Briefly: mom is 90, owns her extremely modest home in an MCOLA outright and would like to (ok, mostly *I* would like her to, but she is coming around to the idea) move to a higher end, healthier, cheerier, serviced suburban rental I found on a nice plot of land closer to her friends for her final months, years or hopefully a decade or two. Here are her stats. She does not want to move to a CCRC. She cannot work, can no longer drive and has a number of medical conditions. She was never a spender.
Portfolio:
$939k in CDs and HYSAs. All fixed income. No equities.
Other assets: $1.6 million in a residential real estate portfolio. A car worth approx $24,000.
Income:
$7520/mo (pension, SS and rental income).
Plus $2500 - interest
= $10,020/mo
Debt: $0
Expenses: approx $14,000 per month of which $12,500 is a live in home health aide ($5500/mo is offset by LTCI on which 158k and 2.5 years coverage are remaining). So net of the LTCI her expenses are approx $8500/mo, most of which is the aide.
Other costs are cable, food, electricity, water, cable TV, pest control, real estate taxes, accountants fees, phone, dining out, household items, repairs, insurance, garbage collection, and medical (she’s on Medicare and they pay for most of her medical expenses).
How much can she pay for a rental ($5-6500/mo?) and should she spend down her cash first or sell one of her rentals. Or should she just stay put and hope her $ outlasts her? Thank you.
My thought is that she can pay up to $7,000 per month given her life expectancy, very slow rate of burning up her savings (actually she is even coming out ahead currently), and given her income. If she has a healthier home on the nice plot of land she might live longer.
Portfolio:
$939k in CDs and HYSAs. All fixed income. No equities.
Other assets: $1.6 million in a residential real estate portfolio. A car worth approx $24,000.
Income:
$7520/mo (pension, SS and rental income).
Plus $2500 - interest
= $10,020/mo
Debt: $0
Expenses: approx $14,000 per month of which $12,500 is a live in home health aide ($5500/mo is offset by LTCI on which 158k and 2.5 years coverage are remaining). So net of the LTCI her expenses are approx $8500/mo, most of which is the aide.
Other costs are cable, food, electricity, water, cable TV, pest control, real estate taxes, accountants fees, phone, dining out, household items, repairs, insurance, garbage collection, and medical (she’s on Medicare and they pay for most of her medical expenses).
How much can she pay for a rental ($5-6500/mo?) and should she spend down her cash first or sell one of her rentals. Or should she just stay put and hope her $ outlasts her? Thank you.
My thought is that she can pay up to $7,000 per month given her life expectancy, very slow rate of burning up her savings (actually she is even coming out ahead currently), and given her income. If she has a healthier home on the nice plot of land she might live longer.
Statistics: Posted by AnnetteLouisan — Fri Sep 27, 2024 7:58 pm — Replies 0 — Views 86