Yahoo Finance Retiring to a Hotel: Is It a Real Money-Saver or Financial Misstep?
Deciding where to retire involves finding the right location and the right type of housing, which usually means choosing whether you want to rent or own. Broken down further, the search usually involves apartments, condos, townhomes, single-family homes or retirement communities. Chances are you haven’t considered retiring to a hotel — though some experts say you should.
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A recent YouTube video on the Grounded Life channel analyzed the potential benefits of retiring to a hotel. Titled “Retire To A Hotel – Low Cost Retirement Housing,” the video provided insights on the perks of hotel living (free cleaning services, breakfast buffets) and some of the cost savings you can enjoy by building up loyalty points and locking in lower rates.
A blog on the Great Retirement Spots website also took a deep dive into retiring to a hotel and found that while it’s “not the most economical way to retire,” it can still be done for “about the price of a middle class lifestyle” when you consider that you won’t have to pay expenses such as utility bills, maintenance and repairs, HOA fees and property taxes.
“As long as you continue to pay the bill and are not throwing wild parties every night, many hotels are happy to have you stay for as long as you would like,” Great Retirement Spots noted. “Some specialty hotel chains, including Extended Stay America, even cater specifically to people who want to stay in a hotel long-term. And if you are single, why not bring a friend and share the costs?”
From a strict money standpoint, however, retiring to a hotel does present certain problems. For one thing, people who turn 65 have an almost 70% chance of needing long-term care at some point in their remaining years, Forbes reported. One of your main priorities as a senior is putting away enough money to afford long-term care — and that might be hard to do if you choose to stay in a hotel after you retire.
According to Rent Café, the average rent for an apartment in the U.S. is $1,713 a month as of March 2024. That figure will vary depending on where you live, with some places coming in much higher and some much lower.
Compare that to the average cost of a hotel. In an analysis of more than 50,500 U.S. hotels, the Budget Your Trip website found that the median price of a hotel room is $139 a night. That comes to $4,170 a month based on 30 nights. The median price of a budget hotel is $93 a night — or $2,790 a month based on 30 nights.
Even if you retire to a budget hotel, you would still pay $1,000 more a month than you would renting the average apartment — at least on paper.
However, if you are able to get a better hotel rate through loyalty rewards or negotiations, you can bring the price down. When you add that to utility and other cost savings, retiring to a hotel suddenly becomes much more financially viable.
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This article originally appeared on GOBankingRates.com: Retiring to a Hotel: Is It a Real Money-Saver or Financial Misstep?
