Author Topic: Maybe moving mom into duplex... crazy?  (Read 5123 times)

pminkler

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Maybe moving mom into duplex... crazy?
« on: March 18, 2015, 09:58:03 AM »
I'm in a little bit of a pickle with my mom.  The thing is, if I don't really care, I could be just fine...and she probably wouldn't be starving either.  Story goes...

She's been disabled since 1993, diagnosed with fibromayalgia.  She had a $250k settlement in ~1995 with her disability insurance company (since spent), plus monthly payments until she's 65.  She's 61 now.  She's collecting some form of social security right now (must be SSDI?), plus disability payments.

A few years ago, she must have been up watching infomercials and got into a day-trading thing, learning Forex trading and options...paying for classes to the tune of about ~$40k (which she didn't have) and immediately bought a new computer and triple monitors on credit for, I'm guessing, $3-4k.  She's been bankrupt before, and right before this, she was debt free.  Her plan was basically to go pedal to the metal to learn this stuff so she can trade at home when she turns 65 and loses her disability.

Currently, I believe she's debt free again...maybe?  At least she said she was months away from it.  Must have had some leftover from her SSDI or Disability, because she hasn't made a cent in Forex/options...and has no real money ($10k+) to put towards it, really.

The problem is, she's currently living in a carpeted, heated garage (it's a nice one, trust me!)...in her sister's house.  My mom lost her house because she couldn't afford the mortgage payments (several mortgages or something I believe?  It was once paid off, but was used for another loan.  I'm not sure?).  At the time, my aunt's garage was the only option.  Of course, mom is a bit of a packrat and my aunt isn't...and they clash hard on that.  Like mom's stuff took over her garage, attic, basement...and now my aunt is trying to get my cousin in that house, since SHE'S going through a divorce.  Long story short, too many people in that house who do not get along.

Since the other half of the duplex I own wasn't leased for a full year, I offered to move her in with me...in the other apartment.  Figured I'd help her out, give her her own space and such.  Rent is $650.  I must charge that to be at "fair market rent" to be considered a rental property for tax purposes.  I also must charge that, to, you know, make the profit I was expecting so I can continue along my goals.  Most of my money is in that rental property.  If she were to pay less than $650 (not to mention 3% annual increase), the property will always be a loser.

I asked her plans were for when she turns 65, and she said "forex, forex, forex."  I asked what her plan B was.  She said nothing.  Coaxed more, she said food stamps and Medicare.  She's unwilling to research or do anything else...like proofreading, writing, Etsy and the like that she could do from home...since she wants to focus on Forex.

Am I just going to have to say "sorry I need the full rent no matter what, get along with your sister"?  Are there other programs out there that are reliable? 

Asking what her budget is would be fine and she'd probably offer it...but critiquing it would unleash the fiery hell of 50000 suns upon me.  I can tell you that she likely doesn't spend much anymore.  She can't really leave the house and seems to only buy somewhat necessary things (not how it used to be).

ShoulderThingThatGoesUp

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Re: Maybe moving mom into duplex... crazy?
« Reply #1 on: March 18, 2015, 10:07:01 AM »
Can she get Section 8? Can you take a Section 8 voucher from your own mother, legally?

GizmoTX

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Re: Maybe moving mom into duplex... crazy?
« Reply #2 on: March 18, 2015, 10:11:55 AM »
If she's planning on Forex saving her, why isn't it saving her now? What's going to change? Has she done any virtual trading to prove she is any good at it?

Is she living at her sister's house for free? If so, how will she afford to pay you anything, let alone the $650 you need?

I do think having her nearby as she ages is a good thing, if you can maintain your own separation.

neil

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Re: Maybe moving mom into duplex... crazy?
« Reply #3 on: March 18, 2015, 10:44:16 AM »
So, what do you plan to do when she gambles the rent money on Forex and loses?  This is a pretty foreseeable event.

Subsidized senior housing would probably be a better option for her.  Rent based on income, neighbors her age to talk to, and probably other programs to help due to her disabled status.  My grandmother was living in a pretty decent place for years on something like $200 rent in an area where $1000 is typical.  Where I am from, many complexes have waiting lists going back years and now might be the time to look into it if she is not going to be able to afford any reasonable kind of rent in four years.

pminkler

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Re: Maybe moving mom into duplex... crazy?
« Reply #4 on: March 18, 2015, 10:48:59 AM »
Can she get Section 8? Can you take a Section 8 voucher from your own mother, legally?

That's definitely something to look into.  Maybe I can get what her reliable gross income would be and tell that number to one of the offices around town that handle Section 8 stuff.  Sounds kind of perfect if it's legal to do.

If she's planning on Forex saving her, why isn't it saving her now? What's going to change? Has she done any virtual trading to prove she is any good at it?

Nothing will likely change.  She has worked on a program to automatically do the trading (coded by my brothers, using her criteria)...that is not very good.

Is she living at her sister's house for free? If so, how will she afford to pay you anything, let alone the $650 you need?

I do think having her nearby as she ages is a good thing, if you can maintain your own separation.

She's paying $500/mo to her sister.  I'm not sure that she could afford that after her pre-65 disability payments drop out.  She's also going to have increased medical costs...currently $800/yr and rising.

I agree that being close-by would be good...but I do not want to end up having her drag me down.  I understand that she has not prepared herself AT ALL for "retirement"...and that SOMEBODY has to lose money to her black hole.  I'm not sure of any way to minimize the gravity of it, though.

pminkler

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Re: Maybe moving mom into duplex... crazy?
« Reply #5 on: March 18, 2015, 10:53:48 AM »
So, what do you plan to do when she gambles the rent money on Forex and loses?  This is a pretty foreseeable event.

Subsidized senior housing would probably be a better option for her.  Rent based on income, neighbors her age to talk to, and probably other programs to help due to her disabled status.  My grandmother was living in a pretty decent place for years on something like $200 rent in an area where $1000 is typical.  Where I am from, many complexes have waiting lists going back years and now might be the time to look into it if she is not going to be able to afford any reasonable kind of rent in four years.

Yeah this is a very hard truth.  I've been joking to her since I was 16 about sending her "to the home" lol...never thought I'd have to do it.  Sounds like it'd just be apartments, though.  Not a stuffy, sad old folk's home.  She'd have to get rid of so much to move there.  Would be a huge ordeal, and she'd sit in that apartment and probably kill herself (she's been either suicidal or crying for help in the past)...since it's basically her last stop after losing everything.

GizmoTX

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Re: Maybe moving mom into duplex... crazy?
« Reply #6 on: March 18, 2015, 11:11:02 AM »
It's generally a really bad move to have relatives living in your house, even if it's next door -- it's just too tempting for them to start expecting you to carry their load, just like family "loans". Do investigate the subsidized senior apartments; my aunt lived in such a place for 20 years & it was very nice.

However, when my mother was battling cancer & dementia, we moved her into our home & she turned over all management of her finances & medications to me. She was bad with money & we refused to subsidize her until it was obvious that she needed end of life help; she couldn't spend any more & we were able to maximize her remaining time.

pminkler

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Re: Maybe moving mom into duplex... crazy?
« Reply #7 on: March 18, 2015, 11:28:41 AM »
Do investigate the subsidized senior apartments; my aunt lived in such a place for 20 years & it was very nice.

This sounds like where this might end up.  Short of Section 8 making up the difference and her NOT trying to bilk more and more money out of me over time, it sounds like the only reliable thing to do.

arebelspy

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Re: Maybe moving mom into duplex... crazy?
« Reply #8 on: March 18, 2015, 11:32:48 AM »
AlexK's MIL sounds similar to your mother. Only she blew about 40k she couldn't afford on real estate training. Yours blew 40k she couldn't afford on Forex training.

http://forum.mrmoneymustache.com/off-topic/a-vent-about-how-bad-this-year-has-been/

My advice is the same: make sure she's getting as much other help as possible, then do what you have to.

I think your idea of not being set back is naive.  You may be in for some frustrations. I'm sorry. I hope it works out well!
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pminkler

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Re: Maybe moving mom into duplex... crazy?
« Reply #9 on: March 18, 2015, 11:55:59 AM »
AlexK's MIL sounds similar to your mother. Only she blew about 40k she couldn't afford on real estate training. Yours blew 40k she couldn't afford on Forex training.

They could be roomies!  Problem solved!

Wow, it's like I'm reading a story about my own mom.  "Too proud" and argumentative if you say anything is her fault. 

Sounds like I'm in for a rough one.  I have three other brothers, but who know where they will be in 4-5 years...and I can't exactly make a contract and just get deeper in drama and agreements.

I'll see how she responds to Section 8 and/or senior housing.  She's definitely not going to make this easy.
« Last Edit: March 18, 2015, 11:58:47 AM by pminkler »

GizmoTX

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Re: Maybe moving mom into duplex... crazy?
« Reply #10 on: March 18, 2015, 12:22:52 PM »
I'll see how she responds to Section 8 and/or senior housing.  She's definitely not going to make this easy.

Make that her only choice; take your duplex off the table. Your aunt will have to be the bad guy to get her to leave.

DH & his 2 sisters had to convince my MIL to move into a senior community when she was 90; her house was too dangerous for her, gangs had started targeting her neighborhood, & my SIL finally refused to drive 3 hours RT several times a week to get to her place to help with errands. MIL was very angry, but had to agree that her safety was in danger. It turned out that she could not imagine how her houseful of stuff could fit in a 1 bedroom apartment. It doesn't! The family helped her choose the very best pieces to put into her new place. The stuff she couldn't decide what to do with got trucked off to a storage place; she got the key & the monthly bill. She just needed a little time & got rid of it all in months. In your mom's case, if she can't pay for storage (which I don't recommend other than to bridge a move), then the stuff will go away whether she likes it or not.

lizzzi

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Re: Maybe moving mom into duplex... crazy?
« Reply #11 on: March 18, 2015, 07:00:15 PM »
Help her get on the Section 8 housing lists, and she can stay at your aunt's while she waits for an apartment to come up. Do not let her live in your duplex.

Retire-Canada

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Re: Maybe moving mom into duplex... crazy?
« Reply #12 on: March 18, 2015, 08:51:54 PM »
Do not let her live in your duplex.

^^^^^ this. Unless you are prepared to let her live there for free and likely end up subsidizing more of her livings costs.

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arebelspy

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Re: Maybe moving mom into duplex... crazy?
« Reply #13 on: March 18, 2015, 10:07:57 PM »
Yeah.  You'll probably end up with less out of pocket renting it to someone and subsidizing her than renting it to her.
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pminkler

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Re: Maybe moving mom into duplex... crazy?
« Reply #14 on: March 19, 2015, 06:21:22 AM »
Yeah.  You'll probably end up with less out of pocket renting it to someone and subsidizing her than renting it to her.

Sounds about right.  Thanks for all the help!  I'll help her look into those above programs and see if we can find a different situation!

partgypsy

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Re: Maybe moving mom into duplex... crazy?
« Reply #15 on: March 19, 2015, 10:36:09 AM »
I would only do it if you can afford to keep the duplex with her paying nothing and you are OK with her paying nothing, because I can tell you right now, that is what is going to happen. And at that point are you going to kick out your own mother? You might be legally entangled at that point.
I would also agree with others to not bring this up as an option and see what other public programs are out there for her. I myself will probably need to be doing this at some point with my mother. Instead of Forex trading her problem is supporting an alcoholic son.  It is a really thorny problem because as long as he is in the picture I cannot help her in any meaningful way, and he is basically taking her down with him (financially, psychologically, etc).

Part of the issue is I bet your mom thinks you are her fall back position. You need to have an honest conversation with her about her situation, and that for your own financial good you cannot provide a free place to live, and to help her look for alternatives. If you have time if you can help her go through stuff and get rid of things that would also be helpful to her as she will probably not be able to afford a monthly storage unit fee to store it all.

GizmoTX

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Re: Maybe moving mom into duplex... crazy?
« Reply #16 on: March 19, 2015, 02:13:00 PM »
How soon can you get another tenant for your duplex?

pminkler

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Re: Maybe moving mom into duplex... crazy?
« Reply #17 on: March 20, 2015, 06:26:52 AM »
I would only do it if you can afford to keep the duplex with her paying nothing and you are OK with her paying nothing, because I can tell you right now, that is what is going to happen. And at that point are you going to kick out your own mother? You might be legally entangled at that point.

I could definitely keep the duplex with her paying nothing...it's "just" losing $7800/yr (or in Mustachian terms, $111800 over ten years).  Nobody wants to do that.  She just sent me an email saying that she would have no problem paying rent, even after post-65, as she would be making ~$1600/mo.  Minus the bare minimum...rent, utilities and food, that leaves her just $500/mo to play with for gas, anything else she needs and healthcare for an aging, disabled person. 

She says she's not worried about rent, she's worried about healthcare lol.  Like, helloooooo obviously the healthcare is going to come first, and rent is going to be late or never there.  I think she's just telling me what I want to hear.  It feels like I'm getting sold something.  I offered help countless times to help sell her stuff, told her to get out of an obviously toxic relationship that ended in turmoil and a lost house, told her not to do the Forex stuff, told her to return her computers, get a small apartment after selling the house...took absolutely no advice, but she's completely fine taking money.

How soon can you get another tenant for your duplex?

Not very.  I'm in the middle of remodeling the upper for myself.  Since mom is disabled, she requested the lower apartment.  I know, I know... kicked out of my own apartment and she'll barely pay rent some day.  But, the upper DID need a lot of help, and I like the upper anyway...a tenant was up there when I bought the place, though.  Once it's all said and done, this area is hot for renters.  Could probably fetch $700/mo in about a month of looking.  Upper could be around $800/mo after remodeling.


Stachetastic

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Re: Maybe moving mom into duplex... crazy?
« Reply #18 on: March 20, 2015, 06:37:41 AM »
I definitely feel for you, OP. I am in a similar position, with my mother diagnosed with fibromyalgia and declining quickly. However, she is not yet even 60 and not on disability. I have encouraged her to apply, but she is resistant. She works in real estate and loves it, but it's obviously not consistent pay. We moved her into one of our rentals this winter, after she split with her husband and shit hit the fan. She didn't even have the credit or the money to put a deposit on a rental, so she literally had nowhere to go. My grandmother told her she couldn't live with her. So what to do? We had a rental sitting empty between tenants and couldn't say no. I know many people will say it was a bad financial move (and it is), but we couldn't send her to the homeless shelter, and she sure as hell wasn't moving in with us. This all culminated with a stint in the psych ward for her, as well. So all of this is to say that you're not alone. And sometimes decisions need to be made without finances being the only factor. I'm sending you good thoughts.

pminkler

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Re: Maybe moving mom into duplex... crazy?
« Reply #19 on: March 20, 2015, 08:16:40 AM »
And sometimes decisions need to be made without finances being the only factor. I'm sending you good thoughts.

Thanks... and sorry to hear that about your mom.  Wow, doing real estate work and having fibromayalgia must be hard.  She's a tough one.

Yeah the way I see it, I'm going to have to subsidize her living anywhere she lives.  Having her in my rental does cost lost rent (possibly, probably), but it may be cheaper than a place that gives round-the-clock care...where she'll likely end up.  She's so feeble most of the time, that I can't see her doing much of anything in her 70s, 80s and beyond.  Better than I can give her a safe house.  Obviously I'll encourage her to apply for every single benefit out there, which I'm sure she'll have no problem doing.  I can also keep an eye on her and prevent dumb things from happening.  Show her, by example, the good stuff in life.

I do get SOME benefits having her living there.  She's very good at DIY and can instruct me on various projects.  She can watch my dog when I'm away or need to stay late at work.  I'll probably never have to deal, legally/emotionally, with a toxic, problem tenant -- short of subsidizing her rent, she's super quiet and never goes anywhere.

I could just be brainwashing myself :)

jmusic

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Re: Maybe moving mom into duplex... crazy?
« Reply #20 on: March 20, 2015, 09:34:59 AM »
A few years ago, she must have been up watching infomercials and got into a day-trading thing, learning Forex trading and options...paying for classes to the tune of about ~$40k (which she didn't have) and immediately bought a new computer and triple monitors on credit for, I'm guessing, $3-4k.  She's been bankrupt before, and right before this, she was debt free.  Her plan was basically to go pedal to the metal to learn this stuff so she can trade at home when she turns 65 and loses her disability.

Be afraid... be very afraid.   

One statistic that I've heard (and am a part of myself) is that NINETY PERCENT of Forex traders are forever unprofitable.  I've lost probably $15K over my lifetime trading Forex, and consider myself lucky.  The high leverage attracts the "Get Rich Quick" crowd, but it usually ends up as "Get broke quick."  Systems traders fare little better, because it is very easy to build a system in back tests that looks like a sure fire money maker, but falls flat on its face in real trading.  Many Forex brokers are even ACTIVELY TRADING AGAINST THEIR CLIENTS, and they pull all sorts of shenanigans to help traders lose money. 

What's worst is that she has spent big money in training and has a $40K hole to climb out of before even STARTING!!  And how much funding is she prepared to commit to trading?  If she had a $100K account it would require 40% profit just to break even!  It sounds like she's already been brainwashed and at this point all you can do is limit the damage.