Choosing the Right Retirement Community: What You Need to Know

Retirement planning involves many tough choices, especially when it comes to where to live. Many seniors want to stay in their homes but may need help with daily tasks or medical care. Some move in with family, but this isn't always possible or practical.

What is a CCRC?

A continuing care retirement community (CCRC), also known as a life plan community, offers a range of care options as seniors age. These communities provide:

Independent living
Assisted living
Nursing care
Memory care

They also offer amenities like fitness centers and social activities.

Benefits of a CCRC

Research shows that living in a CCRC can lead to:

Better health
Greater happiness
Convenience for couples, as they can stay close even if one needs more care

Financial Considerations

Moving to a CCRC is a big financial decision. It might be the last time you choose where to live. So, it's important to think carefully about the costs and benefits.

Costs of a CCRC

Entrance fees average around $400,000, but can range from $100,000 to over $1 million.
Monthly fees average about $4,200 for independent living.
Fees usually increase by about 4% each year to keep up with inflation.

Types of CCRC Contracts

There are three types of CCRC contracts:

Type A contracts: Highest fees but cover all healthcare costs.
Type B contracts: Lower fees but higher costs if more care is needed.
Type C contracts: Lowest fees but can become very expensive if higher-level care is required.

Tax Considerations

Part of the entrance fee and monthly fees may be tax-deductible.
Only if they exceed 7.5% of your adjusted gross income.

Choosing the Right CCRC

Choosing the right CCRC is crucial. It should:

Meet your needs
Be financially stable

The National Continuing Care Residents Association offers resources to help with this decision.