Most of us nearing retirement want to know if the money we’ve saved will cover our expenses through the end of our lives. Will inflation and the rising cost of assisted living outpace your post-retirement income?
Inflation increased 5% from 2011-2014. How does that stack up to the creeping prices of senior housing? A Place for Mom gathered actual consumer transactions to graph trends in senior housing prices from 2011-2014 to determine how quickly prices are rising.
Why does our Senior Living Price Index report higher assisted living prices than three alternative sources? That’s because the Senior Living Price Index is based on what families actually paid – we gathered real transactions in our index. Real transactions take into account the usual negotiated monthly fees, like care services, room type, occupancy rates, and amenities.
Other organizations, such as John Hancock and MetLife, who regularly report senior care costs, base their data on self-reported standard rates from assisted living communities.
Note that independent living only includes rent and other recurring monthly charges, whereas assisted living and memory care prices include the resident’s assessed care charges in addition to rent and other recurring monthly charges. There is more in-depth information about A Place For Mom’s price index data here.
As we age, our care needs change. Independent living is still an affordable type of senior housing. However, it’s wise to have a financial plan that includes the increased care we’re likely to need from assisted living or memory care.
Do you have a post-retirement financial plan? Tell us what you’re doing to afford housing and medical costs in your senior years.