Ask DWM: What are the Pros and Cons of Aging in Place?- Part 1

September 15, 2023

Actually, the Ask DWM question originally was: “Should we move into Senior Housing complex A or B? We suggested that a major lifetime decision like this requires a comprehensive review and discussion. Ultimately, we broke the clients’ question into three pieces:

  1. What are the Pros and Cons of Aging in Place?
  2. What are the Costs of Senior Housing?
  3. What are the Insurance, Income Tax, Estate Tax and Timing Considerations?

Today’s blog is the first of three, followed by answers to questions two and three next week and the following week. And, if after that is complete and you still have questions, please let us know.

My mother wants to Age in Place.  She is 93 and still very much “with it”- still living independently and driving her own car. She loves her house and wants to stay there as long as she can. She and many others prefer to “age in place” in their own home near family, friends, and neighbors. However, living at home may also pose challenges including costs, medical care, loneliness and managing household tasks. Let’s look at the key differences between aging in place vs. growing old in an assisted living facility.

Aging in Place really sounds good to most of us. AARP says 77% of adults 50 and older prefer to grow older, and even die, in their home. This percentage has been consistent for more than a decade. The number of households headed by people 65 and older is expected to increase from 34 million currently to 48 million in the next two decades.

Here are some of the advantages of Aging in Place:

  1. The cost is usually less, depending on your current living condition and health.
  2. Familiarity with the neighborhood can be very important for seniors.
  3. Staying put reduces the fear of isolation.
  4. Adding personalized home modifications can make the current house “perfect.”
  5. Eliminating big changes at this stage of life feels good.

However, here are some of the reasons Aging in Place may not be best.

  1. Organizing and maintaining appropriate and responsible in-home health care can be daunting.
  2. The cost of extensive in-home care can be extremely expensive. Hourly costs to provide in-home care typically are between $20-$40 per hour. If we use an average of $30 per hour, then 4 hours of care per day is $120. But 24 hours a day is $720. The American Council on Aging says the average daily cost for an assisted living facility is $300 per day.
  3. Limited access to medical care, especially in emergency situations, can be a concern.
  4. Modification of the home for safety and convenience can be quite expensive, depending on the home.
  5. If the current home is too far away from family and friends, then it tends to cause more isolation as you get older.
  6. Home maintenance may also be a problem due to physical limitations of the elderly owner.
  7. Remaining home alone as cognition declines, and without supervision can be very dangerous.
  8. Without regular supervision, some seniors may not eat healthy meals.

The key Factors in determining if Aging in Place is best for Mom or Dad are their Wishes, their Health, their Finances, and their Location.

  • Wishes. At DWM we work with families; in some cases, three generations. Our primary focus is on the oldest generation, and we believe parents are to be honored. We believe that their wealth should be there to promote their health, happiness, and comfort for the rest of their lives. 

  • Health. Health is a key consideration. Older adults with physical problems or cognitive disorders may benefit from living in a more supportive environment, such as an assisted living facility. One of the big issues is the rate of decline. One bad fall can move an independent senior from being able to handle everything independently to needing assisted living.

  • Finances. Ample finances make the choices easier. Aging in place may become expensive and assisted living can be quite expensive as well. In our example of daily, 24-hour in-home care at $30 per hour, that would cost about $21,000 per month or $250,000 per year. Of course, Assisted living is expensive too. Fees can be $10,000 per month or $120,000 per year. Of course, depending on the facility, there may also be purchases of units or entrance fees in the hundreds of thousands of dollars or more. We’ll spend next week’s blog on costs. For now, let’s conclude that aging in place or in a facility can be very expensive.

  • Location. Certainly, it’s wonderful if family and friends are close to you. Sometimes it is not possible. Again, we would conclude for now that location should be your choice assuming health and finances are adequate.

Of course, each of us is unique. We have our own qualities, instincts, assets, limitations, and desires. So, the answers to the above questions about aging in place need to be reviewed very carefully in each situation, whether it is an individual such as my mom or with a couple, and sometimes with their children as well.

After we reviewed the above, our clients who asked the question about Housing complex A or B concluded that they were not interested in aging in place. Their health is very good, their finances are excellent, and they love their town. They are planners and like to have things organized so when one of them declines, they are in a facility that can provide assisted living and memory support in the same complex. These full continuums of care providing both independent living and skilled nursing care are called CCRCs (“Continuing Care Retirement Communities”) or LPCs (“Life Plan Communities’). They don’t want to be a burden to their family, and they would prefer to live in a facility independently for some time before they decline.

For them, we then moved on to the next question, “What are the Costs of Senior Housing?” which will be our blog next week. Have a good weekend.

Detterbeck Wealth Management is a fee-only financial planning / wealth management company with offices located in Palatine, IL (Chicago area) and Charleston, SC areas serving clients locally and across the country. To contact us about setting up an appointment, please see our contact us page