I have been watching my parents run on a mouse wheel with their bills. My mom takes care of my kids so I can work. I pay her $100 per week (which covers snacks for them and her gas money driving to and from school, but probably nothing towards my parents household income.) My dad makes a blue collar income. I think he is at about $30,000 per year. They have to buy health insurance through the government program. My dad is getting older (57) and the hard work of a labor job is starting to break down his body. He had a stroke about 5 years ago, and no other health problems since, but I just don't know how much longer he is going to be able to continue like this. Their house is worth about $230,000-ish. They pay a mortgage and a heloc, plus they are going backwards on credit card bills now.. They live a frugal life and really I can't even imagine what they could cut to lower their bills. I would guess they owe about $150,000.
I am a single mom with three kids. I make an ok income ($48,000) and my health insurance is covered by my work for my whole family, so I am definitely making out there. I am working on my accounting degree with the hopes of improving that income in time. My house is worth about $200,000 and I owe $50,000. I have a 30 year mortgage, so my payments are really tiny. I save about 20% of my income between my work sponsored plan and my Roth IRA. I also (try to) keep an emergency fund, with my goal at $10,000. It hasn't gotten there yet, but that is my goal. I have had to lend my parents money during emergencies that they have (a few trees hit their house and insurance covered most of it, but not the cost of tree removal, which ended up at $3,500, that they didn't have... things like that...)
I am trying to figure out if pulling the equity out of my house and paying off their debt/mortgage and owning their house outright would be a benefit to us. The way I see it, I will end up with the house eventually someday anyway (since I am an only child) and the 20% that I am putting towards retirement could instead be saved as equity in my parents house. Of course, if I decided to do this, I would talk to a lawyer and have my name on the deed and whatnot... but the way I see it, I could take the pressure off of my parents until their social security payments kick in. They only have about $70,000 saved for retirement.
I know my mom plans on getting a part time job once my youngest daughter is in school all day (next year), which will help a little, but she has been out of the workforce for more than 20 years, so I don't think she will make much of an income. They aren't very good at staying out of debt.... but with their situation I can see why. I can't just increase the amount I give my mom each week, since I feel like that will be steeling from my own retirement since it will be spent on daily expenses and not secured like having equity in their house. My house is in a less desirable neighborhood then theirs is and I think that over time the value of their house will increase more than mine will.
Is this just an all around bad idea? Thanks!