|
COPYRIGHT 2003 Australian Consumers' Association
IN A NUTSHELL
* Don't confuse retirement villages with hostels or nursing homes. Some operators promise guaranteed access to such aged care services--a promise they often can't deliver.
* 'Departure fees' payable when you leave some villages are barely short of scandalous. Leaving can have a significant financial impact and limit your future choices for care and accommodation.
* Moving into a retirement village should never be seen as an investment. In fact, it can be a very costly exercise.
The financial aspects of retirement village life are complicated, with many pitfalls for the unsuspecting. Laws vary from state to state and contracts and legal structures can vary from village to village. Ongoing fees can be significant, and those that apply when you leave a village can be particularly steep.
We're sure there are many happy retirement village residents throughout Australia, but our research indicates that a lot of residents become disappointed with their decision to move to a village. State government departments responsible for regulating retirement villages assure us they don't receive a large number of complaints from residents, but we've found strong examples of retirement village owners:
* Failing to properly inform current and prospective residents about their rights under state retirement village and contract laws.
* Failing to provide promised services and facilities.
In spite of state laws covering retirement villages, it's up to the consumer to look beyond the advertising promises and get the information to make a fully informed financial decision. Make sure you understand the long-term financial implications of your contract, and that everything you're told about services and fees is given to you in writing.
IT'S A BUSINESS
Retirement villages are a large and growing industry. In NSW alone there are around 35,000 residents living in about 700 villages.
Villages can be operated by private for-profit companies or community-based organisations like churches, service clubs and local governments. Private, for-profit villages are resident-funded. Residents pay the full cost of the buildings, management, maintenance and day-to-day running of the village.
Many not-for-profit villages operate on a similar resident-funded basis to private-sector villages and make a surplus (profit) from property sales. However, they're more likely to offer special deals for people who can't afford high entry costs and may use surpluses to subsidise other charitable activities.
Some of the CHOICE subscribers who wrote to us about their retirement village experiences had less than flattering things to say about their village owners and operators:
"Operators of retirement villages have a licence to print money and the lack of 'people skills' by management is evident. All is sweetness and light until you move into the village, then if you question or disagree with management you're treated with contempt, classed as a troublemaker and told if you're not happy you're free to move."--NL, NSW.
Poor communication, a lack of management and financial skills and inexperience with caring for or dealing with the elderly were common problems identified by the residents who wrote to us. Others made allegations about intimidation and harassment of elderly occupants by some village operators.
One resident cautions: "Keep in mind that the owners of the village may appear to be friendly and helpful but they are, in fact, businessmen and their concern is for their business, not you."--NM, Qld.
SHOP AROUND
It's essential to examine what's on offer at a number of villages to ensure you end up with the best possible value for money.
Depending on which state you live in, you should receive certain information upfront, including disclosure documents that set out services, facilities, conditions of entry and fees. You should also be given an advance copy of the contract and any agreements relating to management, ongoing fees and laws governing retirement villages. Villages accredited under the Retirement Village Association's national scheme (see above) should definitely provide this information. It's well worth consulting a lawyer with retirement village experience for help understanding it.
Accommodation can vary from opulent villas to basic single-room apartments. Common facilities and services for residents also vary significantly. Make a list of what you want and decide how much you can afford to pay before you start looking.
When you visit a village, inspect the particular unit or villa, the entire village and the surrounding area....
Read the full article for free courtesy of your local library.
|
Bookmark this article
Print this article
Link to this article
Email this article
Digg It!
Add to del.icio.us
RSS
