Moving to a retirement residence is an important lifestyle decision requiring thoughtful planning and preparation, particularly during today’s uncertain economic climate.
Amica at Somerset House
Dededda Stemler
“There are so many different models, options and packages out there that you need to take the time and seriously see if what is being offered suits your needs and your budget,” says Laurie Johnston, a retirement life consultant who has been involved in Ontario’s retirement residence sector for the past 25 years. “The important thing is that you do your research, comparing apples to apples, and that you are getting services that are of interest to you or know whether you will pay extra charges for services you need.”
Being well-informed is key when looking at pricing for a retirement suite or apartment, agrees Susan Gerard, vice president of marketing and communications at Amica Mature Lifestyles Inc., which owns and operates retirement residences across Canada. “You need an itemized list of what your monthly fee includes. You don’t want any surprises.” All-inclusive retirement communities tend to cover meals, laundry and housekeeping and, in some cases, care services under the monthly fee. In some communities, residents pay for their accommodations and then purchase the other individual services they require.
“If you move into an à la carte environment and you don’t need medication supervision, you’re not going to have to pay for it. In some cases, residents can purchase services as they are needed,” Johnston notes. “You need to make sure how much care is available should your needs change.” But you must weigh your choices carefully. An all-inclusive price may appear to be higher; however, it may turn out to be more economical if you are in need of a range of services. “There are a great many options to suit a range of budgets, so you need to know what you are getting for your money,” Gerard says.
It’s important for seniors to evaluate all their existing living and maintenance costs, including groceries, utilities, household repairs and upkeep, property taxes and so on, to get a full profile of their current expenses versus the cost of living in a retirement community. Through this process, you might find that your current costs are similar or even more than you would pay to live in a retirement residence.
Masterpiece West Island
Christinne Muschi
Although advanced planning is the best strategy, industry experts agree that many seniors and their families do not begin to consider a move to a retirement residence until an urgent need arises. But having to make an unplanned transition can have significant impact in a soft real estate market, such as the one much of the country is now experiencing. “A high percentage of our residents are selling their primary home to move into one of our retirement communities,” Gerard says. “If selling their home is critical, the question is whether the sale of that asset will be sufficient to finance their move.”
The economic dip has led to some seniors who can’t wait for a market turnaround to come up with strategies to keep the move within their budget. “They’re losing profit on the sale of their home,” explains Gerard, “so instead of a 1,200-square-foot condo, they’re buying one that is 800 square feet.” Downsizing from your primary home to a retirement condo allows you to maintain an asset that may increase in value once the market turns around. But keep in mind that condos tend to suit seniors who can live fairly independently.
As the economic downturn impacts their available income, some residents of retirement residences are asking to downsize from a two-bedroom suite to a one-bedroom unit.
Seniors and their families might also consider whether a temporary move to a supportive retirement community might meet their needs. “At some of our residences, where space allows, people will come and stay with us for a couple of months or for the winter and pay daily, weekly or monthly,” said Cathy Hume of Revera Retirement. “The move doesn’t have to be permanent. Sometimes people are experiencing a health episode where they need support. A short-term stay can offer immediate relief to families and give them a chance to sort out issues like downsizing belongings or better preparing a house for sale,” Hume explains.
The most important advice one can give seniors and their families is not to react and make decisions based on fear of the economic environment, but instead try to get a clear picture of all their options, says Sonja Peacock, a British Columbia-based certified financial planner and professional retirement planner. “Even if it is a last-minute move, it’s best to talk to family and a caring financial adviser to create an ongoing plan that is reviewed annually,” Peacock says. “At the very least, you will have a better understanding of what you can afford.”
When the funds just aren’t there without the sale of a primary residence, Peacock points out that commercial banks or insurance firms will often advance homeowners a line of credit against the value of their property. This can provide seniors with a bridge to finance a move to a retirement residence while they are waiting for their house to sell or a more favourable time to put their property on the market. Since everyone’s needs and financial pictures are unique, Peacock stresses it is essential to seek sound professional advice and become well-informed so you know all your options and are making the most appropriate choice for your circumstances.
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