How Financial Advisors are Negotiating CCRC Contracts

Members | June 10, 2012

Financial advisors don’t just manage an older adult’s investments anymore. Now they’re negotiating CCRC contracts.

The next time a prospective resident comes to visit your continuing care retirement community (CCRC), he or she may be accompanied by someone other than a family member. That tag-along friend could very well be a financial advisor intent on negotiating the best deal possible for a grateful client.

According to The Wall Street Journal, more and more retirement community shoppers are seeking help from wealth-management firms. Those firms are negotiating prices and amenities with a single CCRC. They’re playing off one CCRC against another to get the best overall deal for a client. And, they’re trying to help protect their clients’ assets in the event a CCRC seeks bankruptcy protection.  

Impressive Discounts

Whatever their motivation, financial advisors are acquiring impressive discounts for their clients. In one example, a 90-year-old widow in Philadelphia saved 35% of a CCRC’s costs when her advisor negotiated an entrance-fee discount, 2 months of free rent, a monthly rent discount of $500 for 6 months and a $2,000 moving allowance. In other instances, financial advisors were able to get their clients: 

  • A free golf cart for life, including ongoing maintenance and replacement if necessary.
  • A new dishwasher and a fancy stove for a client who loves to cook.
  • A plan to coordinate in-home services so a client could avoid a move to a more expensive level of care.

Experts cited by The Journal suggest that the real-estate downturn is giving retirees more leverage as CCRCs face diminished waiting lists at a time when they need to stay full in order to fund operations, build reserves and finance refunds.