Continuing Care Retirement Communities vs. Active Adult Communities

If you have just begun exploring your retirement options, and have concentrated your search on Active Adult and 55+ Communities throughout the country in areas close to your favorite vacation spot or in a location close to your current residence, I’d like you to consider another option!

Often overlooked, Continuing Care Retirement Communities or CCRC’s as they are called, offer young ‘sixty-somethings’ the benefits of independent living, along with health centers, pools, performing arts centers, dining options, educational opportunities, the ability to meet new folks with shared interests, weekly and monthly housekeeping and inside and outside maintenance included in the monthly fee structure. The ONE benefit they offer over-and-above Active Adult Communities is an ‘invisible’ safety net that pops into place, should you find yourself in need of medical care, long before you thought the need would ever arise. (Who among us hasn’t heard of the collapse of a colleague or friend, in their early 60’s or 70’s — the victim of a health crisis that came “totally out of the blue.”?)

Now I know some of you are saying to yourselves, “…..a Continuing Care Community?…..I don’t need any CARE, and I’m certainly NOT looking to spend my time with the ‘walker and motorized scooter set’!” OK, that’s quite all right! The majority of the population in CCRC’s is INDEPENDENT! Able-bodied, mentally alert, active, vigorous people who have tired of the hassle of house maintenance, daily meal preparation, and housekeeping chores, who want to devote more time to learning new skills, honing a life-long hobby to a new level, volunteering more hours, or even starting a new business, as they redefine how they will spend each day. Only a small percentage of the residents in any CCRC live in Assisted Living or Skilled Nursing Care residences…..and they are there by choice, because they carefully considered retiring to a community that could offer a full continuum of care, when and it care was needed.

No wild dash to locate an Personal Care or Skilled Nursing Care facility to provide health care, after the fact. No disappointment in the level of care provided by the lone provider who had the room when the sudden need arose, and no need to put your residence on the market, pack up your belongings and move at a time in your life when you least can afford the mental and physical trauma! Residents at Continuing Care Retirement Communities are the PROACTIVE members of society; choosing to SELECT the quality of their futures rather than leaving the choice up to the ‘luck of the drawl,’ or the ‘whoever-has-room-for-me when-I-need-the-care’ philosophy. They may enjoy gambling in a game of five-card, ‘Texas Hold ‘em’ or a trip to their favorite casino from time to time, BUT they are NOT willing to gamble on their future.

These proactive folks also know that in many Continuing Care Retirement Community contracts there is a “wellness” clause that requires you medically document your health and your ability to live without assistance, prior to entry. This is not to say that you cannot enter with certain pre-existing conditions, however, you cannot wait until you’ve been diagnosed with heart disease or Alzheimer before looking into most CCRC’s. I you wait until illness has taken its toll, you will more than likely be looking into Assisted Living or Dementia Care. Many, many CCRC’s do not admit non-residents directly into their assisted living and skilled nursing residences, so if you decide to postpone decision making, and wait until you need ‘the care,’ you are right back in the ‘reactive mode’ or “Who has the room when I need it, and do they match my requirements both financially and quality-wise”?

One reason folks often avoid considering Continuing Care Retirement Communities in favor of Active Adult or 55+ Communities, is the issue of equity. Rarely, if ever, do you own your residence in a CCRC. What you will receive, in lieu of equity growth, however, is a VERY healthy tax deduction in the form of pre-paid health care deduction! If you are a resident at a CCRC with an “A” type (all inclusive) contract this deduction, in many cases, offsets the equity you might be earning on an owned residence in an Active Adult Community. And, unlike earned equity, will never require you to pay a fee to a realtor or association board to cash out your earnings. Each year, like clockwork, the IRS will assign a pre-paid health care deduction to residents in your community, and each year, you can use that deduction to help maintain your principal.

“A-type” contracts also allow you to cancel any Long Term Health Care Insurance policies you might have been carrying prior to your entry into the community. All inclusive contracts clearly define the comprehensive care that will be provided throughout your lifetime, and paying for additional long term health care is not necessary. Be more cautious in canceling this insurance, however, if your community is covered by a “B-Type” or “C-Type” contract. C-type’s translate into a “fee-for-services” contract, and B-type’s are a “combination” — some services included, and some not.

With an all inclusive, A-Type contract, you can easily weigh and balance the cost of moving into a CCRC versus the cost of moving to an Active Adult Community. Just be sure you are comparing apples to apples. For instance, the CCRC you are looking into includes, all outside maintenance, all lawn services, snow removal, taxes, weekly housekeeping, heat, water, sewage, electric, gas, local phone, cable TV, a flexible meal plan, free use of the indoor swimming pool and fitness center, free performing arts programs, movies, on-site library, bank, beauty salon and barber shop, pharmacy, gift store, physical therapy (should you need it) and access to college level courses at a reduced fee, plus pre-paid health care. The Active Adult Community includes outside maintenance, lawn service and snow removal, use of the community clubhouse and perhaps free use of the community pool and fitness center. (Not always included in your monthly fees, some communities charge extra to use the wellness/fitness center, golf course, swimming pool and gym.

So don’t just look at the monthly fee structures for each community and rule one or the other out!

Finally there’s the ‘age’ criterion. You believe that you are “just too young” to enter a traditional retirement community, and want to live with your peers who are in their 50’s and 60’s. Did you know that the majority of people looking at 55+ and Active Adult communities are not 55? Statistics tell us that the average age of someone living in an active adult community is 75, not 55, as the name implies…so what are you really doing when you move to an age restrictive community? You are predestining yourself to another move, somewhere in your early 80’s or later if you’re lucky, to a community which offers a continuum of care to better serve your increasing needs. If you’re like most of us, you find moving to be a very stressful event; now imagine you’re 83 or 85 or even 89, in failing health, and although you certainly don’t need skilled nursing care, you feel you can no longer safely stay in your Active Adult residence. Now what do you do? You face FINDING a suitable community to meet your new, more complex needs, FINDING a buyer for your Active Adult community property, FINDING a mover to pack up your belongings, FINDING an organization to get rid of those things you will not be taking along on the move, and FINDING the energy to integrate yourself into a community of new acquaintances at the other end of your move…..all this when you’re obviously not as vigorous as you were, or you wouldn’t be moving in the first place!

So, as I said to you in the beginning of this article, if you’ve just begun exploring your retirement options, consider also, the Active Adult Retirement Community that lies within the Continuing Care Retirement Community nomenclature. You’ll find everything you’re looking for and more………….you may even find that you’ve found some ‘peace’ of mind….and you can’t put a price tag on that.