I moved my mom from another state in order to take care of her. She wanted her own space and wanted to be independent, but as close to us as possible. So she took the money from the sale of her house, and put it into a small house on our lot next to us.
We put her house in my name for two reasons: (i) I’m her power of attorney and (ii) We wanted to make sure it was not in her name so she qualified for Medicaid, if it comes to that. More than five years have passed.
She has had huge medical challenges for many years which have all fallen on me. I still work, but I have earned less due to the time spent taking care of my mother. Plus, I pay her a monthly amount to give her spending money, as well as paying for water, cable, phone, yard maintenance, transportation and meals.
She has two other children. And she is very adamant that she wants everything divided equally. We have no sibling rivalry. She has three savings accounts. Two are transfer on death accounts for the other siblings. (She doesn’t want them to know she has set funds aside for them and that money is to be touched only as a last resort). She is very adamant about that.
The third account is held jointly with me. That’s her checking/savings account and we have agreed that it’s to be exhausted first. I could see that being exhausted once we end up with the cost of care to keep her in her home.
At her death, she wants the house sold and all proceeds split equally. There is no will and everything is titled to avoid probate. One sibling supplies help when needed, the other does nothing. Neither one lives close by. Both are extremely successful siblings, but not available to help.
Would it be wrong of me to repay myself for at least some of my expenses over the years before I split the sale of my mother’s house equally? My mother is adamant about splitting the shares equally. My siblings are aware of what expenses and upkeep I pay, but they may not want me to be reimbursed for the expenses.
It seems like you stand to gain in ways you’re not fully aware of. Firstly, if your mother’s house is in your name, you will inherit that when she dies. Secondly, you may also have “right of survivorship” on the jointly held bank account, whether you realize that or not. Assuming that your mother’s home constitutes a large part of her estate and your name is on the deed, you already stand to inherit a healthy sum of money. Likely, quite a bit more than your siblings.
But your letter also raises important questions about the division of labor in a family caring for an aging parent, and what arrangements should be in place for reimbursing that person for lost wages, time and expenses. I have received many letters from children in similar situations. One woman secretly charged her mother $20 for driving her to the grocery store, and I warned her that she could face legal issues later on.
The numbers are staggering. To say you’re not alone is an understatement. Nearly 10 million adults over the age of 50 take care of an aging parent, according to a recent Met Life report. The number of adult children caring for an elderly parent and/or providing financial assistance has more than tripled over the past 15 years. One-quarter of adult children, mainly comprised of baby boomers, provide some type of care for their parents.
The estimated lost wages, pension, and Social Security benefits are $3 trillion. For women, lost wages due to leaving the labor force early to take care of an elderly parent totals $142,693, while the impact on lost Social Security benefits is approximately $131,351. A “very conservative” estimated impact on pensions is $50,000, the report found. That comes to a grand total of $324,044 (versus $283,716 for men).
Something many care givers overlook: It’s also important to take care of yourself, too. “There is also evidence that care givers experience considerable health issues as a result of their focus on caring for others,” the report said. “The need for flexibility in the workplace and in policies that would benefit working care givers are likely to increase in importance as more working care givers approach their own retirement while still caring for an aging parent.”
Another point of interest for you and your mom: The principal residence for someone who is receiving Medicaid is often exempt when it comes to mean testing, at least up to a certain amount of home equity. In many states, that can be as much as $500,000. Asset limits also vary from state-to-state: in some states, it’s single-digit thousands, while New York has much higher limits, as the cost of living is higher there.
Money and expenses and responsibility and, yes, sacrifice should not be dirty words. Absolutely, you should look at your mother’s finances and how much you will need to take care of her. It may be that the money your mother invested in her current home may cover that. There are other ways to be paid as a care giver for a parent too: A private contract between you and your mom and tax credits, and there are Medicaid-funded programs.
Asking to be reimbursed for money and time already spent is tricky, but you should have an honest, resentment-free conversation with your mother about finances today. Once you have monthly costs, you can share them with your siblings and (in an ideal world) approach these financial responsibilities united as a family. Whatever you decide, be transparent about the challenges that lie ahead and make it a joint decision. Your mother will surely benefit from that.
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