Are you an older homeowner who wants to age in place and find new ways to earn money in retirement?
Well, you’re not alone. A new study released by Silvernest found an increased interest in home sharing among older homeowners as a means to generate passive income, gain companionship and chore sharing, and age in place.
Why the interest in home sharing? In short, a desire for income. According to the study, nearly half (49%) of those surveyed are worried they don’t have enough money or know they don’t have enough set aside for retirement. And women are particularly uneasy about their retirement readiness, with 53% worried or unsure about their finances, compared to 43% of men.
Given this worry, it’s not surprising that older homeowners are looking for new ways to earn income in retirement. In fact, 71% of those surveyed are currently looking for new ways to earn income in retirement to pay for general living expenses and pay bills. And 37% of retired respondents said they are working part time, signaling a need for new/creative income opportunities, according to the survey.
So, who do older homeowners want to share their homes with? A large majority are open to home sharing with nurses, teachers, essential workers and/or service year members.
The study found that 88% of those surveyed (homeowners ages 55-85) reported that they'd like to remain in their homes as long as possible as they age, a finding consistent with research by AARP. However, most respondents don't feel equipped to do so; only 25% feel they and their homes are ready for aging in place. And, not surprisingly, the Silvernest survey showed nearly all older homeowners surveyed (98%) said creative, aging-friendly living options are desperately needed.
What do experts say about the research?
Carolyn Rosenblatt, a partner in AgingParents.com and AgingInvestor.com, as well as the co-author of Hidden Truths About Retirement & Long Term Care, said a “scary” number of people do not have enough saved for retirement and that's not just about maintaining one's lifestyle.
“Very few, except the wealthiest, consider how costly it is when they lose independence,” she said. “Most people who live into their 80s, 90s and beyond will need help at some point. But people do not wish to consider this. They think it won't happen to them. The cost of staying at home with help, which most think is best for them, is extremely expensive.” (Read: Genworth Cost of Care Survey.)
Where will care be delivered if needed? It’s one thing to age in place. It’s a whole ’nother thing to consider where care can be delivered if needed. “The choices are to get any needed assistance in that home when the need arises, or go elsewhere to receive it,” said Rosenblatt.
Most older homeowners don’t consider assisted living to be something they want. “If they have family they expect family to take care of them,” she said. “But we meet many people in our work who are not willing to take in Mom or Dad -- too much trouble, difficult relationships, not close to the parent. On the other hand, those who do take in the aging parents have a solution that offers the best financial outcome. The cost of living and care are shared. Some find this very satisfying. We do not have data on the success rate of these arrangements. We do see an indication that not everyone wants it in the proliferation of assisted living facilities and memory care facilities being constructed.”
Of note, the Silvernest research showed that 85% of older homeowners have some form of social support nearby. And of those, 66% have adult children, and 65% have friends and neighbors nearby and less than 25% report having a faith-based or non-faith-based local social community as a source of social support available to them.
As for shared housing, Rosenblatt said models exist aplenty in other countries but it’s far from certain that it will take off in the U.S. “Different cultures are a factor in the success of these models,” she said.
The problem with shared housing in the U.S., according to Rosenblatt, is this: There are always far more home seekers than there are elders actually willing to rent out a room to anyone else. “Many older retired folks live alone, unwilling to give up their privacy or to even admit that living alone is less than ideal for them,” she said. “Bottom line: There is considerable resistance to what seems on its face like a good idea.”
Rosenblatt also sees, as the Silvernest research showed, many people working in retirement years. “Jobs are plentiful and there is a labor shortage,” she said. “Sometimes we see older folks working at a big box store or fast-food establishment. People are doing this mainly because they need the money. Some tell us they need something to do even if money is not the primary reason.”
The Silvernest research showed that 31% of homeowners want to live in a "village" community with shared services as they age. “The Village concept, originating with Beacon Hill, has become a national model,” said Rosenblatt. “Shared resources are an objective. The idea has many forms, some loose and some more controlled by an organization. People like the notion of aging in place at home and using help their neighbors use as a community. That works fine until a person may need full-time care at home. That cost comes out of pocket and is not shared. Again, no one wants to think of needing full-time care at home or anywhere. But with longevity, dementia, multiple chronic illnesses, it is a reality.”