When you hear that someone is going to retire, it’s easy to conclude they will be leaving their employment, no longer working, and withdrawing from the workforce. That is, after all, the most common definition of retirement.
But another definition for the word “retire” is “to move back.”
Maybe that explains why more and more retirees are moving back to college towns … communities that are active, intellectually stimulating, diverse, filled with arts and entertainment, and constantly changing while maintaining important traditions.
Most college towns are tailor-made for easy access and proximity to anything and everything we humans enjoy. There are restaurants, bars and coffee houses, live music, theatre, sporting events, libraries, health care facilities — endless activities and amenities offered at all hours of the day.
Not Your Typical Senior Community
As we live, work and learn longer, it makes sense that many of us are drawn to communities that feed our intellect and nurture our soul while offering sought-after lifestyle options and affordability.
UBRCs (University Based Retirement Communities) have taken this idea to an entirely different level by combining senior-friendly housing, mentoring and volunteer activities that leverage career experience and expertise, non-credit courses at no cost, and access to a continuum of health care for an aging constituency.
While UBRCs are far from the norm (just over 100 at the last formal count) and perhaps a bit pricier, almost all college communities have less structured advantages for retirees along the same lines. Imagine encouraging your clients to take a “gap year” during retirement by exchanging their home (check out SabbaticalHomes.com) or housesitting in an American college town. Another option: Living within walking distance of a university located in country they’ve always dreamed of visiting!
Let’s not forget that most U.S. college towns have a lower cost of living because they are built around students (known for having very little or no income) who get pretty creative about stretching a dollar for food, clothing and shelter.
The Math Test
Most UBRC housing mimics the hybrid payment model of traditional retirement communities that offer increasing support through the phases of aging. Monthly fees run along the lines of a rental ($3,000 to $5,000 range) but typically require a substantial buy-in fee ($200,000+). The significant upfront fee is designed to be used for costs associated with higher levels of care as the resident progresses through the various phases of support required. And most programs refund any unused funds to designated beneficiaries.
Mirabella at Arizona State University is a newer offering with buy-in rates of between $378,500 and $810,200, depending on the size of the living unit and number of bedrooms. Monthly fees ranging from $4200 to $5600 cover utilities, housekeeping, four restaurants for dining, plus a health club and indoor pool.
Floors are separated depending on the level of care needed (assisted living, memory care and skilled nursing). Included in the price are classes (audited, not for credit) and access to the university library.
When a resident passes away, 85% to 90% of the unspent funds are refunded (or a resident can select an option for lower initial and monthly fees with no refund). The ASU project is completely sold out; there are similar offerings in Florida and Massachusetts.
Undoubtedly, more communities like this will be built as demographics and demand continue to suggest a willingness for this intentional approach to phasing gracefully into the final phase of life.
Long-Term Plans
In many ways, UBRCs are a viable long-term care strategy for clients that can make the buy-in and “pay as you go” for increasing assistance. The monthly fees are on par or less than the rates for assisted living facilities that offer less amenities and a lot less energy and excitement than a college campus.
Imagine a client selling a home after living there for decades, using some of the proceeds to make the upfront buy-in, and then settling into a vibrant community that is structured to let her “age in place.” This is a decidedly intentional approach to the inevitabilities of not only growing older but perhaps much wiser.
These are the lifestyle choices today’s retirees want to explore and enjoy while living, learning, and making the most of the good planning that we’ve painstakingly put in place during their years of accumulating and protecting wealth.
Beth V. Walker is a wealth advisor with Carson Wealth Management and founder of Center for College Solutions, which is based in Colorado Springs, Colo. She can be reached at bwalker@carsonwealth.com or 719-522-2278.
