Robert Willett of Raleigh, North Carolina based News & Observer, recently wrote an eye-opening article highlighting the work of researchers at the AARP Foundation who are citing social isolation as a key factor that can ultimately have dire consequences for retirees who live alone. Many lack an adequate support network, as well as the resources, ability, or will to get out of the house regularly. This is a reality that could impact millions of seniors in the coming decade and beyond.

One particular part of the article that stood out to me was a quote from Dan Blazer, a Duke university psychiatrist, who stated, “The most advantaged people can escape isolation- they go into retirement communities,” and referred to a local continuing care retirement community (CCRC) as an example.

It is an unfortunate reality that many retirees on the lower end of the financial spectrum have fewer choices currently available for avoiding the impact of isolation- such as moving to a retirement community. This is an issue that clearly requires significant attention. Yet, I suspect there are a number of seniors who fall in the middle to lower-middle end of the financial spectrum who may unnecessarily face the perils of social isolation because they, and perhaps their adult children, feel that a retirement community is out of reach financially when, in fact, it may not be.

I ran a few searches through our LifeSite Logics database, which only includes continuing care retirement communities, and found seven CCRCs in the state of North Carolina with entry fees of $20,000 or less for the smallest living units available within the respective communities. The average entry fee among these seven communities was approximately $16,000. For seniors who currently own a home, even in a rather modest home, the equity alone would likely cover the entry fee with money left over. Three of the seven communities also offered rental contracts, which do not require an entry fee but also may not provide residents with priority access to care.

The average monthly fee for independent living for the entry fee contracts was approximately $1,500. (It would likely be higher for a rental contract) When you consider that this fee may cover many of the expenses a person already pays for at home- such as homeowners insurance, property taxes, groceries, utilities, yard and home upkeep, and more- the difference in cost probably isn’t as drastic as first thought in many cases.

Of course, you also have to consider the cost of assisted living or skilled care if and when required but those are expenses that need to be addressed regardless of whether a person ages at home or in a retirement community. All seven of the CCRCs I cited above were Medicaid certified, which means that if a resident runs out of money paying for long-term care they can file for Medicaid support. Beyond the Medicaid safety net most of the seven communities were non-profit communities. As a general rule, non-profit CCRCs will try to keep residents in the community if they have exhausted all other financial resources.

There are many other factors to consider when determining if a retirement community is appropriate for someone, which are beyond the scope of this post. My point is simply that there may be many seniors out there today, and adult children, who are either uninformed, misinformed or have preconceived notions about retirement communities and, in particular, the costs associated with them. Through focused education the senior living and care industry has an opportunity to break the cycle of isolation for many seniors and their families.

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