Deciding on Senior Living? 10 Things You Should Know

Happy senior woman toasting with her husband while having a meal at dining table. the scene could be at a fancy restaurant or an upscale senior living community.

(Image credit: Getty Images)

The number of Americans 85 and older is expected to nearly double by 2035, according to the U.S. Census Bureau. With age often comes the need for help with driving, medical care and daily tasks, sometimes making living alone no longer safe or practical. That’s when families consider moving to a retirement home.

“For the typical person, the thought of going to a retirement home is terrible,” says Patrick Simasko, an elder law attorney in Mount Clemens, Michigan. “In their mind, they’re going to a dump and it’s the next step to a funeral home.” But that’s not the case today.

Modern retirement communities are designed to be lively, engaging places where residents can thrive. “Senior living is evolving. It looks and feels far more vital and energetic as the Baby Boomers demand that,” says Lynne Katzmann, CEO of Juniper Communities, which runs care facilities in Colorado, Delaware, New Jersey, Pennsylvania and Texas.

From just $107.88 $24.99 for Kiplinger Personal Finance

Become a smarter, better informed investor. Subscribe from just ~~$107.88~~ $24.99, plus get up to 4 Special Issues

CLICK FOR FREE ISSUE

https://cdn.mos.cms.futurecdn.net/flexiimages/y99mlvgqmn1763972420.png

Sign up for Kiplinger’s Free Newsletters

Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.

Profit and prosper with the best of expert advice - straight to your e-mail.

Retirement homes also provide community and many ways to socialize with others. That can be just as valuable for retirees currently living alone at home, even if they are able to take care of themselves. “It opens a whole other chapter of life. A lot of seniors say ‘I regret not moving earlier,’” says Jonathan Rosenberg, owner of Twin Cities Care, an elder care referral agency in Minneapolis.

With that in mind, here’s what to know about retirement homes, including your options.

1. Retirement homes have come a long way in quality

Going back a few decades, there wasn’t much in terms of selection for retirement homes. “Back then, you could go to a skilled nursing facility or to a place in Florida, and that was it,” says Katzmann.

Today’s retirement homes nationwide are much more varied and consumer-oriented. Many provide apartments where you’re mostly living on your own, but with extra support and amenities. “Some of these places are just beautiful. They have movie theatres, libraries, gyms, happy hours and delicious food,” says Simasko.

There are various types of retirement homes, depending on the level of care and support you require.

2. Indedependent living doesn't include care

Independent living communities are designed for older adults (often 55+) who can live on their own but want a simpler, more social lifestyle.

These retirement communities provide housing, plus extras such as group activities, on-site dining, transportation and housekeeping. They do not offer medical care or assistance with daily tasks. Residents must be able to take care of themselves.

3. Assisted living offers on-site care when you need it

At an assisted living facility, you have your own apartment or home, but nursing staff and caregivers are readily available. “Assisted living makes sense for someone who needs help with some activities of daily living but not constant nursing care,” says Rosenberg from the elder care referral agency.

Common services include assistance with medications, walking and mobility, bathing and dressing. Support services can be scheduled on a daily or weekly basis or provided on demand. Medical care is also readily available in the event of an emergency. Residents wear a call button on a necklace or bracelet to summon help.

4. Specialized care facilities and nursing homes provide 24/7 support

Skilled nursing facilities serve people with serious physical or mental conditions who can no longer care for themselves, offering continuous medical oversight and assistance with all daily needs.

Specialized care facilities do the same but target specific issues. For example, a memory care facility is for someone with conditions such as Alzheimer’s or dementia. Doors are locked so residents can’t get out and hurt themselves, while the facility offers programs and therapies designed for these conditions.

A specialized facility for people with severe mobility issues is built with a focus on accessibility to enable those people to move around more easily.

5. Continuing care communities offer all types in one location

People often require more support over time, necessitating a change in the kind of retirement home. Moving to a different location would be one more hassle.

Continuing care retirement communities bundle everything in one location, allowing residents to transition from independent living to assisted living to specialized or skilled nursing care as needed.

Some places require moving to a different floor. Others allow you to receive all types of care in the same unit. “That setup is ideal for couples, so they can both stay in the same apartment even as they need different types of care,” says Rosenberg.

6. Costs are substantial

The cost of a retirement home depends on the type, location, size of your apartment and the level of care you require.

Independent living communities cost roughly $2,000 to $6,000 a month, typically just for rent and utilities, with meals being an additional expense, says Rosenberg. Assisted living starts at around $4,000 to $7,000 for the unit itself with additional charges when care is needed. Nursing homes cost around $10,000 per month.

If you go to a continuing care retirement community, expect to pay more per month than a retirement home with only one type of service, as you pay more for the flexibility to upgrade over time.

7. Government and insurance support is limited

Most retirement homes are private pay, meaning you are responsible for covering all expenses. There is no government support for independent living.

Medicare pays for up to 100 days in a skilled nursing facility, but only for temporary issues after a hospital stay, such as surgery, when you are expected to recover. Medicare does not cover extended stays for someone who cannot take care of themself.

Medicaid can cover nursing home care, but typically only after you have mostly exhausted all your other financial resources. In some states, Medicaid also covers the cost of services at assisted living, but not your room and board.

Health insurance also will not cover these costs. If you own a long-term care insurance policy, it will help pay for care in assisted living and a nursing home, including skilled nursing assistance with daily living tasks and therapy. Some policies also pay for laundry and housekeeping. Check your contract to see what’s covered.

8. Budget carefully to make your money last

Since Medicaid won’t pay for your room and board, you could lose your spot if you run out of money while in independent or assisted living, because Medicaid generally only applies once someone qualifies for nursing-home-level care. If you do qualify, some retirement homes will let you stay and collect payment from Medicaid, while others may move you to another facility that accepts it.

Given these risks, it’s essential to budget carefully, especially at the beginning. “Kids feel guilty and move their parents to the Taj Mahal of facilities right from the start, and then there are real problems when they eventually run out of funds,” says Simasko, the elder law attorney from Michigan.

9. Married couples should plan strategically

Married couples can also run into budget problems when one partner needs significant, ongoing care that drains their joint savings.

Advance planning can help protect the healthy spouse's assets by helping the other spouse qualify for government support sooner. For example, for one spouse to qualify for Medicaid in New York, their partner can have no more than $157,920 in assets. Anything above this limit must be spent down first. However, the asset limit does not consider a primary residence. If the couple still has a mortgage, they could put their savings towards paying it off rather than having that money go to the facility.

“That way the other spouse still has resources for their own assisted living,” says Simasko. An elder care attorney can discuss possible strategies for your situation.

10. Put in the time to find the right retirement home for you

Websites like AssistedLiving.org and SeniorLiving.org provide searchable databases where you can compare options in your area. Medicare and state agencies also provide research on nursing homes with quality ratings.

Build a list of possible candidates and visit each one. “Look around, is it clean, is it well-maintained?” asks Katzmann from Juniper Communities. Make an effort to speak with some of the residents and introduce yourself to the activity and medical directors. You should also see if you like the food. Most places will comp a meal as part of the tour.

Try to get a feel for the culture and community of each retirement home, as they are all unique. “I love to cook and travel. Another person might be an intellectual. I’d be looking for a place where others have similar interests,” says Katzmann.

Note: This item first appeared in Kiplinger Retirement Report, our popular monthly periodical that covers key concerns of affluent older Americans who are retired or preparing for retirement. Subscribe for retirement advice that’s right on the money.

David is a financial freelance writer based out of Delaware. He specializes in making investing, insurance and retirement planning understandable. He has been published in Kiplinger, Forbes and U.S. News, and also writes for clients like American Express, LendingTree and Prudential. He is currently Treasurer for the Financial Writers Society.

Before becoming a writer, David was an insurance salesman and registered representative for New York Life. During that time, he passed both the Series 6 and CFP exams. David graduated from McGill University with degrees in Economics and Finance where he was also captain of the varsity tennis team.