Retirement Tips

Moving to a retirement village is not only a lifestyle decision, it’s also a major financial one. If things don’t work out, extremely high exit fees might leave you without enough money to seek alternative or more suitable accommodation.

About 5% of Australians aged 65 and older live in retirement villages. This is a growing sector, with the number of villages increasing by more than 8.5% over the three years to July 2010. The majority of accommodation options in a retirement village are independent living units; only about 7% are serviced apartments.

While independent living units can give you the option to pay for services such as meals and cleaning, a retirement village is usually not suitable if you need a high level of care – in that case, consider an aged care facility (nursing home).

If you are considering this option, take your time. You’re more likely to choose the right retirement village if you don’t make a quick decision:

•    Think ahead and consider what you might need in the future – will you be able to continue to live there if your health or mobility declines?
•    Imagine the lifestyle you’d like to have in a retirement village, and make a list of the things you think are most important.
•    Visit different villages and find out about the lifestyles they offer, including housing options, facilities and services.
•    Talk to the residents – they know better than anyone what life is like in the village they live in.
•    Read the disclosure statement and occupation right agreement for the village.
•    Find out the total costs. What will you have to pay on entry? What are the ongoing expenses? Will you share in any capital gain when you leave? Will you have to pay for any capital loss? How will these affect your future and the choices you have?
•    Get independent financial advice from a financial adviser or accountant with experience in retirement villages.
•    Get independent legal advice from a lawyer with experience in retirement villages. Ask them about the different legal titles and what they mean.
•    Involve your family or friends in your decision.

Disclaimer
Information current as at 5 November 2015 – This information is of a general nature only and has been prepared without taking into account your particular financial needs, circumstances and objectives. While every effort has been made to ensure the accuracy of the information, it is not guaranteed. You should obtain professional advice before acting on the information contained in this publication. You should read the Product Disclosure Statement (PDS) before making a decision about a product.