Having It All : Adult Communities: The Action Continues After Retirement

Louis Masten gets more out of life in a single day than many people half his age get out of a month.

If you can’t find the spry, 74-year-old retired hospital administrator on the well-manicured golf course at his home in a Menifee retirement complex, you might catch him at one of the dinners or dances that residents of the project sponsor at their sprawling recreation center.

His wife, Phyllis, splits her time between the golf course, bridge group and the women’s club when she’s not working as a volunteer at the local hospital.

“We figured that we could move to a place where everybody was active, or we could sit someplace and wait for the Grim Reaper,” Louis Masten said from his home at Palmilla on the Green, a 273-unit “active-adult” Riverside County retirement complex built by Bramalea California Inc.

“We moved here, and we’ve never regretted our choice.”

Indeed, so-called “active-adult” communities--the Leisure Worlds, Sun Cit ies and other projects geared toward healthy retirees--can be paradise for those who want to spend their time golfing, playing tennis or taking part in other on-site activities ranging from social clubs to art classes.

But seniors who purchase a home in a development without some thoughtful planning may see their dream of a glorious retirement turn into a nightmare.

“If you want to get the most out of your retirement, you’ve got to do some homework first,” said Leah Dobkin, a housing specialist with the American Assn. of Retired Persons.

“People who don’t do some advance planning often wind up being sorry.”

Seniors who are pondering a move to a retirement community should first consider their medical needs.

Most active-adult communities offer little in the way of medical services. If you need constant medical attention or your health is deteriorating, you might be better off moving to a nursing home or congregate-care facility that can give you the ongoing care you need.

Even if you’re in good shape now, you need to think about how you’ll feel 10, 20, perhaps even 30 or 40 years from today.

“Too many older people don’t pay enough attention to a development’s medical services,” Dobkin said. “They get carried away looking at the golf courses and pools, and they forget that one day they’ll probably need more comprehensive medical help.”

As a result, Dobkin said, “make sure your project either has good medical services on-site or at least nearby. Chances are, you’re going to need them one day.”

There are psychological considerations too.

If you’ve been living in a single-family home, you might have problems adjusting to the rules and regulations that accompany life in a retirement complex.

Most developments have codes that govern a variety of items, from what color you can paint your home to how long your guests can stay.

If you’re thinking of moving to a community that’s out of state, you might also have to adjust to seeing your family and longtime friends less often.

“A lot of people retire just because they want to spend more time with their family and friends,” Dobkin said. “You can’t do that when they’re all thousands of miles away.”

Should a faraway retirement spot still beckon, you’ll want to visit the area at least twice--once in the winter and once in the summer.

“Making several visits gives you a chance to see what the area is like year-round,” said Del Webb Corp. Chairman Phil Dion, whose company pioneered the active-adult retirement concept when it began building Sun City on the outskirts of Phoenix three decades ago.

“The more you know about the climate, the better.”

Many developers of retirement communities offer special vacation packages that let would-be buyers spend days or even weeks in their proposed retirement spot.

“You can’t get a good idea of what life would be like in your new home just by visiting a sales office and touring model homes for a few hours,” Dion said. “Take the time to investigate the area first.”

There’s another advantage to visiting your proposed retirement spot often. “You’ll have more time to check out all the developments in the area instead of just a few,” said Leisure Technology Inc. Chairman Michael L. Tenzer, who has built Leisure Villages across the U.S.

Compare the amenities and services that each development offers.

“Pay especially close attention to the items that are most important to you,” advises Stan Ross, co-managing partner of the real estate consulting firm of Kenneth Leventhal & Co.

“If you’re a golfer, you’ll want to make sure that the course is in excellent shape. If you’re into tennis, make sure the court is well-kept and that you don’t have to wait for hours in order to play.

“Or if you’re just into socializing, see if there are regularly scheduled social events, like picnics or dances.”

Once you’ve narrowed your choices to two or three communities, you’ll want to check out the developer of each complex. It’s a difficult task, but one that’s not impossible.

If the company is publicly held--meaning that its stock is traded on the New York Stock Exchange or other market--ask for a copy of the firm’s annual report to shareholders or the detailed “10-K” report it must file each year with the Securities and Exchange Commission.

If either report makes you wonder about the company’s track record or financial stability, have an attorney or accountant render an opinion. Or simply look for a development by a builder that makes you feel more secure.

Check the state’s Department of Real Estate and other regulatory agencies to see if any complaints have been filed against the developer of the project. Also contact the local Better Business Bureau.

You can feel fairly confident about buying a home from a builder who hasn’t drawn many formal complaints and has cleared up any problems quickly. Be wary of a developer who has a long list of dissatisfied customers.

Above all, make sure you talk to people who already own a home in the development that you’re considering and try to contact retirees who have bought a house or condo in a complex that the same builder previously erected.

“You’ll learn more about the project by just talking with residents for a few minutes than any salesman could tell you in two hours,” said Dobkin at the AARP.

When you’re seeking out homeowners, don’t depend entirely on the list of references that the sales representatives give you. After all, their job is to sell you a home in the complex: It wouldn’t make sense for them to provide you with the names of unhappy residents.

Instead, simply strike up conversations with people you meet on the sidewalks, at the recreation room or in the pool.

After you’ve narrowed your choices to one or two developments, you’ll want to take a closer look at the homeowners association itself. Ask for a copy of its bylaws and read it thoroughly to ensure that you’re comfortable with the project’s rules and regulations.

Also, get a copy of the association’s recent financial statements to check out its financial health. If they’re too complicated to understand or something on the balance sheet makes you worry, have an accountant take a look.

“There are only two things that an association can do when it runs into financial trouble,” said Susan Brecht, director of the retirement-housing practice in the Philadelphia office of Laventhol & Horwath, a big real estate consulting firm.

“One is that it can cut back on maintenance and other services,” Brecht said. “The other is that it can raise dues. Neither alternative is very pleasant.”

Dues increases can be especially painful for retirees, Brecht said, because they’re often on a fixed income and can’t depend on modest increases in Social Security benefits to bail them out.

To protect against potentially large increases, Brecht suggests checking the bylaws to see if dues hikes are subject to annual limits or linked to increases in a specified barometer, such as the Consumer Price Index.

The bylaws should also stipulate that one-time “special assessments” should require a majority vote by the homeowners before they can be levied, Brecht said.

Financing your purchase involves special considerations that you wouldn’t have if you were younger.

If you own your current home and are 55 or older, you’re probably eligible for the one-time tax exclusion that lets you keep up to $125,000 in profits from the sale of your current home tax-free.

Although there are a few exceptions, you’re usually able to take this important tax break if the home has been your primary residence for three of the past five years and neither you nor your spouse has used the exclusion in the past.

It might be tempting to pay all cash for your new home in order to live the rest of your life without worrying about making monthly mortgage payments. But think twice: Many financial experts say you should make sure you’ve got plenty of cash in the bank in case you wind up with big hospital bills or suffer some type of financial calamity.

“Older people should have enough money tucked away to meet at least six or 12 months of their ongoing living expenses because they have a much greater chance of winding up in the hospital or facing some other big bill,” said Philip Kavesh of Kavesh & Gau, a Torrance-based firm that specializes in retirement planning.

If you don’t have enough cash to meet these standards, Kavesh recommends putting some of the proceeds from the sale of your current home into a certificate of deposit or other investment that you can easily convert into cash.

“That way, you’ll have something you can fall back on if you get into a financial bind,” he said.

With some careful planning first, your move into a retirement community will leave you worrying more about your weak backhand on the tennis courts than your financial situation at home.

“Life couldn’t be better,” said Nan Gholson, a retiree who spends her time golfing, swimming and taking part in a variety of on-site cultural activities in the Leisure Village complex in Oceanside.

“My only regret is that there’s just so much to do here, there aren’t enough hours in the day to do it all.”

LEARN MORE ABOUT HOUSING OPTIONS There are many agencies that can help you sift through your housing options and address other issues concerning retirement. Here are some of the biggest:

* American Assn. of Homes for the Aging, 1129 20th St. N.W., Suite 400, Washington, D.C. 20036, (202) 296-5960. Offers a variety of publications--some free, some at a cost--to help older people decide which housing alternative is best for them.

* American Assn. of Retired Persons, 1909 K St. N.W., Washington, D.C. 20049, (202) 728-4355. Offers dozens of free publications. Two of its best are “Your Home, Your Choice: A Workbook for Older People” and “Home-Made Money: A Consumer’s Guide to Home-Equity Conversion.”

* American Health Care Assn., 1201 L St. N.W., Washington, D.C. 20005, (202) 842-4444. Provides a free, comprehensive guidebook on selecting a nursing home and other free pamphlets.

* Design for Aging/American Institute of Architects, 1735 New York Ave. N.W., Washington, D.C. 20007, (202) 626-7300. Provides information on floor plans and housing design elements for the elderly.

* National League for Nursing, 350 Hudson St., New York, N.Y. 10014, (212) 989-9393. This nonprofit agency accredits home health-care organizations and sells a variety of books and pamphlets concerning in-home care.

* Each state also has its own agency that addresses a variety of elderly concerns and offers free information. In California, it’s the California Department of Aging, 1600 K St., Sacramento 95814, (916) 322-5290.

U.S. ELDERLY AT A GLANCE Based on a study conducted May 11 to June 11, 1990, by the Marriott Corp., which included in-depth interviews with more than 1,000 Americans over the age of 65.

* Of those over the age of 65, only 11.6% graduated from college, and 4.3% have postgraduate degrees. Only one-half of Americans over 65 have their high school diploma and women (26.7%) are more likely to have graduated than men (23.3%).

* More men (9.3%) have a college degree than women (6%) and men are twice as likely to have postgraduate degrees (6.7% of men to 2.6% of women).

* The vast majority of seniors, 81%, own their own home, while men (89.1%) are more likely to be homeowners than women (75.7%). Over 90% of seniors who are married live in their own home, while only 71% of those widowed or divorced are homeowners. Almost 18% of seniors rent their home or apartment.

* Men (82%) are more likely to be married than women (31.3) when over the age 65. The reason is because women usually outlive their husbands. Over half of the older women (56%) in America are widowed, while only 11% of men survived their spouses.

* Women are three times more likely to be divorced than men (1.2%). Five percent of all seniors are single and never been married.

* Most older Americans say they feel younger than they actually are, in fact, over 70% say they feel an average of 12 years younger. Women (at 13 years) are more likely to feel younger than men (at 11 years), while men (17.8%) were more likely to feel their actual age than women (10.5%).

* Older women differ slightly in how they spend their leisure time from men, ranking hobbies as their first choice (30.5%), then reading (24.1%), followed by sports and recreation activities (13.7%). Men said they spend most of their leisure time doing sports and recreational activities, with hobbies a close second (29.3%), and watching television a distant third (8.9%). Reading ranked fourth for men (7.1%), as is watching television for women (9.2).

* When asked if the “best part of their life was over,” only half of all seniors (52.9) agreed. Seniors living in rural areas were more likely to agree with the statement (62%) than those who lived in metropolitan areas (48.1%).

* Seniors are generally very positive about their lives. The majority of older Americans (52.4) say they are excited about the future, while nearly everyone (96%) replied they are “basically happy people.” Only 60% wished they had accomplished more in their lives, with women (57%) being more content than men (64.5%). Seniors who live in rural areas are also more happy with their accomplishments than those who live in urban areas.

* Almost half of those over 65 feel that society treats seniors poorly.

* One out of four seniors listed having poor health (25.1%) as their greatest fear about growing old, followed by losing their independence (14.6) and having to move into a nursing home (8.1%).

* Women were more concerned about becoming senile and not being able to take care of themselves than men, while men were more afraid of dying than women. Married couples were twice as likely to fear death as those who were widowed, divorced or single.

* Seniors are rather content with the choices they have made in life, with only 30% saying they would choose a new career if they could do it over again.

* More women (13.2%) than men (8.7%) said they would have gotten married or married someone else if they could do it over again. More women than men wished they would have gotten more education.

* The majority of older Americans (73.1%) feel they can rely on their children for help if they need it, but over two-thirds (79%) would rather not live with their children even if they needed to. Seniors in rural areas (76.2%) feel they can rely on their children for help more than their counterparts in metropolitan areas (71.5%).

COST OF LIVING COMPARISON

Compare your present cost of living with that of a retirement community.

Item Present Community Cost Cost Rent or mortgage Homeowners insurance Fire insurance Utilities Repairs/home improvements Taxes/personal and other Grocery and meal expenses Household expenses Household help/cleaning. etc. Car insurance Car upkeep (gas,repairs), transportation Life insurance Medical/physician expenses Medical insurance Lawn service/gardner Medications Clothing Fitness facilities Hairdresser/barber Entertainment/social activities recreation Emergency call service Nursing service/medication management Other Totals