The Transfer of Intergenerational Wealth

"Families need to be aware that what we are talking about here is the transfer of intergenerational wealth, not to families, but into the pockets of large multi-nationals.

Shame about elderly people not having enough money for aged care."

Tom Gait, Retirement Village Residents Association.

Wednesday, 30 May 2018

Residential Tenancy $ Outperforms Retirement Village $

For retiree accommodation, a standard residential tenancy can outperform a retirement village in pure financial terms.

At the 7 year mark the retirement village industry average occupancy period, the example below shows the retiree in a residential tenancy is $241,471.00 dollars in front of the retiree in the retirement village.

Such is the upfront pain in the Deferred Management Fee model used by the industry, it takes over 17 years for the retiree in the retirement village to draw level in financial terms.

There are aspects to life in a retirement village the retirees value that do not have a definable $ value, on the flip side retirees must pay for facilities etc. that they do not use.

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Function of Government

The role of government is to create an environment for commerce to function whilst at the same time protecting retirees and particularly vulnerable retirees from both financial and emotional harm emanating from that function.

The Victorian Retirement Villages Act 1986 provides the environment for commerce to function but fails to fully protect retirees from financial and emotional harm as a result of it.

The Victorian legislative definition of a retirement village in demanding the payment of an 'in-going' amount without the transfer of property ownership is a major contributor to that financial and emotional harm suffered by retirees.

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