Residing in a senior living community can be less expensive than aging in place in a traditional home when all costs are considered, according to a new analysis.
Most prospective residents and their families don’t calculate costs accurately, however, Jerry Doctrow, a retired market analyst, stock analyst and investment banker specializing in senior housing and care and healthcare real estate, wrote in a recent post on his Robust Retirement blog.
“Most seniors and their families see the monthly cost of a senior housing facility as much higher than the monthly cost of living at home with family care, or even with part-time or full-time home healthcare,” he said. “But the math that most seniors and families use to make this comparison assumes no implied cost for occupying a home without a mortgage, much less paid care than is provided in a seniors housing facility and places no value on the companionship and social interaction that a seniors housing community can provide.”
Using data from the National Investment Center for Seniors Housing & Care, A Place for Mom and other sources, Doctrow said he conservatively estimated that aging in place at home can cost an older adult with a $150,000 home almost 90% of the average cost of an independent living community, and that’s before the cost of any home healthcare services is factored in.
“And in the independent living facility the senior is getting much more interaction with other people, much more socialization and mental stimulation than most seniors get when living at home alone,” he said.
When a “modest” amount of healthcare services is factored in, the cost of living in that same home “easily exceeds” the cost of independent living and approaches 90% of the cost of assisted living, Doctrow said.
For an older adult living in a $500,000 condominium, he said, aging in place there can cost almost twice as much as residing in independent living and 36% more than living in an assisted living community.
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