The Retirees Who Left a Big 55+ Community Nearly All Ended Up in the Same Kind of Place
Most retirees plan for one move, not two, and the second one comes with a price tag and a financial structure unlike anything they budgeted for in their 60s.
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It’s pretty common for couples to make two moves in retirement. In their 60s, they buy into a 55+ community with golf courses, pools, and clubhouse activities. In their late 70s, they sell and move again, usually to somewhere smaller, close to an adult child and near a major hospital. Often that place is a life plan community, also called a continuing care retirement community (CCRC), where care is available on the same campus. This article covers what that second move costs and the portfolio size needed to support it.
The first move usually centers on lifestyle and taxes. One couple featured by the Wall Street Journal moved to a 55-plus community in Reno in 2019. Their spending fell to about $75,000 from around $100,000, mostly because of lower taxes. Local real estate agents call the version of this move that follows grandchildren the “Baby-Chaser” migration.
Why Amenity Communities Stop Fitting in the Late 70s
A large 55+ community is designed for people who drive and host guests. As driving gets harder, amenities spread across miles become harder to use. A life plan community puts meals, housekeeping, and several levels of care in one place. Genworth survey figures put the national median for an independent living one-bedroom at roughly $3,000 a month, compared with $5,500 for assisted living and $8,000 for a private nursing home room. Entry fees at CCRCs run from $50,000 to over $500,000.
What a Couple Actually Spends After the Second Move
The monthly fee covers meals, utilities, maintenance, and housekeeping. A couple’s budget looks like this:
| Line item | Annual cost |
|---|---|
| CCRC fee ($4,000 base plus second-person fee) | $60,000 |
| Medicare Part B, two people at $202.90/month | $4,870 |
| Medigap and Part D (assumption) | $6,000 |
| One car, insurance, fuel (assumption) | $6,000 |
| Travel, gifts, extra meals, reserves (assumption) | $12,000 |
| Income taxes on withdrawals (assumption) | $8,000 |
| Total | about $96,900 |
The second-person charge usually runs $500 to $1,500 a month. This budget uses the middle of that range. The total is roughly $21,900 more than the Reno couple’s $75,000, mostly paying for guaranteed access to care.
Turning That Budget Into a Portfolio Number
If each spouse collects the average retired-worker benefit of $2,071 a month, Social Security brings in $49,704 a year. That leaves a gap of about $47,200. Covering the gap at a 4% withdrawal rate takes about $1.18 million. At a 4.5% rate, the target falls to about $1.05 million. CCRC fees also rise each year, while the 2027 COLA is currently tracking at 3.3%. When one spouse delays taking, the higher check becomes the survivor benefit, and the second-person fee drops away when one spouse dies.
The entry fee usually comes from selling the house. In its latest reading, the Case-Shiller national index hit 336.663, the highest in the past year of data. That makes it realistic to fund a $250,000 entry fee from home equity. Adding that fee to the invested target brings total assets needed to about $1.43 million.
A Tax Deduction and a Refund Choice Most Buyers Miss
Part of a CCRC entry fee and monthly fees can count as prepaid medical care. Each year the community reports what percentage of fees is attributable to care. Couples who itemize and clear the 7.5% of income floor for medical expenses can deduct that share. The move-in year matters most, as a large IRA withdrawal taken to pay the entry fee can be partly offset by the medical deduction on that same fee.
The refund structure also changes the real cost. A $250,000 entry fee that is 50% refundable, plus $4,000 a month for ten years, has an effective cost of about $5,083 a month. Fully refundable contracts keep more money for heirs but charge higher monthly fees. Nonrefundable contracts carry the lowest monthly fees but hand the entire entry fee to the community.
What It Takes
A couple receiving two typical Social Security checks needs roughly $1.05 million to $1.18 million invested, drawn at 4% to 4.5%, plus about $250,000 in home equity for the entry fee. Coordinating the medical deduction with IRA withdrawals and choosing the refund structure can change the true cost of the move more than any single line in the budget. The 4% figure itself is worth pressure-testing before leaning on it, which is the whole argument in our free income-first retirement guide.
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David Beren has been a Flywheel Publishing contributor since 2022. Writing for 24/7 Wall St. since 2023, David loves to write about topics of all shapes and sizes. As a technology expert, David focuses heavily on consumer electronics brands, automobiles, and general technology. He has previously written for LifeWire, formerly About.com. As a part-time freelance writer, David’s “day job” has been working on and leading social media for multiple Fortune 100 brands. David loves the flexibility of this field and its ability to reach customers exactly where they like to spend their time. Additionally, David previously published his own blog, TmoNews.com, which reached 3 million readers in its first year. In addition to freelance and social media work, David loves to spend time with his family and children and relive the glory days of video game consoles by playing any retro game console he can get his hands on.
