Don’t DIY These Decisions
Buying into a retirement community usually means crossing state lines, which introduces a web of complex tax and healthcare changes. Treat this move as a major financial transition, not just a real estate transaction.
Work with a Medicare Specialist: Moving out of your current ZIP code triggers a Special Enrollment Period for Medicare. Your current Medicare Advantage plan or Part D prescription drug plan likely will not move with you. Network coverage changes drastically from state to state. Before you finalize a move, use the Medicare Plan Finder to ensure your preferred doctors and necessary medications are covered in your new neighborhood. Alternatively, contact a local SHIP (State Health Insurance Assistance Program) counselor in your destination state for free, unbiased guidance.
Consult a Financial Advisor: Selling a long-held primary residence can trigger capital gains taxes if the profit exceeds federal exclusion limits. Furthermore, moving to a state like Florida or Tennessee eliminates state income tax, but those states often recoup revenue through higher sales taxes or unique property tax assessments. A fiduciary financial advisor can help you model your cash flow to ensure the resort lifestyle remains affordable throughout your lifespan.
Frequently Asked Questions About Retirement Villages
Are children and grandchildren allowed to visit a 55+ community?
Yes. The Fair Housing Act requires that at least 80% of the occupied units in a 55+ community have at least one person who is 55 or older. While this prevents young families from buying homes there, visitors are absolutely welcome. However, most HOAs limit how long minors can stay—typically between 30 and 90 days per calendar year. Check the specific bylaws of your target community.
Do I actually own the land in a 55+ community?
In most modern master-planned developments, you purchase the home and the lot it sits on (fee simple ownership). However, in some older communities, particularly those featuring manufactured homes or cooperative apartments (like parts of Rossmoor), you may own the structure but lease the land, or you may purchase shares in a corporation that grants you the right to occupy the unit. Always clarify the ownership structure with a real estate attorney.
What happens if my spouse is over 55 but I am not?
As long as one occupant of the home is 55 or older, the household generally meets the legal requirement for residency. If the older spouse passes away, most communities have provisions allowing the underage surviving spouse to remain in the home, provided the community does not drop below the federal 80% threshold.
