Baby boomers are doing it one more time - changing the landscape of society. As the 77 million boomers move into retirement, it's no longer your grandfathers' retirement community. Today's seniors are more diversified and more active. They continue to be active both physically and mentally.
Senior communities are being forced to move away from simply keeping older people occupied to creating life enrichment activities that boomers are demanding. And this has to be done in an economical manner because the average boomer is about $500,000 short for the life style that they want to live. Because of the monetary short fall, more and more seniors aren't completely retiring. Instead, they are moving into a semi-retirement lifestyle. On average, seniors working from home earn between $9 to $30 per hour. The bottom line is that senior housing facilities are gravitating towards accommodating part time working seniors. Another change is offering lifetime education and self-improvement services.
While there are stereotypes that older workers are not tech savvy, studies show that many older workers have kept current with technology. Beyond that, these studies show that older workers can still out perform younger workers based on better skills involving organization, sense of responsibility, cooperation with colleagues, and more empathy towards clients. There will be an on going demand for the work services of our aging population.
The old retirement home and nursing home concepts are fading into the past. The new concept for retirement housing is becoming the Continuing Care Retirement Communities (CCRC). These are facilities designed around allowing the elderly to progress from an active lifestyle to an assisted living lifestyle, to a full nursing home atmosphere without having to relocate in their later years.
These communities are being designed so that seniors can continue living independently and progress into assisted living as their needs change. Eventually they can move into skilled nursing care accommodations when required. What today's seniors are looking for are senior housing options that include independence, choice, and social networking while at the same time remaining in the same community as their health dictates and they eventually require more care.
The evolution to the CCRC model is partly due to baby boomer not wanting to lose their freedom as long as they are mentally and physically able to continue taking care of themselves. These communities offer a combination of single-family housing, condominiums, and rental apartments. Often, newly retired or semi-retired people first move into a smaller single family home and take care of all of their own needs while still having the security of on-campus assistance if needed.
As time and requirements change, they move into easier to maintain housing arrangements providing needed services. The costs of these arrangements come in three broad contract terms. One is a fully paid lifetime services contract that often costs a million or more. Another is a progressive plan when the costs increase as more services are needed. These are packaged plans that often pay for services not immediately needed but available in the future. The third is a cost-for-service plan that pays for only the services needed at the time. This can include a cost for medicine maintenance that costs for each medication the person is taking. For most people, there is no ironclad way of determining the most cost effective plan unless you know with reasonable certainty how long you will live in retirement and what future services will be needed.
Whether you are a baby boomer entering your retirement years, the adult child of a baby boomer looking to assist them, or an investor interested in the retirement housing market, keep your eye on the market the 77 million baby boomers are just now beginning to redefine.
Please leave a comment if this article was helpful or if you have a question.
Author bio: Brian Kline has been investing in real estate for more than 30 years and writing about real estate investing for seven years. He also draws upon 25 plus years of business experience including 12 years as a manager at Boeing Aircraft Company. Brian currently lives at Lake Cushman, Washington. A vacation destination, a few short miles from a national forest in the Olympic Mountains with the Pacific Ocean a couple of miles in the opposite direction.
Insightful article. Your thoughts, like those of many others, look at the move from traditional single-family home living to senior living. I will let you know about an alternative for the roughly 10 to 30 years between these two extremes. Since 1986, Epcon Communities has been providing single-family homes for active adults. They are association maintained, so no raking, mowing or shoveling, but are also detached like a traditional home. Many people are not aware of such options, and I invite you to learn more about our product and our communities. It may make for an interesting article in the future as to viable alternatives for the people that want to lessen their house burdens but are still young in years and spirit and are looking to enjoy themselves along the way. (FYI - our communities are located in existing metro areas, . They are not uproot-your-life communities in far off locales. Our homebuyers typically are only moving a few miles, not a few states.)
Thank you. Very helpful and useful information. I'll be writing on this topic again in the future.