| Maybe it's the thought of mowing the grass, | | | | Plus, her home was built 40 years ago, and wasn't |
| shoveling the snow, or the kitchen faucet that needs | | | | particularly "senior" friendly! Doorways were narrow, |
| to be repaired. The multitude of responsibilities and | | | | the laundry room was in the basement, and the |
| maintenance involved in keeping up your current | | | | stairs to that area were narrow. She didn't want to |
| home may make the move to an Independent Living | | | | risk falling. |
| Community look very attractive. But is it affordable? | | | | Jane didn't think she could afford to live in an |
| This is a question we hear a lot. In most communities | | | | Independent Retirement Community, but after |
| utilities, maintenance, some laundry, and some meals | | | | visiting her friend Marge several times, she knew it |
| are included in the fee. Use the monthly fee to | | | | was a vibrant and active place that really catered to |
| compare to costs of staying in your current living | | | | her lifestyle. |
| situation. Remember to include utilities, taxes, | | | | Jane also wanted to leave an inheritance to her |
| insurance, fees paid for the yard work, and | | | | children, but didn't have a large 401K or IRA to leave |
| maintenance of your home. There should be a staff | | | | behind, therefore, all she had was the value of her |
| member available, at the facility you are considering, | | | | home. She was worried that if she sold her home |
| who can go over financial information with you. | | | | and moved to an Independent Retirement |
| If you are considering moving into a Continuum of | | | | Community, she would not be able to leave an |
| Care Retirement Community as opposed to a stand | | | | inheritance. Her children on the other hand, were not |
| alone Independent Retirement Community, there | | | | worried about receiving an inheritance, they just |
| may be entrance fees or life care contracts to | | | | wanted Jane to live the life that made her happy, |
| consider. According to the Continuing Care | | | | safe, and comfortable. |
| Accreditation Commission, there are three basic | | | | After sitting down with the staff at her local |
| types of contract that a resident enters into with a | | | | Independent Retirement Community, she understood |
| CCRC: extensive, modified, and fee-for-service. An | | | | that not only could she afford to live there, but she |
| extensive contract offers unlimited long-term nursing | | | | would also be able to leave a LARGER inheritance to |
| care for little or no substantial increase in your usual | | | | her children than she ever thought possible. |
| monthly payments. Entrance fees and monthly costs | | | | Here's how it worked for Jane: |
| under extensive contracts are typically higher than | | | | Jane's Current Assets:o $100,000 - total in checking |
| those under modified or fee-for-service contracts. | | | | savings, CDs, stocks, bonds, mutual funds, IRA and |
| That entrance fee may be refundable over time, | | | | annuities (rainy day money)o $150,000 - value of her |
| partially refundable or nonrefundable. You may acquire | | | | homeo $1400/ month Social Security Income and |
| ownership of your residence within the community, | | | | Pension |
| or you may be provide housing on a rental basis. | | | | Cost to Live in the Independent Retirement |
| A modified continuing care contract includes a | | | | Community:o $2300/ month, no entrance fee, just |
| specified amount of long-term nursing care beyond | | | | monthly rento -$1400/month incomeo = shortfall of |
| which you are responsible for payment. Once such | | | | $900/month for Jane |
| specified amount of care is reached, the resident | | | | Jane's Solution:o Jane sold her home for $150,000 and |
| may continue to receive care, but most pay the | | | | put the proceeds into a lifetime annuity that |
| facility's daily or monthly nursing rate. | | | | generated an income of $1,204 per month. (which |
| A fee-for-service continuing care contract covers the | | | | covers her shortfall of $900 and leaves $300 for |
| cost of your housing, residential services, and | | | | other needs)o Jane took her remaining assets (rainy |
| amenities. You pay full daily rates for all long-term | | | | day money) of $100,000 and left $25,000 in |
| nursing care required. Entrance and monthly fees are | | | | checking, but purchased a single premium life |
| lower under this type of contract because residents | | | | insurance policy for $75,000.o That single premium life |
| are responsible for all long-term nursing and health | | | | insurance policy is worth $250,000 TAX FREE to her |
| care costs. | | | | heirs upon her death.o Plus if she passed away within |
| There are many options available under the general | | | | 10 years, her heirs could also possibly receive the |
| term "CCRC". Your best course of action is to visit | | | | remaining lifetime annuity payout.o Remember this is |
| several communities and to decide which community | | | | simply an example and not a guarantee of results. |
| offers the best combination of services, amenities | | | | Everyone needs to have their own person financial |
| and contract options for your or your loved one's | | | | analysis completed. |
| particular needs and desires. | | | | Jane can now move into her Independent Retirement |
| Let's look at an example to help illustrate how even | | | | Community and live a safe, stress free life. Her |
| someone who didn't THINK they could afford an | | | | children will receive the inheritance she always |
| Independent Retirement Community, really can! | | | | wanted them to have. Can you afford to live in an |
| Jane is a healthy 70 year old who wanted to enjoy | | | | Independent Retirement Community? Chances are |
| the rest of her retirement years without the hassle | | | | that with the right financial planning, you can live the |
| of home maintenance, yard work, and home repairs. | | | | retirement you always dreamed of. |