Finances with Kelley Keehn: Is it cheaper to age at home?

I still often think of my Uncle John, who lived to the robust age of 95. Although I can’t imagine how he could have lived longer, I do wonder if he could have lived better in his later years.

As my uncle grew up in the lean era of the Depression, he never parted with his money easily for his own comfort. Sometimes I ask myself: If I had taken the time to clearly analyze with him the financial costs of living at home versus a retirement residence, would he perhaps have avoided that fall in his home when he broke his hip? As a “tea and toast” bachelor, would he have benefited from wholesome, home-cooked meals as opposed to drinking a store-bought nutritional shake every day to get his nutrients?

Comparing the cost of two lifestyles

If you or a parent are trying to make the often-difficult decision to either age at home or in a retirement community, please be sure to weigh all of the pros and cons, both from a financial and lifestyle perspective. This is a process you’ll want to support with time and patience; it’s not to be rushed for a fair comparison.

Karen Henderson, Independent Planning Specialist with the Long Term Care Planning Network, spoke with me about this topic. “It’s complicated!” she started. “There’s no template. Do you live in a house, condo or apartment? Do you have mobility issues that would require major renovations? And of course, what is the state of your health? Home care across the country varies from $24 - $35 an hour, and nursing is $60 plus per hour. I knew one family who was spending $10,000 a month on premium care for their father when he was battling prostate cancer and decided to stay at home.”

Analyzing the belief that aging at home is “free”

If you’re like my Uncle John, you may assume that living at home is “free,” but that isn’t entirely true. Here are four financial considerations if you or a parent are opting to stay in your own home:

  1. Daily living expense. When you add up all of your monthly and annual costs to run and live in your home, you may be surprised to find how much you spend each month to maintain your quality of life. In some cases, an option like a retirement residence doesn’t cost that much more than the lifestyle someone currently leads.

  2. Tallying up the cost of home care. Depending on your province of residence, home care costs can vary widely as mentioned above. Without realizing it, you or a parent could be spending upwards of $120,000 per year in home care costs if significant health care is required, just as Karen’s clients were. That is actually more expensive than life in a retirement residence! And don’t forget any costs for additional needs like meal delivery, housekeeping, snow-shoveling or home repairs and maintenance.

  3. The cost of staying social. Research continues show how important it is to stay social in our retirement years, and for those people who take this to heart, there’s still a cost involved. Transportation costs of things like taxis or car insurance if you still own your own vehicle, entertainment costs like coffees or meals out with friends, or other recreational endeavors like exercise classes or shopping trips all add up quickly.

  4. Home ownership expenses. Even if you are now living mortgage-free, there are expenses involved with owning a home or renting an apartment. Property taxes, utility bills, insurance, condo fees—the list goes on.

The value of choosing life in a retirement community

Once you do your cost comparison, if you aren’t in need of a lot of care from a home care provider, you may still find retirement living will cost more than you are paying at home currently. However, when you think of the value of services a retirement residence offers—such as dining options, fitness and leisure opportunities, round-the-clock security, and the social atmosphere—you may find the cost well-worth it, as it can make life more convenient, fulfilling and overall enjoyable. Like my Uncle, you may find it tough to switch from “saving” to “spending,” but if you can afford it, consider it an investment in your health and wellness.

My Uncle John made strategic decisions with his investments, but not the investment of his lifestyle during his retirement years. If you’re considering retirement living, I encourage you to meet with a Chartwell Retirement Living Consultant or your Certified Financial Planner to understand the numbers so you don’t end up missing out like he did!

For more financial advice about retirement living, visit my page on chartwell.com.

Kelley Keehn About Kelley Keehn

Kelley Keehn is a Personal Finance Educator, author, speaker and media personality with over 20 years in the Canadian finance industry. Her tenth book, Talk Money to Me, published by Simon and Schuster, will be available in December 2019. She’s the Consumer Advocate for Financial Planners Canada and serves on many other prominent financial committees. Over the last three years alone, she has conducted over 800 television, radio and print interviews on a multitude of financial literacy topics. Her mission is to help Canadians feel good about their money.



The information provided in this video and on Kelley Keehn's page on chartwell.com is for informational purposes only. It should not be considered legal or financial advice. You should consult with your own legal, tax and/or a qualified financial professional to determine what may be best for your individual needs. The views, thoughts and opinions expressed belong solely to Kelley Keehn, and not necessarily to Chartwell Retirement Residences or its affiliates.