Crunch the Numbers: Aging at Home vs. Moving to a CCRC

While aging at home continue to be the preference for the majority of older adults, residents of continuing care retirement communities (CCRCs or life plan communitis) cite access to a full continuum of care services as a main motivator for making a move. In fact, according to number consumer surveys done by myLifeSite, access to care is the number one reason that people choose a CCRC over other senior living options, including staying in the home. .

However, there also are factors that are holding people back from making a decision about a CCRC or causing them to delay their move to one. Tops on that list is that prospective residents simply don’t think they are old enough to move to a CCRC yet (46.6 percent of respondents). But second on the list of things that are holding people back is concerns about the long-term affordability of living in a CCRC (41.9 percent of respondents).

>> Related: What is a “Continuum of Care”?

Is aging at home really cheaper?

I often hear people say that, while they would like to move to a CCRC, they believe staying in their home will be less expensive on a month-to-month basis. But is this actually the case? Maybe, maybe not.

The first thing to consider is your current home’s mortgage or rent, which is most people’s biggest monthly expense. Of course, many seniors are living in a home that has already been paid off. In this case, the equity is a common source of funding for a CCRC entry fee as well as potentially the monthly fees charged by a CCRC.

Utilities are another considerable expense for those who live on their own. The cost for your home’s power, water, phone, cable, internet, and other utilities can add up pretty fast. When living in a CCRC or other retirement community, these costs may be rolled into your monthly fee. You will want to ask this question when visiting CCRCs to verify.

Homeowners insurance and property taxes also can be quite expensive for homeowners, especially in high-tax states. Again, you will want to check with community you are considering, but both of these expenses may be reduced if not eliminated at a CCRC.

Other miscellaneous costs that come with owning a home like trash removal, snow removal, HOA fees, lawn and landscaping services, housekeeping services, gym memberships, and most home repair costs will also likely be included in the monthly fee for the majority of CCRCs.

As for your monthly food expense—almost all CCRCs will include at least one meal per day as part of the monthly fee, but meal plans are becoming more flexible and the options can vary from one community to the next. Also, keep in mind that there will likely be an additional cost for meals if a CCRC resident is living in the healthcare center.

>> Related: “…but I love my home”: Is Staying in Your House the Right Move?

The biggest difference in costs

When calculating the cost of moving to a CCRC versus aging in the home, perhaps the number one cost to consider is care services. Generally speaking, there are two options for in-home care: either hire someone to provide the services you need, or have an unpaid loved one perform those duties.

The Genworth 2015 Annual Cost of Care Study reveals that the 2015 median hourly cost for homemaker or home health aide services hired from a home care agency is $19.50 and $20, respectively. In-home skilled nursing care (usually from an RN) can ranges from $13-30 per hour.

So, for just 20 hours of in-home care per week (part-time care), the cost can range from around $1,600 to $2,400 each month. That’s a hefty tab, but the cost of having an unpaid loved one serve as a caregiver can be even greater.

According to Caregiving in the U.S. in 2015, a joint research study between the National Alliance for Caregiving and AARP, in the prior 12 months, approximately 34.2 million Americans have provided unpaid care to a loved one age 50 or older. And studies from the National Alliance for Caregiving revealed that, over their lifetime, the average unpaid family caregiver loses approximately $300,000 in wages and benefits.

In addition to these financial loses, there are other well-documented non-monetary costs often experienced by these unpaid family caregivers such as higher stress, health issues, and time away from other family members and friends.

>> Related: The Unexpected Costs of Caring for an Aging Parent

So, staying in your home, with the long-term assistance of a loved one, may or may not save you money as compared to moving to a CCRC, but people often don’t realize that those costs actually get transferred to the next generation in the form of lost wages and benefits, as well as health impacts.