The Differences Between Life Plan Communities and Rental Communities

A group of women in a senior living community laugh together.

If you’re looking for an active retirement that gives you the freedom to pursue your interests, there are multiple options to choose from. Two of the most popular are a rental retirement community and a Life Plan Community. And each choice seems to have a different price tag. So how do you know which senior living community is right for you?

When it comes to Life Plan Communities versus rental communities, it’s important to know the differences and what you can expect from each. This blog post will provide an overview of what you need to know to make a more informed decision.

Rental community.

A rental retirement community is a good option if you’re able to live on your own, without the need for higher levels of care. When comparing Life Plan Communities versus rental communities, one of the features that stands out most is the rental option doesn’t require an entrance fee. But there’s more to consider than what you’d be paying today. Here’s some general information about rental communities:

  • Fees: Residents sign a lease for an agreed-upon length of time — anywhere from month-to-month to a year. While there may not be an entrance fee, there will likely be a security deposit, which may or may not be refundable. Your monthly fee is determined by the size of your residence, the level of care you need and the amenities you use.
  • Lifestyle: A variety of services and amenities will be built into your monthly payments. While they will vary by community, it can include meals, housekeeping, maintenance, transportation, and on-site events and activities. In general, rental communities offer more à la carte services than Life Plan Communities. Be sure to review the rental agreement to see which services are included and which will have the extra cost added to your monthly fee.
  • Care: Most communities provide independent living but some may also offer higher levels of care including assisted living services — either in your home or in a different area of the community — and dementia care services. However, for these higher levels of care, you may have to pay full market rates.

Life Plan Community.

Also known as a Continuing Care Retirement Community (CCRC), a Life Plan Community offers maintenance-free independent living plus access to a continuum of care — typically including assisted living, memory care, skilled nursing and rehabilitation. Care is usually provided on-site or nearby, so you don’t have to worry about making a move during a health emergency. Other features include:

  • Fees: Life Plan Communities require an initial entrance fee plus a monthly fee. This contract structure offers tax advantages that can save you money over time. (Consult with your tax advisor.) The entrance fee secures lower rates for any future care you may need, but the available discount varies depending on the terms of the contract you sign.
  • Lifestyle: For example, your monthly fee covers the cost of utilities, housekeeping, maintenance, choice of meal plans, activities, programs, classes, on-site cultural events transportation and the use of all community amenities.
  • Care: With the upfront investment of an entrance fee, a buy-in option may look more expensive. However, the plan for lower-cost, predictably priced long-term care adds value and peace of mind that’s hard to put a price tag on.

Caring for your future.

When it comes to choosing between Life Plan Communities and  rental communities, the biggest factor is whether or not you think you’ll need care in the future. But before you decide, consider this — the U.S. Department of Health and Human Services reports that 70% of seniors 65 and older will need some type of long-term care — with an average stay of approximately 3 years. And even if you don’t need care, what about your spouse?

According to the latest Genworth Cost of Care Survey, the average cost for assisted living in Chicago is $4,429/month; a private skilled nursing room costs $9,086/month.

At Wyndemere, we offer a variety of contract options ranging from LifeCare® to fee-for-service and are sure to have one that will fit your budget. Our LifeCare contract option provides you with unlimited days of quality, long-term care at essentially the same monthly fee.

Experience our Life Plan Community firsthand.

To learn more about the engaging lifestyle of residential living and peace of mind of on-site care — assisted living, memory care, skilled nursing and rehabilitation — Wyndemere offers you and your family, contact us here. One of our senior living sales  counselors would be happy to discuss your options with you.