Saving for the future is always a challenge. How do you balance what you need today with what you could need in the future? You don’t want to limit your possibilities, nor do you want to sacrifice what you want to do now for a tomorrow that could be different than one you’d planned for all this time. What if there was a way of making your retirement savings last, while providing you with a more active and engaging present?

One senior living option many older adults are considering as an important part of their financial planning is a Life Plan Community (also known as a Continuing Care Retirement Community or CCRC) with Life Care.

Life Care (also known as a Type A) is a type of senior living contract that can help you plan for the costs of long-term care at more predictable monthly rates while providing you with a more engaging and active lifestyle. It’s important to note that Life Care communities come with an entrance fee. While other communities don’t have an entrance fee,  they also don’t offer the benefits of Life Care. So, in the long run, which option will help you save money?

Entry Fee vs No Entry Fee

Is a community that doesn’t charge an entrance fee a less expensive option? Not necessarily. And the difference could come down to the need for a higher level of care. As you determine which option makes the most financial sense for you and your family, here are some things to consider.

Lifetime costs: The differences in costs between one-time entry fee and non-entry fee communities may not be as high as they appear at first. Especially when evaluated over a longer term. That’s why it’s important to also consider:

• What’s the cost of higher levels of care in the community (if provided)?
• If a continuum of care isn’t provided, would you have to move if you needed care in the future?
• Is any portion of the entrance fee refundable?
• How does the monthly fee at each community type compare, and what are the services and amenities each one offers?

Breaking even: According to the U.S. Department of Health and Human Services, 70% of seniors 65 and over will need some form of long-term care in their lifetime for an average of three years. That long-term care could be assisted living, memory care or skilled nursing. In 2023, a study by Genworth — a company dedicated to helping seniors and their families navigate the cost of health care — found the market rates for higher levels of care in the Oxnard area were:

• Home health aide — $6,864/month (assumes 44 hours a week) or $82,368/year
• Assisted living — $5,800/month or $69,600/year.
• Skilled nursing with a private room — $15,391/month or $184,692/year

With numbers like that, it doesn’t take long for the costs of care to add up and to see the benefits of one-time senior living entrance fees.

Care access: At Wisteria at Warner Center, you get priority access to the adjacent health center for assisted living, memory care and long-term care in a skilled nursing center, if ever needed. Plus, our services are provided at predictable monthly rates, so you won’t have to worry about unexpected charges.

Value of Life Care

Life Care has profound advantages and guarantees, but it can seem complex. Here’s a high-level explanation of how Life Care works:

• Savings: You’ll see substantial savings compared to the average cost of private assisted living, memory care and skilled nursing.
• Asset preservation: By paying lower prices for higher levels of care, you’re preserving your assets over your lifetime.
• Tax savings: A portion of your entrance fee and monthly fee could be tax-deductible as a prepaid health cost. As with all financial decisions, check with your financial advisor about this.
• Peace of mind: Your family members won’t have to worry about what your next move will be if your physical or mental health changes. By pre-planning your future now, you’re maintaining control over those decisions.

Predictability in An Unpredictable World

With Life Care, not only will you know in advance what your expenses will be month to month, but if you or your spouse needs a higher level of care, you’ll still pay about the same. The only added expense will be to cover the cost of additional meals.

Start Planning for a More Interesting Future Today

Even if you’re not ready to move today, joining our waitlist by making the $1,000 deposit is a great place to start. Wisteria at Warner Center offers secure and simple retirement planning with the Type A contract. If you have questions about contract types or to learn more about our maintenance-free single-story homes and senior apartments, give us a call or contact us here.