The purpose of this article is to inform you of the financial options, not in any way to suggest one instance/model is better than another.

The Three Financial Options in selecting a Retirement Community are:

Entrance Fee Model: Entrance fees are sometimes called equity fees, residence and care fees, or endowment fees. These fees vary regarding how much of your initial deposit may be contractually refundable. The entrance fee model is the most common model in Northern Nevada. The fee is generally for the provision of housing; the resident then pays a monthly fee for recurring services.

Equity Model: Equity model communities offer more of a traditional real estate purchase situation. At an equity model community, members own their unit. The member then pays a monthly fee for the contracted services.

Rental Model: As the senior community market has evolved, the choices regarding the financial arrangement for entry have broadened. A community may have always fallen into the rental model category, or it may have begun to offer a rental option in recent years. In a rental contract, the resident agrees to pay a monthly fee that provides for housing as well as services.

A short note about the monthly fees: Regardless of which of the options listed above is most appealing to you, it is important to be fully aware of what is included in the regular or basic monthly package of services. Communities tend to range from all-inclusive to what is termed “fee-for-service.” The package of services typically includes food, utilities, housekeeping, transportation, and (often the most expensive item) long-term care, including assisted or skilled care.

Armed with the information above, the bigger question becomes, How do you decide which contract is best for you? In consultation with those you trust, you should consider your timeframe, finances, preferences regarding flexibility, and possibly estate planning. For many, your age and the length of time you envision living in the community will also affect your decision.