. It's a lesson to take care of maintenance on a periodic basis rather than have everything replaced or redone at one time.

My mother paid $170K to get into a first rate CCRC--1 bedroom apartment with kitchen. It cost $2K per month "rent" including 20 meals in the most lavish restaurant (Dutch chef) in the city. She had the ability to go into assisted living and even full nursing home care in the same place. When she passed, we got 90% of the $170K back.

My mom ended up having 24/7 help to watch her closely, and she quickly went through all her money. Nice CCRC's are really luxury accommodations, and often out of the ability of a middle class family to pay.

My aunt was first in a nice assisted living 1 bedroom apartment @ $2,050, and we had to pay $500 extra to have her medicines given. She was there for 3 years until dementia got the best of her and she had to go to full nursing home care @ $7,000 per month. While she complained a little, these were the best years of her last 20 years.

I feel sorry for those in high COL places or large cities paying for CCRC's and full nursing home care. We're just fortunate in our part of the Mid South to have cheaper alternatives--and a low cost of living.

 

[Silver]

Are you sure it is skilled care? That can be a money maker. Custodial care is another matter. MIL's older CCRC opened an Assisted Living/Memory care wing (not included as a CCRC benefit) and between than and home health care their custodial care has fallen off. They are contractually obligated to find "comparable" care elsewhere if necessary. Who knows how comparable it will be.

Here is the thread I was referring to about the closure of skilled nursing centers in CCRC's. I had forgotten it was on the Bogleheads site rather than here.

My DH and I are planning on moving to a CCRC nearby within the next 6-8 years. Our biggest concern is the high-density living since we are both very introverted.

https://www.bogleheads.org/forum/viewtopic.php?t=383920

 

[JoeWras]

When dad needed more care, we moved him from one facility to another. The independent living place where he lived tried to get us to move him to assisted there. We didn't find it adequate, so it was time to move on. Throughout the whole process from dad's intake until this moment, the director and sales people were all smiles.

When it came time to move dad, the cheerful director changed tone and went into "bad cop" mode and sternly informed me that I must live up to the terms of the contract I signed, i.e. 2 months pay. Of course, I knew this and found it in the 15 pages of contract we signed, so it wasn't a surprise. Her bad cop tone was, but I should have seen it coming.

So when I sign the 30 page contract at the CCRC, what am I signing? It really doesn't matter how many smiles they have and what they say. It only matters what they signed, escape clauses and all. Apparently the folks at that Indiana facility are finding out.

 

[Jeffman52]

We moved my FIL into an assisted living community this year. Its more apartment than nursing home which was great because he doesn't need full time nursing care. We sold his house (it was signed over to his kids 18 years ago) so no issue with the govt wiping him out if he ever does need to go to a nursing home. That money will help to pay for him to stay in assisted living. Its a good facility where we brought his furniture (that would fit) and he has his bed, recliner, small table and chairs, a TV, bathroom with sink, closet, washing machine/dryer, and a cafeteria (food is included in the monthly cost). Its 5 minutes from us so we can visit often.



The other good thing about him not having access to that money is that (at 93 years old) he is subject to being scammed and continues to want to put hundreds of dollars in the mail to... (insert scam here). If he had access to it, he would be wiped out in no time. He is not rational about it and thinks that he is winning millions of dollars and by sending this money out, they will release him money. He also falls for the SS scam regularly as well, thinking he needs to send in money so the govt doesnt stop his SS check. Of course explaining that he has been sending money out like that for the last few years and has received nothing, falls on deaf ears (not literally). Again not rational.

 

[aja8888]

I'm sure there are lots of examples why it works for people to age out in an expensive facility. And there are lots of cases where dying at home or in a child's house was the only choice. That selection depends on the availability of finances.

My parents had nothing in the way of funds to even remotely consider assisted living as a choice. Dad passed in the hospital when his liver quit at 62, Mom made it to 84 when her kidneys failed and she lived quite nicely and was able to care for herself while living with my sister for almost a decade.

My DW's ex died at home after a week from cancer and was able to live there without much help.

My 55 year old sister died in her sleep at home and was suffering from cancer. She was able to work up until a few weeks before she passed.

Me, my plan is to stay healthy, live in the fast lane, and die quickly (LOL!). I'm sure my plan can change, but at this point, I'm OK with taking care of myself.

If DW needs help beyond what I can provide, we will hire it.