We recently had a discussion with clients who were contemplating where and how they would live out their remaining years. The conversation turned to the concept of “aging in place”, which means at their home, but we also discussed moving to a continuing care retirement community (a life plan community that has independent living, assisted living, and nursing care on the same property). Although in good health and fully independent, we were assisting this couple think about and prepare for their future. They like their current home and neighborhood, but don’t want to burden their loved-ones should they need additional care and/or to move to a facility.
An increasing number of Baby Boomers are facing this same dilemma. Those choosing to stay in their home do so for many reasons. Some are staying to accommodate adult children who have moved back home or to have enough room for extended visits from family and grandchildren. Others simply prefer to remain in their current neighborhoods or communities where they have strong family and social ties.
Your financial advisor should help you think through these things if you (or a parent) are planning to age in place:
- If you have a mortgage discuss the pros and cons of paying it off early (taxes, cash flow, mortgage rate, your priorities).
- Be sure to factor in ongoing property taxes (homestead exemptions) and homeowner’s insurance.
- Consider the relative costs of maintaining a larger home (utilities, cleaning, decorating, lawn care).
- Remember to budget for regular home maintenance and repairs that may include big -ticket home improvements such as a new roof or windows.
- Also, discuss how easy or difficult it may be to make accessibility upgrades should you or your spouse need them (door openings to accommodate a wheelchair, one-floor to avoid stairs or a bedroom and full bath on the main floor).
To stay or to move is a tough decision, but for many retirees, deciding when to move is an even tougher decision than deciding where to move. We strongly encourage our clients who are considering a move to do so when they’re still healthy. You don’t want to be forced into the decision to move under duress, due to a health condition or emergency. The more time you spend planning ahead, the easier and more cost-effective it will be to maintain your preferred lifestyle. Next month, we will discuss the different types of communities retirees are considering moving to, from assisted living to continuing care retirement communities, and the financial implications associated with each option.
Life’s a journey––navigate it wisely!