30 Mar Seniors in WNC Have Choices: How Legacy Stacks Up
Written By Legacy Member, Perry Alexander
Healthy retirees in the Asheville/Hendersonville area of Western North Carolina (WNC) have options when planning their retirement years. Most have faced choices with aging parents about where to live and be cared for. Choices include:
Aging in Place — where we stay in our own homes as long as possible, calling on children or professionals to help out when we need it. That can get complicated, expensive, and even unsafe as we face growing challenges with eyesight, hearing, steadiness on our feet, and general mobility to walk or drive to get groceries, prescriptions, or other provisions. As we advance in years, most of us will experience an increased need for help with household activities, such as meal prep, dressing, bathing, transportation, or even nursing care. And, of course, maintenance of the home, yard, and vehicles doesn’t stop.
As our capabilities diminish, our needs will grow, and the practicality and cost of retrofitting our home or securing and coordinating qualified help can become daunting. At some point, when we’re not be as sharp as we once were—mentally or physically—we will face significant decisions about what path to take. Should we move from our home to a care facility? Which facility will be best? How will we fund it? How will we manage the move? Clearly, at a moment of duress is not an ideal time to be researching resources, calculating budgets, and facing upheaval in our living routines.
Senior Apartment or Independent Living Community — Senior living amenities are focused on your changing needs. These senior facilities often feature common dining halls, social calendars, and transportation. But, assistance with living or medical needs is still the responsibility of the resident.
Continuing Care Retirement Community (CCRC) —With facilities and staff that cater to your changing health needs, from active independent living to assisted living to skilled nursing and rehabilitation. CCRCs usually feature multiple dining venues, workout facilities, swimming pools, outdoor sports courts, walking paths, and on-site health care.
Old vs. New
Full-service CCRCs, certified and overseen by the North Carolina Dept. of Insurance, are the most comprehensive, end-to-end option, allowing seniors to focus more on the joys of life, and less on the challenges that come with aging. A flat monthly fee pays for amenities such as daily dining, workout facilities, transportation, community activities, interior and exterior maintenance, laundry and cleaning services, most or all utilities, and integrated health care. Legacy has a video explaining this in more detail. In the Asheville/Hendersonville area, there are a few CCRCs to choose from. All but Legacy have been around for several years. At first glance, that might seem like an advantage, but they all have wait lists—8-10 years, in some cases. So, when you first contact them, they will probably have no units available. You give them a deposit in exchange for a place on the waitlist, and they contact you to let you know what’s available when you’ve gotten to the top of the list. Timing and floor plan choices are luck of the draw. When you finally get the call in a few years that something has become available, your choice of floor plans will be quite limited—possibly to just one unit. If you don’t like what they have at the moment, you go back on the waitlist—again and again until you finally settle for something you can live with.
It doesn’t have to work that way! There are several advantages to considering a new community, such as Legacy:
- You have a choice of types of residences and floor plans—whether a freestanding home, a duplex, or various size residences in a multi-family building
- There is no waitlist, and while you won’t move in until construction is complete, you’ll know when your unit will be ready—and likely much sooner than if you were on the waitlist of an existing facility
- You will be the first occupant of your brand new home
- You can customize many more aspects of your residence to your liking
- State-of-the-art communications and safety technology, energy conservation measures, and sound-limiting building techniques. Legacy has a series of videos detailing these
- Initial residents, all coming in at essentially the same time, can have a significant impact on the feel and tone of the community.
One well-known Asheville CCRC offers only one healthcare option, called “Lifecare,” where you are required to pay a flat fee, in advance, in case you need assisted living and skilled nursing healthcare in the future. This makes sense for folks without robust long-term care insurance. But for those who do, this is a costly duplication of what you already have. Another well-known, local CCRC offers only “Fee for Service” care, without the option of a flat-fee, prepaid Lifecare contract—ideal for those with long-term care insurance, but probably not for those who do not. Most CCRCs offer one or the other. Legacy, on the other hand, offers both healthcare options, to best align with your personal situation. Legacy has a video, comparing these options
Financial: The Entrance Fee Model, For a Guaranteed Negative Return on Investment
Here’s where it really gets interesting. Except for Legacy, all licensed CCRCs in this region offer only an “entrance fee” model. This means you pay a one-time entrance fee that can range from about $100K – $800K or more, and you are only renting your residence. With this entrance fee model, you have a choice on how much your entrance fee will be. The more you pay for a given unit upfront, the more will be returned to you or your estate when your time there is over. The lowest entrance fee options offer no payback, somewhat higher fees will net you 50% when you leave, while the highest will pay you back 90% of your original entrance fee when you leave. In that case, they’re using your money for years, and you or your estate gets back all but 10% of your original fee. In any event, it’s a guaranteed negative return on your investment.
A Sensible Option: The Equity Model, Where Your Investment Will Likely Grow
Why would you want to hand over hundreds of thousands of your own dollars to the facility to invest and grow for themselves when there’s a different approach where your money has the potential to grow for you? With Legacy’s “equity-based” model, you’re not a renter—you will have purchased your residence outright. Whenever you leave Legacy, you or your heirs can resell your residence—most likely at a profit, rather than a return of 0%, 50%, or 90% of your original entrance fee, most common with local CCRCs.
Your upfront cost to get into an entrance fee-based community that returns 90% of your original investment is similar to your upfront cost to purchase a Legacy residence. If home values will increase over the years, you or your estate will have built equity and will return you a profit on your original investment. Legacy offers the only equity-based model CCRC in Western North Carolina. All others operate on entrance fee models—guaranteed to generate a negative return for residents.
But let’s say you have no heirs, and having a nest egg when you’re gone isn’t a driving consideration. Fact is, with Legacy’s equity model, you can tap that equity, if and as you need or want it (for travel, other expenses, or unexpected medical costs), through a Home Equity Line of Credit. Or, you may want to leave it to a beloved charity.
Legacy has a video about the differences between an equity-based model and an entrance fee model.
About the Authors
Merri and Perry Alexander have no children (if you don’t count their two Boston Terriers) and have committed to becoming residents of Legacy at Mills River. Perry previously enrolled in a deep dive class on CCRCs of Western North Carolina where participants visited and spoke at length with residents of several facilities in the area. In addition, the couple did extensive research and ran financial projections before deciding on Legacy. Now, after having met several other future Legacy residents at pre-opening events, they are even more excited about meeting more fascinating new neighbors and making dozens of new and deep friendships.