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What's the Difference? Monthly Rental vs. Entrance Fees in Senior Living

Having choices is a wonderful thing for all aspects of our lives. It’s nice to have a choice in where to eat, what to do and how to live. It’s great for when you’re looking at senior living communities, as well – but the choices you find can be confusing and may feel like comparing apples to oranges. 

“There are many different types of independent senior living options, and seemingly just as many ways they charge fees and monthly rates,” says Kristine Tilton, Executive Director of Waterstone at Wellesley. “For example, Waterstone at Wellesley is an independent retirement community for active senior adults, and we charge on a month-to-month rental structure,” she says. “If you’re searching for senior living options, you’ve probably heard of other types of communities, namely ones called CCRCs that can charge large entrance fees.”

Every form of senior living community has benefits and downsides, she says, and depending on your own personal situation, one option may clearly be better for you than another. We’ll break down the information on two of the most common forms of communities – a monthly rental structure and an entrance fee structure – so you can make an informed decision for your situation. 

Monthly Rental Communities: Freedom and Flexibility

A monthly rental senior living community has a lot in common with traditional apartment-style living. Individuals who wish to live at the community pay a security deposit – usually totaling one month’s rent – and then continue to pay monthly “rent” for as long as they choose to live in the community. Sometimes the security deposit is refundable after a certain amount of time. 

Services and amenities can vary greatly from community to community. Some bill themselves as 55+ or age-restricted communities, and offer just the basic forms of amenities: a clubhouse, wellness center and perhaps other services. Other communities may offer services comparable to a five-star resort, with all-inclusive pricing that covers dining, activities, home maintenance, utilities and sometimes, a certain level of medical and wellness care. 

In many instances, a monthly rental community offers primarily independent living, and may offer assisted living services (usually for an extra cost) for residents who end up requiring an extra level of care in order to live safely. However, the community is not obligated to provide this type of care, so in some instances, a senior might need to move to a different community in order to have their needs met. 

One of the biggest reasons a senior might choose to move to a monthly rental community is flexibility. Since contracts are on a month-to-month or yearly basis, residents are free to move if they desire or wish to go somewhere else – without having to worry about losing a huge deposit or dealing with complicated red tape. This can be freeing to many seniors, who may only wish to stay in a place for several years without having to make a lifetime commitment. 

Entrance Fee Communities: Peace of Mind for Life

Continuing Care Retirement Communities (CCRCs), also known as Life Care Communities, have been a popular senior living option for some time now. For many years, this was the form of lifestyle for discerning seniors who wanted the peace of mind that came from moving to a community where they knew all their needs would be met, no matter how their health or situation might change in the future. 

For the sake of this article, we’re calling these “entrance fee” communities because this form of senior living requires future residents to pay a hefty sum – sometimes in the six-digit range – to “buy” their entrance to the community. In general, the sum is held in some form of trust, and can be partially refundable (or, at the very least, have a large chunk of it returned to the seniors’ estate). 

Entrance fee communities also have strict financial requirements for their residents. Before someone is accepted into the community, their finances will be thoroughly researched to make sure that they can afford a long-term lifestyle at the community. Depending on the financial situation, seniors can be disqualified or have to take a penalty in order to live there (such as a non-refundable entrance fee). 

However, once a senior is accepted into a CCRC, they will pay a set monthly payment for life, no matter if or how their health needs change. (Yes, you will still have to pay monthly “rent” of sorts after paying a large entrance fee.) In many communities, there are also safeguards in place in the event that a long-term resident suffers some sort of financial setback and can no longer afford the monthly fee. Communities may have a fund or foundation that will enable the resident to remain at the community for life, even though they can no longer afford to pay. 

The biggest reason a senior would choose to move to an entrance fee community is for security and peace of mind. These communities run the entire gamut of the senior living spectrum and offer independent living, assisted living, memory care services, skilled nursing and rehabilitation all on one campus. It’s convenient, it’s safe and it helps seniors and family members feel secure, knowing that care will always be available, no matter what. 

What’s the Right Choice?

There’s no one right or wrong answer – it all depends on your individual situation and the type of lifestyle you wish to have in your retirement. Of course, as a monthly rental community, Waterstone at Wellesley was designed because our leadership feels that a flexible, month-to-month contract provides many more benefits than a CCRC can provide. 

“One of the issues that residents may face in an entrance fee community is that not all care types are created equal,” says Kristine. “For example, the assisted living lifestyle may be spectacular, but independent living may be mediocre at best. Another issue is that those who enter an entrance fee community are rolling the dice in terms of the care they might need. Whether you remain in independent living for the rest of your life or if you end up needing memory care services, you pay the same price – so, in essence, healthier individuals end up paying more for less care.”

By contrast, a monthly rental community allows seniors to be choosy about care if and when it’s needed. “The nice part of living at an active, independent retirement community like Waterstone at Wellesley is that you don’t have to pay for an extra level of care until you need it,” she says. And if you do discover you need more assistance to live safely, she says, you’re free to hire in your own care – or move to a top-rated community of your own choosing. 

“We know that today’s senior wants the greatest choice possible, and that’s what we provide at Waterstone at Wellesley,” she says. “With luxurious living options, high-end services and amenities and so much more, we are the premier choice for discerning senior in Wellesley, MA. Both our independent living and assisted living services are the best you’ll find in the area, and our amazing staff is dedicated to providing you the service, care and choice that you want and deserve.”

For more information about our distinctive independent lifestyle, please contact us at 781.235.1614.

Beautiful Riverfront Community

Located on the banks of the Charles River, Waterstone is Wellesley’s only senior living community, offering premier independent and assisted living. But that’s only the first of many differences that sets Waterstone above and beyond other communities.

Celebrating Dynamic Living

Here our residents live independently in their own private, spacious apartments – but without any of the worries or concerns of homeownership or living alone. All meals are expertly prepared. There aren’t any chores to be concerned with. No home maintenance or repairs to worry about. Just opportunities around every corner and time to spend as they choose – in the company of new friends.

Our vibrant community encourages residents to engage in a variety of recreational, cultural and social programs and activities. Enjoy a fitness class. Swim in the sunny indoor pool. Take a stroll on a walking path. Partake in a favorite hobby or pastime. Discover a new interest. With Waterstone at Wellesley, there’s a world of opportunity waiting right outside our residents’ doors. 

Confidence of Care

The hallmark of Waterstone assisted living is the peace of mind we provide both our residents and their families. Knowing that care and support is available right on site instills a sense of confidence and calm one can’t find living alone. 

For prospective residents or their families interested in residing at Waterstone at Wellesley, please contact us at 781.235.1614.