Currently, my mom's annual expenses are running around $40k a year to live in her senior living place, including her health insurance, phone and internet. She gets about $21k a year in social security, so for now, she's only needing to use about $20k a year of her retirement money. So far, this year, she has earned a nice 15% return on her money. As much as her investment guy ticked me off, he does do a great job investing. While, of course that 15% could change by the end of the year, with still 2 months to go.
So, she's increased her investment account by a whopping $139,000 since Jan 2021. Plus the $21k of social security (next year should be about $22,400 with the increase). A total "income" (of course I realize the $139,000 is unrealized gain) of $160,000, just to be retired, LOL. When I first created the spreadsheet to track her money and estimate how long it would last, I used a modest 4% return. Last year she earned 12%. Even at a very conservative 4% she was not going to run out of money until she was like 100. At these higher rates of return each year, she just keeps earning more than she is using and it's snowballing. At the beginning of each year, I just update her spreadsheet to show that years beginning balance and then it projects forward. Last year she increased by $124,00 (not including social security), this year by potentially the $139,000.
So, I'm confident, no matter how long she lives, she has more than enough money to take care of her needs. I know I've said it too many times, but step brothers "she only has 8-10 years of money left" (which would now be 6-8 years, since it's been 2 years ago he said that) is a crock of stupidity, LOL. She is in no absolute danger of running out of money between now (age 80 1/2) and her end of life.
She is always saying to me "you should just use some of it now, if you need something, rather than wait until I'm gone. I don't need this much and you're going to end up with what's left anyway. You might as well enjoy some of it now. Just take some". I always say oh that's really sweet and change the subject, haha. While I know she could gift me $15,000 a year, with no income tax, and honestly it would hardly even make a dent in her money, I just can't do it. Part of it is just me, part of it is with her memory now, I'd feel like I'm taking advantage, even though she is the one always bringing it up. If her memory was intact she would very most likely do the gift thing. Years ago, she and my dad would gift us like $1,000 a year at Christmas. It was always such a nice gift, especially as dh and I never had any extra money.
I'm just relieved that while it's so hard to deal with her memory loss and the issues it brings, I do NOT have to worry about her money!
You have a good handle on he rmoney, an dI think if you have no need for the funds, just leave it be even if she insists. As you said, her memory issue might just create a weird feeling for you.
ReplyDeletethat's what I'm thinking, too. Though getting our bonus room finally finished would be nice...LOL. While I know a lot of people wouldn't hesitate, I just can't do it.
DeleteTotally agree with Sam. If she didn't have memory issues &/or you needed the money, I think you'd feel comfortable pursuing other options. It's such a gift to know she's financially independent, & you can help her without needing any of the money.
DeleteI know it's a relief for you to know she is financially independent.
ReplyDeleteit makes a world of difference. Gives us lots more options for her care
DeleteI understand how you feel about getting gifts from your mom with her memory issues. As for the investment guy, did you receive the paperwork related with the changes made to the beneficiaries' percentages? Yeah, I know I am a control freak.
ReplyDeleteThe assistant did follow up with me last week about it. she said the paperwork is being sent out from their main office back east, so might take a week to get here in the mail. I'm expecting it this week. She also said to let her know when I have mailed it back so she can make sure it's received and updated.
DeleteSo many people have trouble caring for older people because of lack of funds, either their own or the elderly person's. It is good you keep a close eye on her investments. I would feel funny, too, taking money. Some people would dip right in a parent's account!
ReplyDeleteSomething you should consider - letting her "gift" you the $ while she is still alive. Possibly it will bring her some joy seeing something you've done with it. While we don't have kids, we do have an almost 8-figure net worth, so we are "gifting" our 4 nieces/nephews by putting them through college so that they will no have any debt once they are out. And, we get to see (God-willing) how it all goes. I had told my husband, "why wait until we're gone - let's do this NOW so we can get some enjoyment out of it, too!" We've also done some great trips with the kids - we tell them we're spending their inheritance WITH them! And making some really great memories for them! So just something to consider.
ReplyDeleteI think she did pay for the grandkids college which is great and you have your faculties in order to gift but it gets very tricky with memory issues and power of attorney. I do also truly believe in trips/memories with grandkids. Wish I could do more for them but thrilled with what we can do.
DeleteAnon- yes, that is what she keeps saying, she's like to see me enjoy some of it now. JRE - yes she did put dd through college, though thanks for dd's doing her first 2 years while still in high school, she only had to pay for 2 years and it was a state college.
DeleteThis is why I’m wondering if you are hesitant about hiring more personalized help as it wouldn’t be about the money. She has plenty. How did hiring someone to do her laundry go? You had mentioned starting that. I truly think she needs that and more. I’ve been doing home care as a RN for more than 23 years. If you’re only there every couple of weeks for a few hours (this is no criticism) she would benefit from set, frequent interactions especially as she can afford it. So many can’t. The other RN I work with and I always kind of find it amazing that with the right aide that our clients who initially didn’t want anyone in the home find them invaluable, almost friends. Often the reassuring “ don’t worry about the money, it’s included or set up that way….works when the client worries about money. Yes I do agree with you at this point with her memory involvement, gifts of money from her would not be right anymore.
ReplyDeleteI think it is just such a hard decision to make. My aunt had way less $$$, we kept her at home until close to the end, and I think it is because her main decision maker could not deal with sending her to a facility that would better deal with her dementia. But the time does come, but I know it is a super tough decision to make.
Deletehiring the help isn't about the extra money cost at all. It's her reluctance and not wanting it. She isn't comfortable having people come in her apartment, so it would take awhile for her to adjust to having someone come in and help.
DeleteMy aunt did not want anyone coming in either - over time, she did get used to it and she adored her #1 psw!
DeleteJJ - I've heard that, too - initially the individually may not want/be reluctant, then they come to consider that "Senior Helper" a friend they look forward to seeing. The ones where my parents live are amazing. One takes her "client" out for ice cream, sits & plays cards with him, helps him do his laundry, etc. They are real buddies!
DeleteThis is what I mean, I’ve been a supervising RN for home health aides for over 24 years. Hardly anyone wants help (really about no one ha!) but it truly gets a second eye, a special friend and an amazing support to keep people safely in there own home. I’m an obituary reader and often see tributes/thankyou to the carers that cared for their loved ones as it is that special. As I’ve previously said often how you word it, reassure its paid for/provide etc. the more the person comes the more familiar it gets. And yes outings, ice cream, meal help (I know your mom gets meals) cleaning, laundry, med help etc. How often does your mom bathe etc (people forget they haven’t). And just the social interaction is healthier. Have you hired someone to do her laundry? It sounds like she was struggling with that.
DeleteI've started doing her laundry for now. I thought I would get her used to having someone else (me, for now) doing it for her and that would hopefully make it easier when I do hire someone to do it in that she'll already have in her mind that it's been being done for her.
DeleteThose are indeed very good rates of return on her investments aren't they. It must be such a relief not to have to worry about her finances!
ReplyDeleteit's certainly one huge thing not to have to worry about, that's for sure.
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