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5 Affordable Housing Options for Seniors

Maryalene LaPonsie

Retirement brings with it many changes. Your income may be reduced, and your lifestyle may evolve as well. The big house where you raised kids may no longer fit your needs or your budget.

Affordable housing for seniors comes in many shapes and sizes. If you're ready to move someplace new, here are five financially savvy options.

[See: 10 Ways to Reduce Your Housing Costs in Retirement.]

Move in with the kids. Although certainly not for everyone, moving in with an adult child -- or having them move in with you -- can be a win-win. It can immediately slash living expenses in half. Plus, there's the possibility of fringe benefits for both parties. Busy parents may end up with built-in babysitting, while seniors, particularly those who are single, benefit from an active household that will stave off loneliness and the health risks linked to it.

The key to making these arrangements work is to set clear guidelines from the start. Make sure everyone has the same expectations about communal living, personal space and bill sharing.

Share your house with another senior. If you'd rather not live with a family member, consider renting out space with another senior. Home sharing with another retiree provides similar financial benefits without the complicated relationship dynamics that can come along with moving in with the kids.

Seniors who still own a home could find a housemate covers much of their living expenses, and renters can halve their monthly bills. Wendi Burkhardt, CEO and co-founder of Silvernest, a website that connects seniors who want to share a home, estimates it costs $1,500 a month to rent an average one-bedroom apartment in Denver. However, someone renting through a house-sharing arrangement could be paying only $750 a month.

[See: 10 Tips for Finding a Great Place to Retire.]

Look into subsidized housing programs. There are a number of different federal housing programs that can help subsidize or stabilize the rents of seniors. "At the state and city level there are a bunch of different programs as well," says Amy McDonald, a licensed real estate salesperson with Triplemint in New York City.

However, subsidized housing programs at all levels can be complex to navigate. Each may have its own eligibility criteria and application process. "The systems can be complicated and feel daunting," McDonald says. Even if you think it will be years before you need subsidized housing, McDonald suggests meeting with a housing counselor through the Department of Housing and Urban Development or a local nonprofit sooner rather than later. "Begin to apply now, because most of the programs do have waiting lists," she says.

Consider a co-housing community. Co-housing communities are a lesser-known option for reining in housing costs. While not all co-housing developments are affordable -- indeed, some are anything but -- some are set up to include lower-cost units.

"I hate to use this word, but it's like a commune," says Victor Medina, a certified financial planner and attorney for Medina Law Group in Pennington, New Jersey. The communities feature homes clustered around communal spaces. Depending on the community, members may provide meals, housekeeping or transportation services to others in the neighborhood. Having this type of living arrangement allows seniors to remain largely independent while still getting basic assistance when needed. "It allows them to age gracefully," Medina says.

[See: 10 Places to Retire on a Social Security Budget.]

Sign a contract with a Life Plan Community. On the face of it, a Life Plan Community does not seem like an affordable housing option for seniors. Certainly, it isn't an option for anyone who doesn't have access to a significant amount of cash to pay the initial entrance fee. However, for those who might need skilled nursing care in the future, a Life Plan Community can be an affordable choice in the long run.

Life Plan Communities combine several living arrangements on a single campus to allow seniors to move from independent living to assisted living to skilled nursing care, if needed. Some communities are all-inclusive and include meals as well as other activities.

While these communities offer several contract options, the highest level typically guarantees care at a fixed rate. If a resident reaches the point where they can no longer afford that rate, some communities have foundations or assistance programs to cover the cost. Since contracts and services can vary, read the fine print carefully before signing.

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