Retirement Village living - four things to consider.

As people age and consider their next stage in life, many consider moving into Retirement Villages. Retirement Village living is a lifestyle choice, and one which suits many people - socially, financially, and medically.

If you are considering a Retirement Village as a lifestyle choice, you’ll be required to enter into an Occupation Right Agreement. When you enter into an Occupation Right Agreement, you pay an “entry payment” which is the cost for you to use the property and facilities in the Retirement Village, as well as weekly or monthly fees which contribute to the costs of running the Retirement Village.

Here are four important things to look at when considering a Retirement Village:

1. Ongoing Charges:

   One thing to look out for are ongoing fees. Some Villages offer a “fixed for life” fee which does not change during your stay in the Village. Other Retirement Villages tie their weekly fee to superannuation or Consumer Price Index adjustments, and others increase their fees yearly on budget projections. Make sure you are aware of ongoing costs and how these are charged.

2. Deferred Management Fee

   As well as the ongoing charges, most Retirement Villages charge a “Deferred Management Fee” - this is the premium which is charged against your entry payment. When you leave the Retirement Village you will usually receive your full entry payment back, less the amount of the accrued Deferred Management Fee. Most commonly the Village will have a cap on the maximum percentage of the entry payment they can charge which is limited to a certain period of time. You should check you are happy with the maximum percentage, and the time over which that accrues.

3. Transfer Terms

   Not all Retirement Villages offer a higher level of care (such as rest home, dementia or hospital care) – you should make sure you are aware of what services each Retirement Village offers before you go in, so you don’t need to move at a time when you are most vulnerable. You also need to be aware that when you leave the first Village to move into an alternative, there is no obligation to return your entry payment (less the Deferred Management Fee) straight away – the refund may not be paid until the Retirement Village finds a new resident for your property.

4. Repairs, Consumables and Maintenance of Chattels

   Make sure you understand who is responsible for maintenance, repair, and replacement of chattels. Some Retirement Villages require you to replace consumable items (e.g. lightbulbs, lightshades, heat pump filters, etc) and the Retirement Village takes care of the maintenance and repair of the item. However, other Retirement Villages require the resident to take full responsibility for repair and maintenance costs of chattels.

Summary

There is a lot to consider when thinking about a Retirement Village and each Retirement Village differs. Talk to us today about whether moving to a Retirement Village is right for you.