Australia’s leading retirement village operator has unveiled a range of new contract options and guarantees to help better meet consumer needs, including allowing residents to avoid paying exit fees when they leave.
The options have been released by Aveo, which has 30 years’ experience in the Australian retirement living industry and operates over 90 villages across five States.
At these villages, over 55s can continue to live independently and be part of vibrant, social communities with a range of activities, events and services for residents.
New contract options
Aveo has now shaken up the Australian retirement village industry by releasing three payment options to provide additional flexibility and choice for incoming residents. These plans are supported by several new Aveo guarantees to consumers.
According to Aveo’s National Sales Innovation Manager Marilyn Graham, the new options were developed after detailed consumer research.
“We know that an increasing number of Australians are attracted to the retirement village model, where they can continue to live in their own private home but among a like-minded community with the services they need,” Ms Graham said.
We also know, following the research we undertook, that there is no ‘one size fits all’ solution when it comes to paying to live in a retirement village.
“Consumers have very different needs and desires and are keen to understand and explore a range of options.
“As a result, we’ve developed and released new payment options to help ensure that residents have the ability to choose the option which best suits their needs and stage of life.”
About the options
The payment options are known as Now, Later and Bond.
The Now and Bond options allow someone to avoid paying deferred management fees (also known as exit fees) when they leave the village, with a variable upfront cost.
The Later model involves the traditional deferred management fee on departure.
All options include a guarantee that residents will get their money back, if they decide within six months that the village is not for them.
A further guarantee across all options is that residents will be able to understand what their payout will be when they leave the village, and that this payout will be available within three months of departure for the Bond option, and six months for the Now and Later options.
All options also involve an ongoing monthly service fee, which by law can only recoup the expenses involved in running the village, but not make a profit for Aveo. All retirement villages charge these monthly fees.
Ms Graham said an important aspect of all options was that consumers had a guaranteed and timely payment when they left, without the need to find a buyer for their unit.
“We know that our consumers are naturally anxious to avoid unwanted financial stress when it comes time to leave the village, particularly if they need funds to move into aged care,” Ms Graham said.
“We’ve sought to address this through our new guaranteed payout.”
How the options meet different needs
Rachel Lane, author of “Downsizing Made Simple”, said incoming residents should consider discussing the different payment options with a specialist financial adviser.
“There’s a bit to think about like how much money you need now, while you live in the village and later and what the impact will be on your pension, home care costs, cash flow and estate planning,” Ms Lane said.
“For some people they will want to release as much equity from their current home as possible as they have plans to invest it or spend it (or both).
“For some the fact that you can pay more upfront and significantly less later will be appealing.
“The added bonus of paying more now and less later for pensioners is that releasing equity can cause a dramatic drop in pension (more than can be earned from interest on that equity) so these options could also improve their cash flow while they live in the village.
“Others simply don’t want to pay an exit fee and like the certainty of knowing that if they need to make the move into aged care, or if the money is going to their estate, that it will be paid out quickly.
“The three month guaranteed payout on the Bond option is incredibly quick by industry standards where some States have buyback periods of 18 months.
The important thing is to provide choices and let people decide which one will suit them. That’s what Aveo’s new contracts do.
“It’s a big decision and the ramifications can literally be in the hundreds of thousands of dollars, speak to a retirement living and aged care specialist to ensure you make the best decision for you.”
Aveo operates villages across Queensland, NSW, Victoria, South Australia and Tasmania which are home to around 12,000 residents.
There’s a village option available for every downsizer, including low-rise and high-rise projects in a wide range of locations spanning inner city areas, suburban sites and the regions.
In an Aveo retirement village, you may find villas or apartments ranging from one to three bedrooms, with private outdoor areas and parking.
Serviced apartments are sometimes also available where meals are provided and staff are available to look after domestic services.
More recently, Aveo became the first retirement living provider in Australia to formally request employees be vaccinated against COVID-19, to help protect residents.
Aveo has industry-leading consumer sentiment results, with 94 per cent of residents saying they are happy to live in one of the organisation’s villages.
To find out more about Aveo’s retirement villages and the payment plan options, please click here.
This content has been prepared by Downsizing.com.au on behalf of Aveo
Please refer to the contract and disclosure documents for the full terms and conditions of each payment option, including the amounts payable on entry and the money back guarantee if you decide within six months that the community is not right for you. Availability of payment options will depend on the type of community and home chosen and may change without notice.
Furthermore, please note this story has been prepared as a general guide only, and should not be relied upon as a substitute for seeking your own independent legal and financial advice.
Any references or links to third party resources or websites are provided in good faith, but we take no responsibility for their content, and you must rely upon your own enquiries and seek professional advice before acting. See more detailed terms and conditions here.