3/11/2011 2:57 PM ET|
3 new retirement living options
The big and restless baby boom generation is reshaping living arrangements as its members begin to step into retirement. Is one of these approaches right for you?
They helped change the political landscape and American culture, and it's clear baby boomers will change what life in retirement will look like. And with their sheer numbers -- 78 million -- they may also shift the landscape of where retirees live, too.
The first explosion of new retirement community options over the last two decades included some 1,900 continuing-care retirement communities (CCRC). But experts say that as the first group of boomers reaches retirement age this year, expect to see new retirement living options -- and twists on old options that better cater to boomer desires to stay educated, have easy access to care and remain independent.
Already, there's growing evidence of this trend. Case in point: The first four senior co-housing communities, a type of collaborative housing for older Americans (akin to a New York City-style co-op, but with homes instead of apartments) have been built in the U.S. in the last few years, and two more are in development, says Craig Ragland, the executive director of the Cohousing Association of the United States.
Furthermore, 45 to 50 university-based retirement communities -- essentially continuing-care facilities linked to, and sometimes adjacent to, college campuses -- are in the planning or development stage, joining the 25 or so that have opened in the last decade, according to Andrew Carle, the founding director of the senior housing administration program at George Mason University.
And just in the last five to 10 years, about 10 continuing-care facilities have begun to offer a program that brings CCRC-style services into the homes of older people. And lately, there has been a "strong interest from CCRCs" around the country to offer such programs, too, says Steve Maag, the director for assisted living and continuing care at the American Association of Homes & Services for the Aging.
These options align with research on boomers. More than a quarter of affluent baby boomers plan to pursue continuing education when they retire, according to a recent Merrill Lynch Affluent Insights Quarterly survey. More than 80% of people older than 45 want to stay in their homes even if they need assistance from professionals or even just from other people like them, according to an AARP study.
Here are three developments in retirement living poised for growth now:
When you think of co-housing, you probably think of a group of people sharing one house, a la the Golden Girls. But the new senior co-housing communities are clusters of about 20 to 60 single-family houses gathered near a central home or building. Each person owns a home, but they are also contractually obligated to pay monthly dues for a house all members share -- at which the entire community may have, say, weekly meals together -- as well as the common land and shared amenities or services, like landscaping or even a nurse or caregiver who comes regularly. Community members meet, usually monthly, to decide how to spend the monthly dues.
The appeal: You get to know your neighbors well and have access to community amenities, but still have privacy, says Joani Blank, a spokeswoman for the co-housing association. And these co-housing developments are usually less expensive than continuing care facilities. ElderGrace, a senior co-housing community in Santa Fe, N.M., has 28 one- or two-bedroom homes that cost from $193,000 to $230,000, and monthly fees at ElderGrace run from $122 to $151.
Drawbacks: The decision-making process among community members -- who, for example, may be trying to decide whether to have a cook or nurse visit daily or just a few times a week -- can take weeks, because all members usually have a say. And co-housing communities don't offer 24/7 on-site health care.
University-based retirement communities
It used to be that developers would open continuing-care facilities where the main draw was, say, a beach or golf course, but an increasing number of retirement communities feature a university as the draw. A university-based retirement community, or UBRC, is located within a mile of a university with which it forms close ties.
The appeal: Most UBRCs offer health care at every level, as well as programs that give seniors access to college classes and events while also bringing students into the retirement community for things like internships, says Carle.
In addition, they carry the benefits of regular CCRCs, including lifelong health care, continuing education and plentiful opportunities for social interaction. But this doesn't come cheap.
Drawbacks: The cost varies greatly depending on location and amenities. A one-time entry fee, which residents pay before they can move into the community, is similar to a CCRC and usually runs from $160,000 to $600,000, with additional monthly fees of $2,000 to $7,000.
Despite the cost, these communities are popular with affluent retirees, says Carle, and that trend is expected to continue. The Village at Penn State, which opened in 2003 with 60 residents, now has 200 residents and hopes to add more apartments and health care facilities, says Jill Lillie, a spokesperson for the community.
CCRCs without walls
It used to be that if you wanted to take advantage of the services and amenities, like health care and social activities, of a continuing-care community, you'd have to live there. But increasingly, CCRCs are both bringing services to you and bringing you to them.
The appeal: These so-called "CCRCs without walls" offer health care and home maintenance in your home, while also transporting you to concerts or other social activities, says Sandra Timmermann, the executive director of the MetLife Mature Market Institute.
Drawbacks: Such services don't come cheap. Longwood at Home, a "CCRC without walls" in Pennsylvania, charges from $33,342 to $57,649 to enroll in the program and $545 per month after that for three years of home care. This cost includes transportation coordination for social events and a home inspection to make sure a participant's home is equipped for his or her needs.
Some of these programs, like the one offered by Eskaton, which has retirement communities in Northern California, follow a slightly different model. People pay a monthly "concierge" fee of $75 to $95 for the Eskaton staff to arrange transportation and activities for them; if the person wants health care, Eskaton coordinates access to certain services, but the participant has to pay for the care.
Experts caution that the "without walls" model doesn't work for people who need much more care. Even a home that has age-in-place modifications still might not be ideal for someone if they get sick or have more trouble moving around.
This article was reported by Catey Hill for SmartMoney.
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