The Value of Predictability
In an age where healthcare costs are rising unpredictably, the financial certainty provided by a Type A contract presents a tremendous value. By making a one-time entrance fee payment, along with a monthly fee, you’ll enjoy the retirement lifestyle you want with priority access to the adjacent health center for assisted living, memory care and long-term care in a skilled nursing center, if ever needed – all without worrying about increasing costs. This means that if you require additional care later on, you and your loved ones will know exactly where care will be provided, and you won’t face the financial strain that often accompanies these unexpected life changes.
Imagine needing care in your 70s or 80s. If you had not made the initial investment, you might be looking at significant out-of-pocket expenses that could jeopardize your retirement savings and your financial estate. In contrast, by locking in your monthly fee now, your healthcare costs are fixed, allowing you to protect your nest egg from the ever-rising costs of care on the open market.
Tax Advantages of a Type A Contract
When you make the entrance fee payment on a Type A contract, a portion of it may be classified as prepaid medical expenses. This allows you to deduct these expenses on your tax return in the same year you sold your home, effectively reducing your taxable income. This strategic timing can create substantial savings, enhancing the financial viability of your move.
For many, the decision to sell their long-time home can lead to sticker shock when considering the costs associated with moving into a retirement community. However, understanding the tax implications further highlights value of a Life Plan Community.
Comparing Costs: Locking in Rates vs. Future Needs
Let’s break down the costs involved in choosing to lock in rates at a Life Plan Community like Stoneridge Creek versus paying for care later. At first glance, the entrance fee may seem high, but let’s consider what you would pay if you were to require care in the future.
For example, the average cost of assisted living can range from $4,000 to $6,000 per month, depending on location and services. If you were to need care for five years, the costs could easily reach upwards of $300,000. In contrast, your initial entrance fee, which covers these services, becomes a one-time investment that secures your future care at a predictable cost and your monthly fees remain relatively stable.
Additionally, if you factor in the inflation of healthcare costs, which historically rises at a rate faster than standard inflation, the savings realized by locking in your rates becomes even more pronounced. By opting for a Type A contract, you essentially protect yourself from future price increases and secure a monthly fee that stays about the same even if higher care is needed, making this decision a financially sound move.
The Stoneridge Creek Community Advantage
Living at a Life Plan Community like Stoneridge Creek offers a vibrant, supportive environment that cultivates fun and friendships – but it’s not just a lifestyle choice. While residents enjoy a sense of belonging and engagement, with hundreds of monthly activities and social opportunities that enhance their quality of life, they also have priority access to the adjacent health center. This allows residents to stay within a familiar community as their needs change, avoiding the stress, upheaval and costs that often accompany a move to a new location for care.
Choosing a Type A contract at Stoneridge Creek is a financial strategy that offers predictable rates, potential tax benefits and peace of mind. By making this sound investment, you can secure your future and focus on what truly matters: enjoying your retirement lifestyle.
If you’re interested in learning more, read about the costs and benefits of our Life Plan Community.
