Hello,
I am in need of some advice. My mom is 79 and my dad is 82 and they live in their own home which has a reverse mortgage attached to it (which is at its limit). It has come to my attention that they are completely broke. No savings at all, and on top of that they have an unknown (to me) amount of credit card debt and personal loans. The only income that they have is Social Security. This all came about after many years of financial support for my sister who has had mental health issues (hoarding, OCD, eating disorder) which caused her to have a lot of medical bills, but on top of that she has always lived beyond her means and when she would get in trouble my parents would bail her out. She’s been fired from jobs at least 4 times, and during periods of unemployment (which sometimes would last a year) my parents would pay all of her living expenses: rent, food, medical etc. My sister has never been married and doesn’t have any kids so she is completely alone. My dad asked me for money last month (which I gave), and that is how I learned how dire their situation is. My sister is currently employed and I asked my parents if they have asked her for help but my mom said she is unable to help because it is hard for her to be single and pay her own bills. (My sister lives extravagantly in a downtown Chicago high rise apartment.) We are in Colorado. I am married, my husband makes a decent living and I work part time. We have 2 sons, one who we just put through college, and another who we are currently helping through college. We have always been responsible with our money, we have a good retirement savings account, but we don’t have the means to financially support my parents, especially with one in college. I also feel like if I give my parents money, it’s basically just my sister’s issues trickling down to me and my family and becoming our problem, which I don’t agree with. This is a very emotional situation for me due to the complex feelings I have about my sister and the choices my parents have made. My dad was a very successful businessman and had a lot of money at one time, and now at 82 years old he is trying to become employed as a consultant. He told me that he needs to bring in about $9,000 a month to support himself and my mom. I have tried to have them set up a meeting with a financial advisor that my husband and I can be a part of but they keep pushing that off, with my dad saying he’s got job interviews and that it will all work out. I don’t want to insult him by insinuating that he’s not going to become employed, but he is 82 and he does have elderly mannerisms in the way he presents himself so I just think we need to be realistic about if that’s actually going to work out for him. I don’t want to treat my parents like children but if he really needs $9,000 a month in income then I can’t help but think that they are in a very serious financial situation that is going to become a very big problem for me and my husband pretty soon, and that we should be working on it now. I am pretty sure I will get no help at all from my sister and she is my only sibling so it’s all going to fall on me. I just don’t know what to do next but I feel like there is a sledgehammer above our heads that’s about to fall. I know this is a complicated situation, but being so emotionally involved I just don’t think I’m going to be able to make decisions clearly.
Once that is in place, you can put all their necessary bills online to manage payment from there. When you sit down with them, tell them they must agree to this plan to keep a roof over their head and utilities on.
One thing to remember if you leave them to their own devices to figure out the bills: They may continue to pick and choose what to pay each month and they may not choose the important bills. They need oversight
Remember that if their finances are private and none of your business (they don’t want disclose their income or spending information), their finances are private and none of your business (you can’t get involved with your time or money).
It is possible that their current housing expenses are competitive with whatever they would consider an acceptable replacement (taxes + insurance + maintenance + utilities vs. 2 bedroom downtown apartment). If they are competent, they get to decide where to move.
Lots of credit card debt may not make much difference either. They can stop paying. SS income is resistant to garnishment from most creditors. A bad credit score just makes it harder to borrow more.
When they ask for help, and it doesn’t sound like that has happened yet, then you can see how much they want you involved in their business. Until then, it’s fine to start a file of ideas on how to spend less, qualify for various programs, and get out of debt; file it and put it back out of your mind. I wouldn’t want to live on SS alone, but plenty of people do.
The only thing you would really need to act on without an invitation is if you believe they are mishandling money because cognitive decline is interfering with their IADLs.
https://www.agingcare.com/articles/instrumental-activities-of-daily-living-defined-427370.htm
Remember, NO is a complete sentence. You have expenses now, with a son in college. You will have expenses down the road as your family ages. Do Not Light Yourself On Fire To Keep Someone Else Warm. Your immediate family always always comes first.
They’ve spent a lot of tax free money over the past few years between the reverse mortgage and the credit card debt. To net enough to not have to cut back, they’d have to add back in the payroll and income taxes to break even.
Your parent's financial troubles are not yours to carry.
The troubles your parents and sibling have are of their own making.
Unless you want to keep the downward spiral going to another generation STOP helping them. Or you and thus your children will be sucked down this whirlpool.
Your parents should talk to a Financial Counselor that can help them make decisions that will be best for them in their future.
As difficult as it will be THEY need to tell your sister that the Gravy Train has dried up.
You and your husband need to think about YOUR futures and what lies ahead for you. Make those plans.
You can support your parents and sister by helping them find resources that will help them but do not help financially, that is not helping it is enabling.
Your posting here is primarily about your sister, not your parents. There's no mention about their health and their needs. Sounds like they need to sell their home and move to a low income housing establishment for seniors, perhaps in Colorado? Please call Adult Protective Services in their area to see how they are living and what the system will offer them, including food (SNAP?). If you try to support them financially, then you would be enabling them to continue their codependency with their other daughter. Perhaps "no contact" until APS does their evaluation and notifies you (if they will): do you have Power of Attorney?
Perhaps you can make an appointment with an Elder Law Attorney to get strategies.
I would suggest power of attorney over both of them before anything else. let them know this is the way it has to be because of the change of life that they’re going through and they need help now.
living arrangements: umm, possibly have an in-laws house built on the back of your property and let them live there, or find some similar situation for them, and care for them had a close distance.
Your sister doesn’t enter into the equation as she isn’t sounding responsible enough to do so. when we think of the big picture in life that “people should, should, should” but In the face of reality you gotta stop barking up that tree. It only will frustrate you. Let it go.
I had a boyfriend and Wound up being his parents primary caregiver. I even moved in and managed the home with an additional five staff for a number of years. I had no obligation to do so but I was in love with his parents and after you get involved it’s hard to let go. It seemed criminal to me if I did. during this time, logically I knew it wasn’t my responsibility and I could go do other things with my life. I resented being there for quite some time but my sense of right & morally wrong made me stay. Eventually I finally gave up that internal fight. Surprise! I actually started enjoying myself, the routine, the company of the other staff and much more.
You’re gonna have to resolve this in your heart and it might be a process that takes some time. you sound like a responsible person and you know what the right thing to do is it’s just getting yourself to move in that direction. Pray about it and remember action comes before motivation.
God bless you and your family.
It sounds like your Dad is refusing to meet with you, your husband and a financial planner.
At that point there is not a lot you can do.
An additional thing Dad can do (since he was a very successful business man) is drive around
to three jewelry stores and get quotes and sell any gold jewelry and any sterling silver. This will
get him a bit of cash.
Depending on how you regularly communicate with him....verbal, email, us mail....I'd bounce
things by your husband and get Dad a list of suggested changes/modifications to their lifestyle.
I live in Florida and it is really common for 80 year olds to be working but generally they are working entry level jobs, grocery store bagger, motel desk clerk, etc.
Advise sister that your parents are bankrupt and can no longer help her out again ever.
Suggest keep your sister out of the solution. She is mentally ill. This will fall on Dad to figure out.
could your parents get a pay off figure on the loan? Reverse mortgage loans are usually for about fifty percent of the value of the house. How much would be left after the payoff? I’m guessing your dads SS income would be to high for low income housing.Would you consider asking them to use some of the moneys for putting on an addition to your house? Maybe a small condo in your area? “It would make me so happy to have you and mom living close to me”.
would you consider a go fund me fundraiser in the area where they live explaining why your parents are in need?
it’s a tough situation for you Jayme but you took the first steps. Just feel good that you are trying your best to help, you can’t do more then that?
If you can afford the construction costs, ongoing increase in property tax, and all the other ongoing expenses on your own, AND you are fine with renting it out to a stranger when they move on then it might work.
Letting them gift you money (paying for the addition without adding them to the title) starts a 5 year Medicaid lookback timeline. You are the default caregiver, even if you find out you sister is their new POA.
Putting them on the title enmeshes their chaotic finances with your own. Plus you get to anticipate having their guests move in with them temporarily or having someone else inherit their share and move in. Or maybe they’ll change their minds and want to sell.
There are so many ways this can go bad.
If they have two cars have them sell a car immediately.
Hang out on Mr Money Mustached for other suggestions.
You will not get anything...help...or money from your sister. She is mentally ill. Let it go. I have
mentally people in my life. Best thing is to let go of the anger and don't count on her for anything.
Your Dad needs to consider declare bankruptcy.
Sell house. Move to small efficiency apartment.
Look into reduced price senior apartment.
Stop any payment to credit cards. Use social security to pay for food, gasoline etc.
Sign up for food stamps.
Seniors can get utility assistance. Dad needs to check with his utility provider.
There is still a big demand for low pay worker bee jobs. Your Dad would get hired as a grocery bagger or a convenience store worker. Your Dad is employable but rate of pay will be $12 - $15 per hour. He needs to look for places with help wanted signs out. There is still
a giant demand for workers but it will be lower pay employment.
Don't pick up the rope. I'd tell them you cannot afford to give them anything. Giving them
money would be a bottomless pit.
Give Dad the other suggestions.
You are thinking of debt forgiveness when let's say for example a credit card company does a settlement on less than what is owed. The differnce is counted as income.
9k a month? What do they spend 9k a month on? Sorry, I may have to be blunt with Dad. And I agree your husband needs to back you up. He is in LaLa land if he thinks he will be hired as a consultant at 82. In the meantime, they are getting further in debt. Dad needs to understand that you cannot support him and Mom. You have financial responsibilities of your own. The only thing I can see is to declare bankruptcy. But if they do this changes need to be made. They will need to downsize drastically.
I have an idea how reversed mortgages work with the equity of the house. Are you saying even if they sell, that they will not profit much on the sale or at all? I think Dad should sell the house. This will relieve him of taxes and upkeep. They will need to get an affordable apt. Selling what they don't need. Do not allow them to move in with you. This is not an option. They are where they are because of choices they made. As soon as they decided to get a reversed mortgage, their spending should have been cut back. Dad needs to realize that you cannot be his saviour. There is no way you can support them and your family too. Sis needs to be told that her parents are on the verge of bankruptcy and she is on her own now. And be blunt, you will not be her bank.
I would wonder what they get in SS and hopefully pension a month. I would give Dad no money. I would buy them groceries. I may directly pay the electric and heating bill. Just necessities. You may want to check their taxes to see if they are being paid. This is public information. I would give him no money in hand. And he needs to understand that you will not continue to pay bills for him. He needs to live on what he brings in.
So sorry you are going thru this. But, you need to be blunt with both parents. They need help. They are over their heads.
#1: a conversation about the situation with your sis! She should feel remorse/guilt that they were there to help her in time of need.
#2: 9K is a lot for seniors a month. They should be very comfortable. I think you have mismanagement of funds happening.
#3: An elder attorney is a MUST is this situation!
I wish you the best. It sounds like you are practical, but you unfortunately need to drive the situation forward.
Your parents sound worse off financially so both of them should qualify for Medicaid. The right attorney can make a world of difference also dealing with the reverse mortgage.
Although they are not overly elderly it is likely that health issues may develop. If you do go the attorney route just be sure it is one that really specializes in elder care and if possible get recommendations.
I don’t agree that you should try to get POA. That will only cause direct battles with your sister. If your parents are doing ok mentally, then leave them be. And say no if they ask you for money. Or ask you to be their executor. You are not responsible for their mess.
The only thing is increase income or reduce expenses.
They can probably sell their house, reverse mortgage usually gives about 55% of equity. Depends on several factors, when they got it how much they owe, increase in house value. But sell they must, as there is upkeep, utilities etc.
Then if there is money invest conservatively, somewhere without commission and secure.
Sister should be making some kind of contribution, repayment.
You should if you want to add all their expenses and see where to cut down, ask father to write down what they spending monthly. Financial advisor will not help that much, financial planner will be added expense.
You should not give them money as possibility exists they want you to support lavish lifestyle.
Give them nothing, and let them pay the price for their bad decisions.