Looking into retirement communities? While doing so, it’s important to note that there are entrance fees. Most retirement communities charge an entrance fee upfront. If you’re unsure what they are and how it works, here is a guide to senior living entrance fees.
What Is an Entrance Fee?
The majority of CCRCs and Life Plan Communities charge an upfront entrance fee, often known as a buy-in at some communities. Entrance fees for retirement communities frequently mirror local property values. The number and size of residents of the retirement community you select will determine your entrance charge. Along with paying for community operating costs, the entrance fee also guarantees priority access to higher levels of care and prepays some of the costs associated with providing access to ongoing care for life.
Is the Entrance Fee Refundable?
Entrance fees for retirement communities are almost usually refundable, although only to a certain extent. The sort of contract you sign will determine how much of your entrance charge will be returned to you or your estate. Regardless of how long you stay in the community, a “return of capital” plan typically recovers 50%, 75%, or even 100% of the admission cost. Contrarily, a “declining balance” contract amortizes the entry charge over the first couple of years, after which you won’t get back any of the entry fees.
What Is a Monthly Fee?
The community’s amenities and services are included in the monthly cost. Your monthly payment is determined by the size, number, and variety of amenities and services that are offered in your community.
The monthly price at a Life Plan Community or CCRC can compare favorably when you factor in all of the expenses of living at home, including property taxes, home security, utility, maintenance and repairs, and food.
Services that are typically included:
- 24/7 security and emergency response system
- Scheduled transportation
Amenities that are typically included:
- Access to the fitness center and pool
- Calendar of events and activities
- Dining venues with chef-prepared meals
- Use of all common spaces
The A, B, and Cs of Community Contracts
CCRCs and Life Plan Communities often provide one of four types of contracts: Type A, Type B, Type C, and rentals. Types A, B, and C all demand a price to enter.
- Type A: Lifecare contract with the highest entrance fee. The monthly fee will not significantly increase for higher levels of care.
- Type B: Modified plan with less expensive entrance fee than Type A. It offers a set number of free days or consistently low prices for medical services.
- Type C: Fee-for-service contract with the lowest entrance fee. Health services at full market.
- Rental: No entrance fee, possible nominal community fee. Higher monthly fees – may or may not get access to health care services. If offered, available at market rates.
Enjoy Senior Living at The Trace
Discover exceptional senior living when you move into our Assisted Living community! With our resort-style amenities and exclusive senior living programs, we guarantee you’ll have a comfortable and fruitful stay. To learn more about our senior living options, contact us today.