Many older adults want nothing more than to stay in their own homes, even as they get older and often require medical care. However, "aging in place" can be quite pricey, even if your home is already somewhat well-suited for what you may need down the road.
So, can you afford aging in place, and how exactly does it work? Read on to discover the answers to these questions and more.
Aging in place, put simply, means getting to live out your post-retirement years in the home that you currently live in. No American wants to have to downsize to something new, or leave their current home for a retirement home, particularly if they have lots of good memories in their current property.
Unfortunately, aging in place can be difficult for many older Americans. Difficulties around mobility and daily activities can require long-term care and assisted living from caregivers or providers for older people, which often come from family members/loved ones or nursing homes. Your well-being will be affected by your care plan and how your daily living impacts your energy, mobility, and more.
For example, say that you have a two-story house and your bedroom is located on the second floor. What might happen if you develop a mobility issue, like arthritis in your knees? You may need to either move your bedroom down to the first floor or spend thousands on a stair lift.
Aging in place often means spending a lot of money to renovate your property or to add additional accessibility features. These can include ramps, grab bars, automatic stair climbers, and more. Furthermore, you may need in-home care — while some or all of these costs could be covered by Medicare for certain individuals, many others will need to foot these bills themselves. These potential financial burdens increase the financial pressure to sell their current houses and downsize.
There are a lot of factors involved with aging in place, including:
Still, aging in place means a lot to the aging population, who increasingly don’t want to live in care facilities or even senior living communities.
So, determining whether or not you can afford to age in place is a very important topic, particularly if you are looking to retire in the future or have recently retired.
Generally, you should expect a hefty investment toward improvements or home modifications if you choose to age in place. You’ll also want to consider the likelihood of additional costs like in-home care, medical appointments, and much more.
Then there’s the fact that you’ll need to continue to make mortgage payments if you haven’t already paid off the house. Depending on whether or not you’ve already paid off your current property, your mortgage payments might be a little too expensive for you to cover, depending on your monthly income post-retirement.
Typically, these age-in-place-related costs are paid by:
Unfortunately, many senior citizens find it difficult to stay in their current properties because of rising mortgage costs. This is especially true for homeowners who took out mortgages with variable rates.
Once you stop working, you might find that your retirement savings and other income streams aren’t enough to help you keep up with mortgage payments, forcing you into housing options you may not necessarily be interested in.
Here’s where Balance can help.
If you get accepted into Balance's homeownership program, your mortgage loan will be transitioned into an equity investment.
In other words, Balance will pay off your mortgage, and in turn, you’ll make a monthly payment to Balance, which covers your stay in the house and contributes towards your portion of taxes and insurance.
The benefit? You don’t have to worry about expensive mortgage payments in perpetuity, and you get to stay in your property for as long as you’d like.
Even better, we pay up to 85 percent of your home’s value in equity. With that money, you can fund any home renovations you need to make your property more accessible for your needs.
Balance has already helped many senior homeowners age in place with peace of mind and without breaking the bank.
As co-owners of your property, you get to remain in the home you’ve built and lived in for decades, replacing your expensive mortgage payments with simplified, affordable monthly payments to us that cover your exclusive occupancy of the home, your share of property taxes, and insurance.
In the meantime, your home will continue to appreciate in value and gain equity, and you’ll always reserve the option to buy us out of the equity share later on. Get started with Balance today.