Author Topic: ideas to help mom  (Read 6525 times)

4tify

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ideas to help mom
« on: November 12, 2016, 09:09:34 AM »
Hi all

My mom is 75 and she is rather poor with her money and typically leans on me now & again for help. She has a pension & SS but often overspends and comes knocking on my door when that happens. I keep a tight reign on the leak from my own resources, but I've found you really can't teach an old dog new tricks. Plus she's my mom and although her lack of mustachianism can be frustrating, she made plenty of sacrifices for me. She's in good health generally and typically leans on me for around $1-2000/yr.

I'm trying to figure out how best to create a designated income stream that I can pull from that will both help her and that I'll "inherit" once she's gone, or just simply for her to use up. I'm wondering what you all think. Here are a couple ideas I've been kicking around. The idea would be to use $10,000 as a baseline investment (I may do more but for simplicity this is how I'm running the math).

1. Purchase a cash flowing investment property with the idea of generating appx $100/mo after expenses
2. Put the cash at Ally and earn 1% and just pull off of that as needed and hope it lasts 5-10 years or so
3. Purchase a high yielding bond fund such as VBLTX. This has a 3.58% SEC yield which would generate around $80/mo. I could pull off of it or reinvest as needed. To help with taxes, is it possible to open and IRA in her name? Does anyone know?

Any other strategies or thoughts you all have would be appreciated. Does anyone else share this issue btw?

Thanks!

« Last Edit: November 12, 2016, 09:12:49 AM by tmitchell »

SJS

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Re: ideas to help mom
« Reply #1 on: November 12, 2016, 09:42:15 AM »
Just curious do you know the amounts she getting in SS & Pension?  And WHAT is she overspending on?  Is she strapped to pay her utilities/rent, or is she struggling to buy another purse or pair of shoes?  I would suggest sitting down with her to first off find out exactly where every dollar is going.  Does she have any debt? Because if she does, you may not be "inheriting" anything.  If you could review her finances, maybe you'd find a few holes there to plug - does she even need cable TV? Or could she get by with a cheaper cell phone plan?  I'd definitely go this route before you started dedicated some of your hard-earned money to her "'overspending." 

soccerluvof4

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Re: ideas to help mom
« Reply #2 on: November 12, 2016, 10:41:40 AM »
^ yea more info. If your only talking a thousand or two a month sounds like some responsible cuts would take care of it. Maybe handle her finances and give her an allowance for spending every week.

4tify

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Re: ideas to help mom
« Reply #3 on: November 12, 2016, 12:12:20 PM »
Her overspending is usually on fluff, which I don't help with. It's more for events like vet care & health care or auto problems etc.

I have had many conversations about her finances and offered to take them over but she doesn't want to lose control.

Linea_Norway

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Re: ideas to help mom
« Reply #4 on: November 12, 2016, 01:27:42 PM »
Is there any way in which she could generate some extra income? Like renting out a room to a student.

4tify

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Re: ideas to help mom
« Reply #5 on: November 12, 2016, 02:28:19 PM »
sadly no, she lives in a 1br apt.

Lulee

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Re: ideas to help mom
« Reply #6 on: November 14, 2016, 06:00:49 PM »
Of the three ideas, number two seems the simplest (I believe she's too old for you to set up an IRA for her).  You'll have a small tax impact with the interest but that's certainly going to be less work than managing an income producing property.

That said, I suspect this is not going to be sufficient in the long term.  If she's not managing her funds adequately now so she can handle expected though irregularly spaced bills, she's not going to do better in the future and likely will turn more often to you for financial stop gap infusions.   Not knowing her, it's hard to say, but if it were my mom and she knew I budgeted X dollars a year to help her, she's be inclined over time to count on that as if it were part of her income and there would be requests for "emergencies" above and beyond the initially planned amount.

Rather than offer to take over her finances which would understandablely make her feel childish and out of control, could you offer to help her find ways to minimize her standard expenses so she could set X dollars of her own into a rainy day account?  Cutting a few bills by just $10 a month gives her the same amount as she's been hitting you up for and any genuine emergency beyond that, you could turn to the interest from the bank account you set up.

Best of luck!

4tify

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Re: ideas to help mom
« Reply #7 on: November 14, 2016, 06:43:30 PM »
Thanks Lulee! You're the only one who's actually chimed in about the best way forward, so I appreciate that :)

I understand how the responses here are meant to be clean and save me from another person's bad behavior, and believe me I've tried to sort through this a number of ways including cutting expenses etc. However, I do know I'm going to get hit with some expense sooner or later, which is why I thought it might be a good idea to put some money to work to help with the situation.

Thanks again for chiming in.

Lulee

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Re: ideas to help mom
« Reply #8 on: November 14, 2016, 07:06:35 PM »
I'm glad to help, even if by letting you know someone else can empathize.  My mom's a similar age, living on just SS (the pension stopped when Dad passed two years ago), has just run down house and a small stance of maybe $25,000.  Worse, my older brother is again living with her with his wife though for the first time, he's paying just enough to not be a financial burden.  She's careful most of the time but can't get ahead because of the housing costs.  She's trying to sell but can't make enough from it to get a place with everything she wants for the three of them and won't scale back.  I don't mind helping her a bit but refuse to support my leech of a brother so end up doing less than I would like so as not encourage doofus to drain both her and me.

She doesn't mind so far my helping with finding cheaper things like her Part D plan which she just changed to a savings of nearly $15 a month.  She doesn't always go for my money saving suggestions, partly I think due to preferring to not change what's familiar and partly due to mental exhaustion of not wanting one more thing to consider and decide.  I try to time suggestions to when she's energetic rather than tired and that seems to help her be open to possibilities.  Maybe you would find something similar would help!you help your mom.

I've often said, parents are the hardest critters to raise  😁 so hopefully with help from others in the same boat, we can keep our composure and our sense of humor.

4tify

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Re: ideas to help mom
« Reply #9 on: November 14, 2016, 07:14:26 PM »
Ha! Yes parents are very tough children! My mom thinks she's poor even though she actually gets a decent amount to live on. I've tried to coach her on being more sensible but she's quite stubborn. I'm basically all the family she's got, so when emergencies strike I get the call. You're smart to try to time out the suggestions. Mine gets confused and very tired at times too, and nothing goes through. I'll consider that next time.

Hopefully your brother is helping your mom out at least beyond rent, etc. Sometimes just the socialization can be useful for older folks.

But yes, a sense of humor is required! Sorry about your dad. I lost mine about 8 years ago.

Lulee

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Re: ideas to help mom
« Reply #10 on: November 14, 2016, 10:28:53 PM »
I hear you on stubbornness.  And making it harder is if they get their back up when in a time crunch so they won't let you help work through the options to find the best long-term solution.

I'm a bit lucky in that mine figured out I was good hunting up the best value for things like cat food and flea & tick medicine online so she likes to have me hunt for bargains on lots of things (she HATES using the computer so gladly delegates).  As I'm over there weekly and calling most every evening, I have a good sense of what she might be needing.   If I see a sale on something I know she uses, I'll check to see if she's like to grab it or wait until later.  She also had me help with taxes and the check book balancing for a while until she was comfortable with it which gave me insight into her finances without either of us feeling I was being nosey.

Would your mother be open to you bargain hunting for her?  I get cat food from Amazon for example because it saves a few dollars on the big bag while local prices are up and availability down.  I find she's more likely to let me help her if I ask something like "Would it help if I checked online for a better deal?".  It's often a matter of how I phrase it as well as timing it to when she's not tired.

Mom likes having my brother around, partly because she's never lived alone in her nearly 75 years, and partly she feels like he can care for certain things she can't/doesn't want to.  I forget the value of that sometimes.  But as he doesn't pay even half the housing costs, I get pissed at him for not making it easier on her at a time of life when she could use a bit of comfort.  She's trying to live on about $13,000 a year with property taxes eating up nearly $4,300 of it.  Him stepping up and paying a fair share of the costs would make a tremendous difference in her finances.

At least she has a very active church life with lots of friends who she spends loads of time with.  Plus she has some very good neighbors too.  If she had a bit more money coming in or a lot less going out, I wouldn't worry about her hardly at all.

I'm sorry about your dad too.  Even though I'm not an only child like you, I can imagine how responsible you feel for her well-being now she's a widow and on her own.  Keeping a balance of helping without enabling some poor financial or other behavior is indeed a  struggle.



4tify

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Re: ideas to help mom
« Reply #11 on: November 15, 2016, 08:06:10 AM »
I'm laughing about the computer. Same here. Mine also insisted on contracting internet service/wifi at home because she refused to believe me that her iPhone "can open the internet"--after having one for 5 years! So she's wasting $50/mo or so on absolutely nothing. I still can't convince her otherwise.

Shopping for her on Amazon is a good idea. I'll give that a shot, thanks.

Your mom's property taxes are high! What state is that? I just had mine move to an apartment and, while she was somewhat resistant at first, she loves it. Plenty of neighbors to talk to etc. She doesn't have a robust social life like yours, which is really important. Gives them some one else to lean on! ;)


Lulee

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Re: ideas to help mom
« Reply #12 on: November 15, 2016, 01:26:49 PM »
Good on you getting your mom into a better living situation.  Unless her new pals are spendypants, you may find she doesn't come to you as often for money as she may not spend as much on fluff to help fill her days.  Hopefully they are all careful with their money, so peer pressure will help her keep miscellaneous spending to a minimum.

Property taxes here in NH are very high as we don't have any income tax.  It varies by town and hers is about to go up by a few more hundred dollars, mostly due to the school system.  When she first discussed selling her house, it partly was to move closer to her friends and partly to get somewhere with a lower tax rate.  Unfortunately, because of all the extras she wants on the new place, for example, to give a large workshop to my brother, she likely won't find she saves much more than $10-15 a month on the taxes (none of which he contributes to).

My Amazon Prime account has saved us a lot over the years.  If we can't find something locally at a reasonable price, we would otherwise have to travel an hour one way to get to another large enough city where maybe we could find it at a price we liked.  It started with small things like vanilla beans so she could make a new batch of vanilla extract.  It grew as I always offered to check on pricing for something she was complaining about availability or cost and often found I could get things cheaper for her.  She likes the idea of getting deals so that helps.

But she won't shop online herself, not even to just do a comparison of prices with local stores.  Luckily, when I go over each week, we can sit together at her computer to check things out and order any necessities.  As long as I do the work, she's content.

As your mom doesn't use the internet on her phone, could you help her find a more cost effective plan before her next renewal?  Last I checked, AirVoice had cheaper plans for just voice and data.  If you could shave off $20 a month there, I bet she's be tickled.  Especially if you can equate the savings to a bill like the yearly vet checkup.  Doubly so if you handled the changeover for her as then she wouldn't stress over doing it wrong.  If she's nearby enough for you to spend part of a day doing so, that is. It'd also give her bragging rights with the neighbors about how thoughtful and helpful you are in saving her so much money with something she might otherwise find overwhelmingly complicated.

I remind myself all the time that it's baby steps for both of us.  If she doesn't bite on a money saving idea, maybe I planted a seed for the next time.  Maybe I figure out a better idea for next time.  As you said in your initial post, they sacrificed for us and patiently trained us.  Now it's our turn.


Goldielocks

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Re: ideas to help mom
« Reply #13 on: November 16, 2016, 01:12:40 AM »
I vote for number 2.  Ally account.

With a twist-- can you have a small amount from her deposited to it automatically each month?  Even twenty dollars a month would help it maintain, and you can call it her emergency fund (that only you can withdraw from).

Slow&Steady

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Re: ideas to help mom
« Reply #14 on: November 16, 2016, 07:41:00 AM »
Can mom move in with you to stop paying rent/mortgage/property tax?

4tify

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Re: ideas to help mom
« Reply #15 on: November 16, 2016, 07:45:07 AM »
Can mom move in with you to stop paying rent/mortgage/property tax?

no unfortunately we live in separate states.

4tify

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Re: ideas to help mom
« Reply #16 on: November 16, 2016, 07:46:07 AM »
Maybe I figure out a better idea for next time.  As you said in your initial post, they sacrificed for us and patiently trained us.  Now it's our turn.

yep, yep. good luck to you :)

Fishindude

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Re: ideas to help mom
« Reply #17 on: November 16, 2016, 08:12:21 AM »
I dealt with a similar situation with my Mom.
First thing I did was get power of attorney and become her legal guardian so I could handle all of her money.   Got rid of any credit cards, took over her banking, paid all bills then gave her a cash allowance for spending.  It was a bit of a fight at first but once we got things working she liked it as it took a lot of responsibility off of her shoulders.  She also had a tendency to forget to pay bills, etc. which was troublesome.

Turned out she could pretty well live within her means, the credit cards were where the over spending was occurring.

4tify

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Re: ideas to help mom
« Reply #18 on: November 17, 2016, 07:51:05 AM »
I dealt with a similar situation with my Mom.
First thing I did was get power of attorney and become her legal guardian so I could handle all of her money.   Got rid of any credit cards, took over her banking, paid all bills then gave her a cash allowance for spending.  It was a bit of a fight at first but once we got things working she liked it as it took a lot of responsibility off of her shoulders.  She also had a tendency to forget to pay bills, etc. which was troublesome.

Turned out she could pretty well live within her means, the credit cards were where the over spending was occurring.

I tried to go down this path with mine too but she got upset and thought I was trying to control her. Her weakness is QVC (she can't get a credit card anymore due to bad credit thank god), which is where the extra usually goes. She definitely has enough to live on, even without being super careful. I haven't had much luck convincing her of the power of frugality, etc, because she always seems to feel victimized by it. For instance, I suggested she drop her cable channels to the minimum and she rallied against the idea because she "needs" all of those 900 extra ones! lol. I have managed to get her to let me set up some auto pay, which has been useful.

It's sort of why I said initially I haven't been able to teach an old dog new tricks.

Linea_Norway

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Re: ideas to help mom
« Reply #19 on: November 18, 2016, 02:08:33 AM »
Is it then an idea to tell your mum that from 2017, you will not contribute to her living cost anymore? If she can't get a credit card anymore, she can't get new debts. But of course she could end up having too little on her bank account to be able to pay her bills. Then maybe those bills should go to incasso instead of you paying for it. Maybe it will be a wakeup call for her. From what I understand is that she should be able to pay off an incasso bill in time, if she would just stop overspending.
I think that as long as you keep paying for her overspending, she has no reason to stop doing this. You are like a really nice credit card company, who let's you buy on credit and then doesn't require payback.
But I understand this is pretty hard towards your mother and it will mean that you're not being the nice dauther anymore. It might not be the best strategy, I don't know.

4tify

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Re: ideas to help mom
« Reply #20 on: November 26, 2016, 03:15:23 PM »
Is it then an idea to tell your mum that from 2017, you will not contribute to her living cost anymore? If she can't get a credit card anymore, she can't get new debts. But of course she could end up having too little on her bank account to be able to pay her bills. Then maybe those bills should go to incasso instead of you paying for it. Maybe it will be a wakeup call for her. From what I understand is that she should be able to pay off an incasso bill in time, if she would just stop overspending.
I think that as long as you keep paying for her overspending, she has no reason to stop doing this. You are like a really nice credit card company, who let's you buy on credit and then doesn't require payback.
But I understand this is pretty hard towards your mother and it will mean that you're not being the nice dauther anymore. It might not be the best strategy, I don't know.

True, true. I AM a really nice credit card company. Her vice is QVC, which pray on the elderly and will give anyone credit for their cheap crap. Otherwise she's totally locked out of credit.

I guess I'm just going to have to keep a firm hand on the rudder :)

accolay

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Re: ideas to help mom
« Reply #21 on: November 27, 2016, 03:54:18 AM »
Posting to follow (as a child of Boomers who don't get it).

Cassie

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Re: ideas to help mom
« Reply #22 on: November 27, 2016, 05:25:57 PM »
As a boomer I know you want to be helpful but you are enabling your Mom. I would not give her anymore $ and let her figure it out. Maybe she can move to a low income apartment. Here we have apartments for seniors that make too much $ for low income but struggle with competitive rent rates.  If your Mom did not have enough $ that would be different but she does.

 

Wow, a phone plan for fifteen bucks!