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Clarification, I hope...
Old 05-01-2008, 06:04 AM   #1
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Clarification, I hope...

I guess my first thread on Mom's dilemma I didn't make very clear. Truth be told, I'm not really sure what my question was either. The last visit I had with my Dad (RIP) we spent a little time on this, since I am the designated executor. I learned that they had about $80k in the bank (CD's) and about $150k in the house, which is of course paid off. they were intent upon leaving their son's some inheritance. My position was that all of their sons are fairly well off and would remember them with out any money left behind.

Now Mom, who has never had to deal with the money in the past, is trying to ensure this. She is convinced that as a 70 yr old diabetic amputee she won't survive 10 more years. And she is searching for some way to "protect" our inheritance now, with little or no guidance. I'd like to believe that my youngest brother would supply good guidance. He does have an MBA and a CPA after all. And he was the executor, until he insisted that the estate pay for his airfare from CA to FL when necessary to work on estate issues. M&D weren't having any of that, and those duties now rest upon me.

What I would like to try to get her to do is invest in some Vanguard or Fidelity fund that pays her dividends as an income supplement, until such time (if ever) that we need that money for her care.

As far as that goes, if or when she needs LTC, it is my intent to use her $700 a month as a base, add the amount necessary to bring it up to the cost of a decent facility and pray that we have enough. When the money is gone I was considering a reverse mortgage on the house. At least 2 out of 4 of us don't care if there is a dime left after she passes, as long as her time in LTC is spent in a decent and caring facility.

I am open to suggestions or experiences you may have had dealing with similar issues.
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Old 05-01-2008, 08:47 AM   #2
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Quote:
Originally Posted by LeatherneckPA View Post
At least 2 out of 4 of us don't care if there is a dime left after she passes, as long as her time in LTC is spent in a decent and caring facility.

I am open to suggestions or experiences you may have had dealing with similar issues.
IMO, it is no business of the other 2 if there is a dime left over or not. It is your Mom's money, it should all go to her care, as needed.

Now, if she ends up using it all up (including sale or reverse mortgage of the house), then you have a family 'situation' on your hands. Is everyone going to chip in equally, or is that not in the cards?

Considering your Mom's health situation, I think it's something the family needs to talk about, and prepare for.

-ERD50
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Old 05-01-2008, 09:04 AM   #3
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LeatherneckPA,

First I don't think you will be able to do a reverse mortgage on your mom's house if she does not live in that house any longer. But you can always rent or sell the house to help her pay for a decent LTC facility.

As far as investing her money, I would personally steer her toward a fund like Vanguard's Wellesley: It's cheap, it throws off large dividends to supplement her current income and it has a good capital preservation record to make sure that the money is there when she needs it.
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Old 05-01-2008, 10:04 AM   #4
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My FIL was a brittle diabetic who lived in nursing home care for the last 20 years of his life. Unfortunately, he ended up on Medicaid because DW and I and my BIL were poor college students when he lost his farm and declared bankruptcy.........

There are MANY questions I need answered before I feel I can offer some advice in a contructive manner:

1)Is your mom in a facility now?
2)Have you been looking at LTC? LTC carriers as a whole are not that fond of diabetic patients, because they tend to live longer than folks think..........
3)HOW important is "leaving a legacy" to her??
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Old 05-01-2008, 03:16 PM   #5
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1)Is your mom in a facility now?
2)Have you been looking at LTC? LTC carriers as a whole are not that fond of diabetic patients, because they tend to live longer than folks think..........
3)HOW important is "leaving a legacy" to her??
1 - No, Mom is not in a facility right now. She's living at home, alone. She gets by pretty well using her wheel chair and her prosthetic leg is supposed to be ready sometime in May. Either DW or I call her every morning to make sure she didn't wake up "dopey" from being hypoglycemic. she insists on staying in their house as long as possible.

2 - LOL, ok, a 70 yr old diabetic, double amputee, with a prior cardiac quad-bypass and history of high cholesterol. There is NO WAY she'd ever pass a physical to get LTC, IMO. Traditionally, her family has lived well into their 80's with no diminished capacity at all. My great-grandma Bessie was 92 when she gave me a portfolio of maps she had drawn and books she had used while in school. They still had sections titled Indian Territories, Oklahoma Territory, and such.

3 - On a scale of 1-10? I'd say for her and Dad it was somewhere around a 7 or 8. For Tom and I it's somewhere around a -1 or -2. For Jack and Kenny, I am ashamed to say that I believe they are already counting their money, especially Jack.

Mom and Dad's big thing was always that "We worked our asses off for this and we want our kids to have what's left, not some damned over-priced nursing home with lousy care." And especially after last summer!! The place her insurance company sent her was abysmal. The staff spoke broken, if any, English. They couldn't manage her insulin and meds. In fact, they were responsible for Mom crashing twice and having to be returned to the real hospital. They'd wake her up at 5-6am, give her some inedible slop, over medicate her, then sit her in front of a window somewhere in a wheelchair and come back maybe at lunch time to get her. And my Mom was one of the lucky ones who knew where she was and what was going on. I will not let that happen again.

As for what happens when the money runs out,,,,,,, I have no illusions of my brothers assisting me, at least not equally or reliably.
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Old 05-01-2008, 03:52 PM   #6
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I'm involved in a situation somewhat similar to the one you're in LeatherneckPA.

My MIL (DW is asking me to help) is 83 and an insulin dependent diabetic who uses a walker. She still lives in her own condo and is mentally very much on the ball. Her income is only SS at about $1k/mo which she supplements from an almost gone nestegg of about $10k. The condo is worth approx $150k.

Although MIL could wind up staying at home in the condo for several more years, we also realize she is also only one episode away from needing to be in a care facility. Her total net worth would pay for about two years as a private pay patient and then she'd be broke and have to go to Medicaid.

Our objective is to maximize the benefit of her current net worth. That is, have her current net worth do more than pay for her first two years only to have her bumped to an inferior facility when she runs out of money. So far I've determined that some facilities will not admit Medicaid patients but will keep patients on who need to switch to Medicaid due to exhausting their personal resources after they have been there for some time. Of these, some require an upfront, sometimes non-refundable, buy-in at admittance as well as evidence of the ability to pay for some period of time. I'm just beginning to check into these facilities/plans now and would be glad to share information as I get it.

You should:

1. Continue to not worry about the two siblings with their hands out......

2. Don't let your mom be the matyr trying to save a few bux for you guys......

3. Vist (this is NOT fun) some facilities and talk to them about your mom's situation.

The number of people who will be private pay for some time but who might eventually need to switch to Medicaid seems significant and it does seem like care facilities are developing plans to accomodate them. I'm optimistic of finding something for MIL where she avoids the issue of being private pay in a nice facility for two years and then getting booted to a dumpy Medicaid place when she's broke.
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Old 05-01-2008, 08:49 PM   #7
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youbet, I would be interested in hearing further details of your findings as you continue your research. The next trip I take to FL will include a couple of days of "evaluating" assorted facilities near Mom. Thanks.
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Old 05-01-2008, 11:14 PM   #8
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My mom is 86, blind, diabetic and has had many many small strokes. She has a pacemaker and is in declining health.

My dad died in 1999 and lived alone until 2005 when we finally convinced her she should not be at home alone and worrying about keeping up a 70 year old house. She sold the house in 2007.

My brother, who lives closer to her (150 miles vs 2200 miles) takes care of her bills and watches over her medical care (he is a PA). I take care of her longer term financial stuff.

She bought a LTC policy and paid for it in full 10 years ago. It has a 5 year payout. We are not using it yet and won't until it is needed. She is doing OK financially despite her demand to stay in only very conservative assets. It makes my job easier but is not doing much for her asset growth. (Actually, I put some of the house equity in a balanced Vanguard fund so she gets income and asset appreciation out of it).

She may live another 10 years or maybe not. Nobody knows when the Grim Reaper comes for you. We are planning on her living another 20 years from a financial perspective.

Her wish is to leave something in her estate for us. We don't need it or want it but she it is in her head to do so. Consequently, we are trying to keep as much of her assets intact for as long as we can. But, if she needs something that comes first. So far, she is running just about even with expenses vs income from the various sources. At her current rate plus an inflated inflation rate she won't outlive her money.

I second Youbet's comments. Mom comes first...period. What ever she needs; she gets. Your siblings don't count at this point.

It looks like your family needs to talk.
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