Wondering whether to make the move to a retirement village? Not sure if it’s right for you? Start by asking yourself these questions:
- IS THE ACCOMMODATION AND CARE RIGHT FOR YOU?
Retirement Villages are a great choice for many but they do not suit everyone. It is important to consider at the outset whether the levels and types of care and accommodation available are right for you. This can help to avoid the upheaval and expensive of a further move.
- HOW MUCH DOES IT REALLY COST TO MOVE IN?
In addition to the Ingoing Contribution (usually advertised as the purchase price) there are other costs to factor in. These vary from village to village but often include:
- The legal fees of the Scheme Operator of the village;
- The fee for the lodgement of documents at the Titles Office;
- Paying extra for any alterations you wish to have made to the unit before you move in; and
- Paying extra for a garage or car parking space.
You may also have to factor in the cost of selling a former home and moving costs.
- WHO’S MOVING IN?
The Scheme Operator will usually require whoever lives in the unit to be registered as the joint owners or lease/license holders. Does this suit your circumstances?
You should also consider what would happen if one of you needs to move to aged care or dies and how there scenarios would play out.
- HOW MUCH DOES IT REALLY COST TO LEAVE?
Leaving a retirement village can be expensive. Exit fees and entitlements vary from village to village and even unit to unit. Some Scheme Operators offer a variety of packages to prospective residents which can impact significantly fees payable.
Will you get any share of capital gain or whether you will be expected to share in any capital losses? Exit fees vary but it is not uncommon to see residents paying over 35% of what they paid to move in only 2 or 3 years after entry.
These fees are not designed to put you off a move to a retirement village. For many, these villages offer a new lease of life but they are not for everyone. So doing your homework first and ensuring as best you can that the move is right for you, could help reduce the risk of significant expense later.
- HAVE YOU OBTAINED FINANCIAL ADVICE?
Financial advice is crucial to a move to a retirement village. Not only are the financial arrangements complex in terms of moving in, living at and leaving a village but there is likely to be significant change to your financial affairs as a result. These could impact your pension entitlements, ability to afford a certain standard of lifestyle and the ability to afford aged care in the future.
- HAVE YOU DISCUSSED THE MOVE WITH YOUR LAWYER?
Legal advice is critical when moving to a retirement village. The legal complexities of moving in, living in and leaving the village as well as the complex and usually significant volume of documents presented to prospective residents should be reviewed by a lawyer to ensure they meet the retirement village legislation and any other legislation applicable.
It is important to understand the contracts and documents provided to you by the Scheme Operator because these documents detail how your relationship works with the Scheme Operator, your rights and theirs as well as how your relationship can be ended and the related costs.
CRH Law have many years of experience in providing advice about retirement living. Our dedicated team will guide you through the complexities of a move to a retirement village.