There's no place to retire like home.

Instead of migrating to traditional retirement areas, many aging Americans are choosing to remain nearer to where they worked. The immobility of certain health care plans, rising health care costs and decreasing retirement budgets are keeping retirees closer to home.

And as the baby boom generation grows older, this phenomenon is expected to increase, and it is already changing the way retirement housing is marketed and built.

"Given their druthers, older people want to stay put and age in place," says Tom Otwell, spokesman with the AARP, a service organization for the elderly. He cites a recent AARP study in which 83% of those over age 45 said they would like to stay in their current residence for as long as possible.

Only 4.2% of households headed by those older than age 65 moved between 1998 and 1999, according to the most recent statistics available from the Administration on Aging. In comparison, 16.5% of those households headed by people younger than age 65 changed location during the same period.

As a result, many states are seeing rapid increases in their elderly populations. "We'll see, in the next five to 10 years, a pretty steep increase in nontraditional retirement communities like Michigan or Illinois," says Ken Preede, research director with the American Seniors Housing Association.

In some areas, the increase has already begun, he says. In 14 states, the number of people over the age of 65 increased by more than 20% between 1990 and 2000, according to the U.S. Census. That list included Alaska, Colorado, Delaware, Wyoming, North Carolina, South Carolina and Georgia.

Older Population Not Just Goin' South
West recording surge in residents over age 65
Source: U.S. Census.

"Florida is not the only option," says Rosenthal. "The bottom line overall is that people want to spend their later years in a place they can call home."

Busting Stereotypes

It's time to retire those stereotypes about retirees. Experts say the days of shuffleboard in isolated retirement communities are waning as baby boomers enter retirement.

Two-thirds of Americans who are above age 65 and not living in nursing homes reside with either a spouse or another family member, according to data from the National Council on Aging. If they're not living with their families, they're living nearby. An AARP study of grandparents showed that three-quarters of all grandparents lived within an hour of their grandchildren.

Some retirees even expect their families to move in. One-quarter of boomers say they expect their children or grandchildren to live with them at some point during retirement, according to a poll from homebuilder Del Webb. Some of these retirees find themselves replacing their old jobs with a new one: taking care of their grandchildren. AARP statistics show 11% of retirees are either primary or secondary caregivers. "That's a pretty dramatic statistic," says Denise Snodgrass, assistant director for the North Carolina Center for Creative Retirement. "I don't think you'll see that group of people moving."

More Retirees Staying Put

Restrictions on health care plans also keep retirees aging in place. "I hear people say, 'I'd really like to move, but because of my retirement, I'm in such-and-such health plan and it's not in the area,'" Snodgrass says. These retirees prefer to stay near the doctors who have been treating them for years. Though Medicare is a national program, Snodgrass says, not all doctors take on Medicare patients. And rising health care costs can make paying out of pocket for a doctor prohibitively expensive, especially for poorer retirees.

For those elderly who become seriously ill, the increased availability of home care is making it possible to receive treatment without moving. "The old paradigm was that we get old, get sick, go to a nursing home and die. But if they need some medical care at home, there's an increasing number of providers who can do that for them," says Bruce Rosenthal, director of media relations for the American Association of Homes and Services for the Aging.

Some baby boomers plan to stay close to where they worked simply because they want to continue those jobs on a part-time basis, says J. Walker Smith, president of Yankelovich Partners, a lifestyle trends tracker. "There is a connection to work as an activity that boomers have, irrespective of economic necessity," he says.

Indeed, according to a study from the AARP, 80% of boomers said they planned to work at some point during retirement. A separate study from Del Webb showed that 61% of boomers aged 48 to 52 said they planned to work at least 20 hours a week during retirement.

Staying put also has economic advantages. "The house is paid for. You know where the best dry cleaner is. You don't need to buy a new car or learn a new city," Smith says. "There's always a hidden cost to moving."

All Together Now

In an effort to tap the age-in-place market, homebuilders are creating new kinds of houses and complexes to accommodate extended families. In the summer of 2002, Del Webb will open Falls Run at Fredericksburg, Va., just 50 miles south of Washington. Falls Run, which offers 576 single-family homes along with amenities such as a recreation center, ballroom and year-round pool is Del Webb's first in the D.C. area.

"We see an opportunity," says Valerie Dolenga, a spokesperson for Del Webb. " Retirees are looking at moving within a 50-mile radius and staying close to their social network. That's why we're looking at communities like Fredericksburg. You've got to go where the active adults are."

Falls Run is a departure for Del Webb, not only because of its location but also because of its size. The community is much smaller than the sprawling Arizona active-adult retirement communities it began building in 1960. The company plans to expand the Falls Run concept in the coming years, targeting Denver, Seattle, Massachusetts and New Jersey. "They're not just going to Vegas," she says.

To capitalize on the desire of families to stay together, builders now offer multigenerational housing -- communities that combine age-restricted retirement housing with regular housing. "The concept is to build communities for people of all ages. This is not at all a retirement community," says Jacque Pertoulakis, director of public affairs for Anthem, Del Webb's multigenerational housing complex in Phoenix, Ariz.

Instead of separate houses in the same complex, some families are searching for larger houses. "The majority of our multigenerational homes are two and three bedrooms. Our average home is between 1,800 and 2,800 square feet," says Michael Villane, vice president for Hovnanian Enterprises, which has retirement communities in 11 states, including more than three dozen in New Jersey.

The City and College

Retiring in place isn't just a suburban phenomenon. Senior Lifestyle Corporation has been targeting Chicago's urban retirees for more than 15 years at its signature property, the Breakers at Edgewater Beach. The towering apartment building sits on the Windy City's waterfront. "Approximately 90% of our residents at Breakers have lived within 10 miles of the community for the majority of their lives," says Bonni Kaplan, director of marketing for the company.

Senior Lifestyle has supplemented the Breakers with Senior Suites, smaller urban retirement centers with 90 studio and one-bedroom apartments available for those older than age 62.

Those who loved college can return; retirement communities are springing up outside college campuses. "We've attracted folks who are very keen on that sense of lifelong learning," says Bill Silbert, director of marketing for the Kendal Corp., a not-for-profit builder and operator of continuing-care retirement communities.

Kendal has developments in Hanover, N.H., home of Dartmouth College; Ithaca, N.Y., home of Cornell; and Lexington, Va., home of Washington and Lee University. Other builders are erecting structures near Penn State, the University of Michigan, Notre Dame, Duke University and the University of Pennsylvania.

At nearby colleges, college-bound retirees can audit classes, listen to faculty lectures and even take classes created specifically for them. Silbert says, "It's important for retirees to see they can continue to find an opportunity for growth."

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