Retirement is a significant milestone in life, and choosing the right retirement village is an important decision. One crucial aspect to consider when buying into a retirement village is understanding the costs and fees involved. In this article, we will shed light on the fees you may encounter when purchasing a retirement village property on the Gold Coast, specifically at Serene Living.
The cost before you move in
Before transitioning to retirement living, it’s important to grasp the various components of retirement village entry fees or entry payments. These may encompass:
- Purchase Price: In specific retirement villages, residents acquire their retirement village unit or apartment, akin to buying a property. Conversely, in some cases, you’re securing the right to occupy without ownership.
- Refundable Deposit: Certain villages necessitate a refundable deposit upon moving in. This deposit is generally reimbursed to residents or their estate upon departure.
- Ingoing Contribution: A lump sum payment made by the resident at entry, the ingoing contribution is intended to encompass accommodation expenses and communal facilities/services.
- Service Fee: As part of the entry cost, certain retirement villages include a service fee. This fee caters to resident services, maintenance, repairs, and insurance.
Deferred Management Fees (DMF):
One of the common fees associated with retirement village living is the Deferred Management Fee (DMF). The DMF allows you to defer payment of management fees until after you leave the village, which can make the upfront cost of buying into the village more affordable. The amount of DMF you pay upon leaving the village depends on various factors, including the price of your home, the duration of your stay, and whether you choose to share in any capital gains. It is essential to understand the specific terms and calculations of the DMF at Serene Living to make an informed decision.
Cost of Living at the Village:
Apart from the upfront cost and the DMF, it’s important to consider the ongoing costs of living at the retirement village. Serene Living, like many other retirement villages, charges a weekly maintenance fee. This fee covers expenses such as council and water rates, building insurance, general facilities and grounds maintenance, and 24-hour emergency response. However, it’s important to review the breakdown of the maintenance fee to understand exactly what is included and whether it represents good value for the services provided.
Exit fees are another aspect to consider when buying into a retirement village. These fees are typically associated with the sale of your village apartment when you decide to leave. At Serene Living, the exit fee is referred to as the Deferred Management Fee (DMF). The DMF is calculated based on factors such as the tenure and resale value of your unit. The specific percentages and conditions for the DMF at Serene Living can be found in the example provided.
It’s important to distinguish the deferred management fee (DMF) from other contract options available at retirement villages. Serene Living, for example, offers multiple contract options to suit different circumstances. These options include a prepaid plan, refundable contribution, and pay-as-you-go, each with its own advantages and considerations. It’s crucial to explore these options and consult with the sales team at Serene Living to determine which contract option aligns best with your financial and lifestyle needs.
Remember to seek independent financial advice from professionals, or even legal advice, to ensure you fully understand the financial implications and make the right choice for your retirement journey. It’s essential to have access to all relevant contractual documentation and fee details before making any commitment. Unfortunately, some operators may not readily provide this information, which is why it’s crucial to avoid dealing with such operators. Seek out retirement villages that prioritize transparency and readily provide comprehensive information about fees and contracts.
Get in touch!
Buying into a retirement village is a big financial decision and should involve an understanding of the costs and fees associated with the purchase. At Serene Living on the Gold Coast, there are deferred management fees (DMF) to consider, along with ongoing costs of living at the village and potential exit fees. By carefully reviewing the terms, calculating potential costs, and exploring the various contract options available, you can make an informed decision that aligns with your financial goals and lifestyle preferences.
If you are interested in retiring on the Gold Coast, Serene Living is located on the southern end of the sunny Gold Coast and Northern NSW in Tweed Heads, opposite the Tweed Heads Bowls Club greens. Our location is at 31 Florence Street on the corner of Powell Street, Tweed Heads.