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Old 07-19-2012, 07:22 PM   #41
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Just had a memory of MMND, not sure why...
Catnip flashbacks.
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Old 07-20-2012, 06:20 AM   #42
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Our family agreed to give up cards and gifts years ago. We realized we were buying stuff none of us needed or wanted. Instead, we have great visits and treat ourselves to a nice meal for various occassions. I think it's improved the quality of our relationship since there's no pressure to buy the "right gift".
We still exchange gifts with the kids but my brothers, sisters, nieces and nephews adopted the no gifts policy a while back. Just too much of a hassle and never fostered any additional intimacy. Some people seem like they equate the amount and or effort put into a gift as some sort of proof of love. I don't like that at all.
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Old 07-20-2012, 06:34 AM   #43
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Anyway, is there a limit on how many houses you own? In the OP's case, he has 2.
Good question for two reasons...
First... The home has to be the primary residence, and has to be purchased or bought to replace another primary residence of the same or lower value than the current home... AND MUST confirm to the lookback period...
(so you can't suddenly buy a million dollar mansion, and expect that to shelter assets)
We began to relax about this in 2009, when our home purchase cleared the 5 year hurdle... BTW... that lookback used to be just 3 years.
.................................................. ......................

The question brings up another good point that needs some legal interpretation, especially for "snowbirds", or for anyone who has two addresses, such as a campground, or a "cottage on the lake", and like that.

Primary residence is important from many standpoints, and failure to stay "legal" can have consequences. Please don't take this as gospel, 'cuz i'm not a lawyer... (another reason for geriatric lawyers who have a better understanding of senior concerns).
Here are some of the issues where legal residence is important.
-Homestead exemptions
-Senior Tax freezes
-Resident state for Medicare Supplement
-State and local taxes
-Drivers Licences
-Medicaid
-Auto Insurance and vehicle garaging
-Campground addresses... (usually not allowed)
-Residence time periods... Most States have 6 Month limits on campgrounds.
-State and local benefits... senior passes, transportation, education etc.
-Food Stamps

Twenty years ago, the residence issue wasn't a big deal, but as the squeeze tightens, it's pretty important to understand the ramifications of
legal residence.

Thanks for the question...
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Old 07-20-2012, 12:24 PM   #44
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qualifying for medicare. I didn't think owning a home has anything to do with medicare qualification. I think you meant medicaid.

Anyway, is there a limit on how many houses you own? In the OP's case, he has 2.
Yes, I did mean medicaid. Thanks.
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Old 07-20-2012, 07:21 PM   #45
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what an enlightening thread! =) imoldernu, thanks so much for posting and please add future chapters if you can think of other lessons learned!
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Old 07-20-2012, 07:33 PM   #46
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what an enlightening thread! =) imoldernu, thanks so much for posting and please add future chapters if you can think of other lessons learned!
+1 thanks!
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Old 07-21-2012, 07:00 AM   #47
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Here is one more wrinkle to the nursing home bill

lt kids on the hook for nursing home bills?


Long Term Care Insurance Honor Roll
By Clark Howard

Got a parent in a nursing home? A surprise big bill could be headed your way even if you haven't signed for financial responsibility for that parent.

The Wall Street Journal reports that 29 states have passed what are called 'filial responsibility laws' to deal with the budget shortfall for Medicaid, which pays for long term care of impoverished seniors.

Among the states are Alaska, Arkansas, California, Connecticut, Delaware, Georgia, Idaho, Indiana, Iowa, Kentucky, Louisiana, Maryland, Massachusetts, Mississippi, Montana, Nevada, New Hampshire, New Jersey, North Carolina, North Dakota, Ohio, Oregon, Pennsylvania, Rhode Island, South Dakota, Tennessee, Utah, Vermont, Virginia, and West Virginia.
For years, I have said that if your mom or dad ends up in a nursing home and you have not signed for financial responsibility, then you are not responsible. (Of course, you as executor or executrix will have to parcel out the estate at the time of your parent's death to meet any obligations, and final expenses are the highest priority claimant in some states.)

But this new info flies in the face of what I've traditionally said.

To this point, Pennsylvania is the only state where financial liability against an adult child has been upheld in a court of law. (It doesn't matter if an adult child isn't involved in the life of a parent. They can still be held responsible in the eyes of the law.)

Obviously, this is a still evolving situation as our population ages. Only time will tell how courts in other states rule on this issue.

So what should you do if you have an aging parent?

If you are of means, it is to your advantage to do the kinds of things necessary to care for your parent. That might mean buying a long term care policy for parents. Or in the early stages, before your parents really starts going downhill, sit down with an elder-law attorney to discuss what kind of protections you can set up for yourself and your assets.

Adult children may be on the hook for nursing home bills | www.clarkhoward.com
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Old 07-21-2012, 12:40 PM   #48
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scary stuff. I suspect that, if you read the decision, the kids had power of attorney and didn't take prudent steps to apply for Medicaid or something like that. It doesn't seem reasonable that states Could generally declare your parents your dependants. Why not siblings. Why not neighbors.

Has anyone actually read any of these filial liability laws?
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Old 07-21-2012, 12:46 PM   #49
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A quick look indicates these things may be for real. Worth pushing your parents to get long term care if you are in the wrong state.
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Old 07-21-2012, 12:50 PM   #50
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Well, when the gummint's coffers are empty, drastic measures will have to be taken. We do not want to be like Greece, do we?

But I surely hope that some more sensible policies will get enacted first, before they go after the children. For example, the surviving spouse will need a place to live, and it is too cruel to confiscate the house. But how big a house? How about downsizing it to a mobile home? A little RV?
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Old 07-21-2012, 01:22 PM   #51
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I'm very impressed with both your plan and how well you've carried it out. The only issue I have with your approach is this:
That's not an assumption I can afford to make - 100 or maybe 95, but not 85. Odds are at least one of you, maybe both, will make it beyond 85.
I wonder how many "die broke" retirees are now living from one Social Security direct deposit to the next.
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Old 07-21-2012, 02:18 PM   #52
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A personal liability umbrella policy from American Family Insurance extends your coverage by adding a layer of protection over and above your primary limits.
If your agent has told you otherwise and you have dropped the underlying liability protection from your auto policy, you are uncovered from the first dollar of liability until you reach the 300,000 dollars (depending on state) that should have been covered by your auto policy. Any liability above that up to your umbrella limit is covered by the umbrella.

The umbrella is not supposed to be written without the proper underlying coverage, but if you have somehow gotten yourself into that position, you are NOT COVERED, no matter what the agent told you. American Family will NOT be providing coverage that is not part of your policy, no matter how innocent or well meaning your misunderstanding of their rules on underlying liability. You might want to verify if you are actually covered by the insurance you think you have.
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Old 07-21-2012, 07:51 PM   #53
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If your agent has told you otherwise and you have dropped the underlying liability protection from your auto policy, you are uncovered from the first dollar of liability until you reach the 300,000 dollars (depending on state) that should have been covered by your auto policy. Any liability above that up to your umbrella limit is covered by the umbrella.

The umbrella is not supposed to be written without the proper underlying coverage, but if you have somehow gotten yourself into that position, you are NOT COVERED, no matter what the agent told you. American Family will NOT be providing coverage that is not part of your policy, no matter how innocent or well meaning your misunderstanding of their rules on underlying liability. You might want to verify if you are actually covered by the insurance you think you have.
Very scary that OP may have been self-insuring for the last 6 years!
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Old 07-23-2012, 02:22 AM   #54
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Thank you for sharing, Imoldernu. My only concern, as mentioned by others, is your time horizon at 85 years old. I use 95, and some here plan for 100 as discussed in other threads.
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Old 07-23-2012, 08:08 AM   #55
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Here is one more wrinkle to the nursing home bill

lt kids on the hook for nursing home bills?

Adult children may be on the hook for nursing home bills | www.clarkhoward.com
This is outrageous and I hope that courts recognize it is outrageous. It is also impractical. What if the parent lives in a covered state and one or more children live in uncovered states? Or vice versa (my case)?
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Old 07-23-2012, 08:14 AM   #56
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The article that Clark Howard refers to was a WSJ piece discussed in this thread "Are You on the Hook for Mom's Nursing-Home Bill?"
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Old 07-23-2012, 09:59 AM   #57
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One of the suggestions made in the WSJ article was for the child(ren) to purchase long term care (nursing home) policies for their parents. Frankly, that kind of an expense is far outside of my budget (even twenty years ago).

Considering our own health situations, we decided to purchase long term care policies back in 1993... and continue to pay yearly. The coverage we took was for $100/day.... Nursing home or home care.. We chose not to take the inflation coverage, which by now would have doubled that to $200/day, but would have also changed the premiums substantially.

To date, I calculate that we have paid in some $48,000 for this coverage., which now would pay about half of the $70,000/yr cost of our local nursing home.

I haven't checked recently, but would guess that buying nursing home insurance for a 65 year old would be quite high, especially for $200/day coverage.

Here's a government website that gives info on calculating nursing home costs (by area), and then tables for estimating costs for self financing.

We agonized over accepting this expense. It's not an easy answer, especially considering the situation of the spouse who will not be in the home. Four years in a nursing home @ $70,00/yr would mean a $280,000 hit to the capital assets. If the surviving spouse should live another 15 or 20 years, this would have a serious effect on moderate budgets.

BTW... the current cost to increase our own individual policy which is now about $1200/yr for $100/day.... to a $200/day policy... would be an additional $2400/yr... Thus: for a $200/day policy at today's rates, our cost would be $3600/yr... per person. The earlier you buy, the less expensive.
Actuarially it probably all works out.
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Old 07-23-2012, 10:41 AM   #58
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Re: questions about the cost of umbrella insurance coverage.

I went back to when we added the umbrella insurance.

Here's what happened:

Since we don't have a pension, most of our assets are sueable. When I looked at our mandatory liability coverage, I realized that any serious accident could put us at risk for a lawsuit that would leave us penniless. When I spoke to the agent about increasing our auto liability limit to $1 million, , he explained that buying the umbrella coverage (to include the car, house, personal etc) would only be $80 more than the cost of increasing the individual liability on the cars to the same $1 Million.

The other part about car insurance, was the large difference in the garaging location... which also, then goes to the selection of the retirement location. With two cars, going from a Chicago suburban location, to our more rural small town, the difference comes to about $800/yr.
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Old 07-25-2012, 12:10 PM   #59
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Re: questions about the cost of umbrella insurance coverage.

I went back to when we added the umbrella insurance.

Here's what happened:

Since we don't have a pension, most of our assets are sueable. When I looked at our mandatory liability coverage, I realized that any serious accident could put us at risk for a lawsuit that would leave us penniless. When I spoke to the agent about increasing our auto liability limit to $1 million, , he explained that buying the umbrella coverage (to include the car, house, personal etc) would only be $80 more than the cost of increasing the individual liability on the cars to the same $1 Million.

The other part about car insurance, was the large difference in the garaging location... which also, then goes to the selection of the retirement location. With two cars, going from a Chicago suburban location, to our more rural small town, the difference comes to about $800/yr.
imoldernu,

I REALLY appreciate your threads. I've long thought that if done right that people could retire well on MUCH less than many experts say. One of the keys is being completely debt free (as you are) and owning a home outright.

I have some questions out of curiosity if you don't mind:

1) You mentioned somewhere that you were "blessed" to be debt free. Did you make that happen with your own budgetary efforts, or did you get a windfall of some sort? The word "blessed" makes me wonder if it was of your own doing. Good show either way...I'm just curious, because I plan to be debt free including the house before retiring, and that all involves my own doing.

2) You said you were going to get rid of the Florida home in a couple years and move permanently back north. Most retired people opt for the southern climate when given the chance, and you obviously choose the south for your winters. Just curious why you're giving up on Florida? I HATE winter and will leave Ohio as soon as possible once the kids are out of the house (I want them to be able to graduate from the school system here), and we're moving SOUTH.
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Old 07-25-2012, 03:39 PM   #60
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Blessed? Hmm ... still waiting for a windfall. Mostly just being scroungy, plus my kids put themselves through school for the most part. One thing that helped was that we maxed input into retirement plan, and maxed IRA contributions since 1974... through the high interest years... took the lump sum of retirement, to start my business, but got that all back when I closed it down. My earliest years were with Sears... when the ESOP was paying big... Many splits later, my Sears nest egg built substantially. Then, think housing... and the 8 moves... each time buying and selling... nominal profits each time...
oops... forgot one windfall... my bride's mom left us an $8,000 annuity, which has turned into about $45K over the years.
Anyway, my "nest egg?" is nowhere near what you might expect... just enough to get us through the next 10 years... Being Happy, for me, is not being rich.

Moving North?... Well, we're not totally sure yet... love Florida, but the security of our retirement village "up north" is pretty nice... We're not as active anymore, so being a little housebound.. not too bad. The apartments, rehab, assisted living, nursing home combination isn't available in Florida... Plus we don't want the nuisance of a major move... and I'd miss Woodhaven.

One of the benefits of being poor but secure... keeping our options open.

Looks like you're on the right track, and if I were beginning again, at your age, I'd opt for Florida...

You didn't ask, but my thinking on Florida is where we live in the middle of the state... Cost of Living difference... as best I can guess is about $6K to $8K per year...
and... spend the time to find the right place... Look for a 100% fit with your interests and needs... there's a perfect place for everyone. Settle for nothing less. If you want fishing or surfing or culture or golf or a great social life (as we did) it's there. Just remember to check the prospectus.
Best of Luck... debt free is a great start.
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