The savings from living at home start to fade when extra care is required, writes Rob Carrick.Nithirut14/iStockPhoto / Getty Images
It’s time for a price check on your plans to age at home rather than a retirement facility.
Has any generation of Canadians loved their houses more than baby boomers?
Boomers raised their families and made their fortunes at home. It’s no surprise that many also want to age in their houses as opposed to eventually moving into a retirement home.
A question for retirees planning to age in place: Can you afford it? Unless you’ve looked after aged parents yourself, you’ve likely never confronted the cost of having a personal support worker come by your home to help with personal care and other tasks.
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A new online tool can help fill you in. The Cost of Ageing Calculator from the National Institute of Ageing at Toronto Metropolitan University offers tailored estimates of living costs for a modest, moderate and comfortable lifestyle in your family home, in a retirement home and in a long-term care facility, aka a nursing home.
You can specify if you’re a renter or owner, if you’re single or have a partner and how many hours of home care you need. Data is available for eight different cities or parts of the country.
The calculator shows that the most cost-efficient retirement is lived in a home you own. For example, a retired couple can live at home at a comfortable level in Calgary at $49,847 per year, excluding mortgage payments and condo fees. A retirement home in the comfortable category for this same couple would cost $120,947, while a moderate retirement home would cost $90,918 and a modest home would cost $64,602.
The savings from living at home start to fade when extra care is required. Five hours of home care a week brings the cost of a comfortable lifestyle to $60,635 for that same Calgary couple living in the home they own. Twenty hours a week would produce an overall cost of $93,001, while 40 hours would cost a total $136,155.
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These numbers tell us that ageing at home is as much a financial calculation as a lifestyle, health and safety choice. The complication in making choices about ageing is that it’s hard to mentally engage with your future infirmity.
The feasibility of living at home in your later years is linked to your ability to perform the following aspects of self-care: looking after your bathing and other aspects of personal hygiene, dressing and feeding yourself, walking, toileting and transferring from lying down and sitting to standing.
You may be fine with these functions for an extended period, then find you need increasing levels of help from personal support workers. Financial coverage of minimal PSW hours may be provided by provincial health care, but not enough for extensive needs.
A retirement home could be more expensive than remaining at home with minimal or moderate PSW care. But retirement homes offer two compensating benefits: no risk of exceptional home maintenance costs, and none of the demands of home ownership,
Owning a home requires muscle and decision-making power as much as money. You can shovel your driveway in winter and look after the yard in summer for only so long before needing help. Wrangling quotes from contractors and then managing a project like fixing a leaky basement takes stamina, patience and the radar to identify predatory contractors who would take advantage of trusting seniors.
Adult kids and other family members may be able to help with the upkeep on a house, but what about seniors who live far away from family or are childless?
A lot of the public discussion of retirement focuses on how much money you need to save, but the bigger question is how much money you’ll need to live a comfortable life. The estimate of home much you’ll need depends a lot on your plans for travel, your activities and, increasingly, how much support your adult kids need.
But longer lifespans demand that attention be paid as well to the cost of your chosen mode of living in your later years. Will you stay at home with help as required or try a retirement home, and what if you need the higher level of care available in a long-term care facility? Wherever you plan to go, the Cost of Ageing Calculator helps make sure you can pay your way.
