I visited with a close friend last week and we shared about how irresponsible our parents are with money. My friend's dad is in a worse situation. His 70 year old dad is $20,000 in credit card debt and is in the process of losing his free housing through a friend. At this point, he might have to get a shitty retail job to survive. Walmart? My friend gave his dad money in the past, but decided he is no longer going to do it.
My Dad and step-mom retired in 2011. My dad has a good pension through his construction job (42 years of service) and they both collect on social security. I think their take home pay is around 75K (after taxes and health insurance) The problem is that they like to spend 100k+/year. They are both 70 years old.
My dad saved some extra fun money before he retired (good for him). They inherited about 250K to 300K in 2012-2013 when the mother of my step-mom died. As a result, they never were forced to live on 75K/year.
It's like watching a train wreck in slow motion. They are currently selling their 2nd home because they are out of money. I'm fairly certain all the inheritance money is gone. If it wasn't, they would use that money to keep the 2nd home, which they love. They do not want to sell it.
I predict that they will start asking the kids for money in 12-18 months. There are 3 kids total.
My wife and I live on 65K/year (after taxes and insurance). I save about 5K through my work pension and another 8K/year from our rental properties. Our total income from rental properties is 18K/year, but we currently spend about 10K of it. I am working toward saving a larger chunk of it in the future.
If they ask me for money directly, I feel pretty comfortable on how to handle it. The answer is, "no" and I think they know that. If they cannot afford their housing, they always have to option to live at my house.
I'm more worried if my siblings come to me and say something like, we want to start giving our parents $250/month each to help them keep their home. Any suggestions on how to handle that one?