Types of Retirement CommunitiesA senior retirement community offers three main features — security, senior-focused amenities, and a sense of community. Security ranges from gated facilities to emergency alarm response features within the senior homes. Amenities for seniors are based on the age, abilities, and interests of seniors aged 55 and older. A sense of community allows seniors to maintain social connections with other residents who are in the same stage of life. There are four main types of senior retirement communities that fit this description. These include:
- Assisted living retirement communities
- Independent living retirement communities
- Age-restricted retirement communities
- Lifestyle retirement communities
Assisted Living Retirement CommunitiesAssisted living retirement communities provide a moderate level of care. This type of living arrangement allows seniors to live in their own homes (i.e., apartments, condos, or single family dwellings). However, they also receive assistance for basic and vital needs, such as help with getting dressed, meal preparation, taking medication, and transportation.
Did You Know: Visit our guide to planning for housing in retirement for tips on finding the best home for you, your lifestyle, and your budget.
Independent Living Retirement CommunitiesSimply put, independent living communities are designed for active, healthy seniors who are able to live on their own. You can live in a home, townhouse, condo, and even a mobile home or motorhome. You can own or rent or live as part of a cooperative. Think of it like living in your old neighborhood except these communities have age restrictions — usually over 55 — and most offer amenities like clubhouses, gyms, yard maintenance, housekeeping, and security. Independent living communities also typically offer transportation, laundry service, group meals, and social and cultural activities.
Age-Restricted Retirement CommunitiesAge-restricted communities are often marketed to certain ages, such as 55+ communities. Some communities — marketed as “age-qualified”— require at least one person who is 55 to live in at least 80 percent of the occupied units. These properties are regulated by the U.S. Department of Housing and Urban Development (HUD) and The Fair Housing Act. Also, people under 19 years of age cannot be permanent residents. The communities that are marketed to a certain age group but don't have the same age restriction are called “age-targeted.” These communities focus on their senior demographic with amenities and conveniences, but anyone can live there regardless of age.
Lifestyle Retirement CommunitiesWith 76 million baby boomers beginning to retire, the demand for retirement communities is greater than ever. The number of senior living options for different lifestyles is also greater than ever. Here’s a sampling of some specialized retirement communities:
- University and college-based retirement communities
- Faith-based retirement communities
- Golf retirement communities
- Boating retirement communities
- Artist retirement communities
- LGBTQ+ retirement communities
- Manufactured/modular home communities
- Luxury apartments
- Singles sharing homes
Retirement Community OptionsWhen choosing the best type of retirement community for your needs, consider the options available to you based on location, financial resources, level of care, and expectations. For example, if you have unlimited funds and are an active senior, you can choose luxury retirement communities, active senior communities, and continuing care retirement communities (CCRCs) anywhere in the nation. For seniors who are on a fixed income, note that most retirement communities have two major fees. These include a one-time lump sum to pay for the housing and a place within the facility. This ranges from $100,000 to $500,000 at the more modest senior retirement communities. On top of this, a senior will be responsible for paying a monthly fee that covers services, such as food, housekeeping, and activities. If you are considered low income, you will need to look for affordable retirement housing, such as low-income senior housing. This is provided via HUD through your local Department of Family and Human Services.
Retirement House CommunitiesRetirement house communities are perfect for older adults who want to live in single-family housing. This type of senior housing can be found in specialty communities, such as university-based retirement communities, senior golfing communities, senior living co-ops, and CCRCs. Note that when you purchase a house for senior living within a retirement community, you will be paying the mortgage on the home. In addition, most of these communities feature homeowners associations (HOAs), which will require you to pay yearly HOA dues. In essence, you are living in a stand-alone home in a neighborhood where you have total freedom and autonomy. Yet your neighbors are all older adults who may have the same interests and lifestyles, allowing for a cohesive community. Your HOA will typically provide services geared toward older adults, such as inclusive lawn care and wheelchair-approved walkways and paths. This type of senior housing is best suited for individuals with a minimal level of care. However, you do have the flexibility to hire a private in-house nurse who can care for you in your home if needed.
Retirement Apartment CommunitiesThe most common type of senior housing in retirement communities is apartment units. An apartment unit for luxury retirement communities is typically referred to as a condo. Meanwhile, low-income older adults can live in apartments commonly known as Section 8. Ultimately, with a senior retirement apartment, you would be living in a building where all of the residents are seniors over the age of 55. Keep in mind that with some HUD apartments, there is a stipulation where only 80 percent of residents must be over 55, which means a few residents may be younger than that. Living in an apartment for seniors allows for a tighter knit community, since the units are connected, allowing seniors to interact more regularly. Also, apartment managers may be hired to provide additional services especially for senior adults, such as meal preparation or social activities. As for paying for a retirement apartment, older adults typically pay rent on a monthly basis. Depending on the type of housing unit, i.e., a low-income apartment, the rent may be based on a government guideline or provided for with stipends.
Paying for Retirement Community LivingIn order to cover the cost of a mortgage along with HOA dues or monthly service fees, an older adult living in a retirement house will often choose one of two routes. They will take out a reverse mortgage on their primary home or property, which allows the homeowner to use their home equity as cash that is then used to pay for a senior home. Otherwise, the senior can sell their primary home outright and use the proceeds to cover the costs of a senior house. For a senior apartment, these are secured through monthly rent payments. This works the same as a senior apartment for adults in terms of costs; there is no lump sum to be paid up front. However, if the senior is living in an assisted living facility or specialized care, they will have to pay more for additional health care services not included in the facility's basic amenities. According to Genworth’s Cost of Care Survey, the national median cost for assisted living was around $4,500 per month in 2021, which adds up to $54,000 annually. Paying for a senior apartment on a monthly basis typically involves taking funds from several sources. This includes Social Security benefits, retirement accounts, and personal savings and investments. You may also need to utilize financial resources from your children or other family members to help pay for senior housing. Charity organizations can also help low-income seniors pay for affordable senior housing.
Beyond the Marketing BrochureFinding the right mix of conveniences and amenities and an affordable price is the surface stuff. Factors below the surface, the ones that aren’t mentioned in the marketing, are just as important. These things can go a long way to making your retirement years enjoyable. Below are some considerations and questions to ask as you tour a retirement community.
- Talk to residents. Do they live there part-time or all year round? Are they happy with where they live? What do they dislike about the community? Were there any surprises? Is the property management company responsive to issues or requests?
- Ask the residents about the HOA. Do they attend meetings? If so, how are the meetings held? Do residents get ample time to speak?
- Is the developer financially solid? Are there resources in place to resolve any construction issues? What are the plans for further development? Have they built other communities? How are those communities functioning?
- Is there a reserve fund (aka “sinking fund”) for maintenance? This is set aside money for things like roof replacement, air conditioning replacement, and so on. This fund is typically a line item on the HOA’s budget.
- If there is surrounding, undeveloped property, who owns it, and how will it be used in the future? Is it a commercial property? Mixed use? You probably don’t want a shopping center or airport built in the adjacent land.
- Get a copy of the HOA’s bylaws. Are there any rules you couldn’t live with? Some communities won’t allow any changes (like painting or modifications) to the exterior of the property without HOA approval. Others won’t allow any flags — even the American flag — to be displayed outside.