Dealing with $$ and aging parent - when to tap investments?

[Anonymous]

Anonymous wrote:"Sounds to me like brother is preserving principle of the investment for himself. Sorry, but there is no reason to not start drawing down the principle for an 89 year old woman. In fact, it's the smartest thing to do."

As long as they are all okay with the scenario of the mother going into a nursing home that accepts medicare, as $200K is not going to cover much time in a home and once they run through the 200K that will be the only option.

first of all, medicare generally does not cover nursing home care-- medicaid does. Second, if 200k is not going to cover much time in a nursing home, then 18k (which is what they would save if they each contributed $100/month for five years) is really not going to cover much time in a nursing home, so it's hard to see that it will make the difference. (Also note that if they do use medicaid, they will have to exhaust her savings first, which means it's not clear that it's better for them to have spent that 18k out of their own savings first).

[Anonymous]

Anonymous wrote:

Anonymous wrote:"Sounds to me like brother is preserving principle of the investment for himself. Sorry, but there is no reason to not start drawing down the principle for an 89 year old woman. In fact, it's the smartest thing to do."

As long as they are all okay with the scenario of the mother going into a nursing home that accepts medicare, as $200K is not going to cover much time in a home and once they run through the 200K that will be the only option.

first of all, medicare generally does not cover nursing home care-- medicaid does. Second, if 200k is not going to cover much time in a nursing home, then 18k (which is what they would save if they each contributed $100/month for five years) is really not going to cover much time in a nursing home, so it's hard to see that it will make the difference. (Also note that if they do use medicaid, they will have to exhaust her savings first, which means it's not clear that it's better for them to have spent that 18k out of their own savings first).

Exactly. And please do not believe the scare tactics of the "medicaid nursing homes." Most nursing homes are a mix of cash pay, LTC insurance pay, and medicaid-pay patients. The care staff don't know or care about the difference and they are all pretty much the same, which is to say dreary. But then again, it's full of people who are waiting around to die. I do not mean to be harsh, but it's the reality.

[Anonymous]

OP here - all, thanks so much for the comments. You've all raised some good points. Seems like I need to do some more reading about Medicaid.

Right now the $200K yields investment income that supplements my mother's pension and SS and covers most but not all of her expenses (hence my brother's request for additional funds). She's in a retirement community she dislikes...although I think she'd dislike anything. She's having a hard time with the other residents and staff.

I can't help thinking that it might be a good idea to take some of the $200K, sell it, fund a stay in a nicer place with (hopefully) better food but also with a broader spectrum of continued care...so that if/when the time came, she could go to a nursing facility and even go on Medicaid...

I don't know...this is so hard...

[Anonymous]

OP, I was responsible for my mother's finances when a stroke left her incapacitated. I used her money to pay for her care, and would have continued to do so until her assets were exhausted, had she lived that long. I do not see any reason why you and your brother should be spending your own money to pay for her care, at this point!

Yes, please read up on Medicaid. There are a lot of rules about when it will kick in, etc. that you need to be aware of, especially if your mother still owns any property.

Good luck, OP.

[Anonymous]

Anonymous wrote:OP here - all, thanks so much for the comments. You've all raised some good points. Seems like I need to do some more reading about Medicaid.

Right now the $200K yields investment income that supplements my mother's pension and SS and covers most but not all of her expenses (hence my brother's request for additional funds). She's in a retirement community she dislikes...although I think she'd dislike anything. She's having a hard time with the other residents and staff.

I can't help thinking that it might be a good idea to take some of the $200K, sell it, fund a stay in a nicer place with (hopefully) better food but also with a broader spectrum of continued care...so that if/when the time came, she could go to a nursing facility and even go on Medicaid...

I don't know...this is so hard...

I am dealing with a (not-so old) parent who is in a nursing home now -- and working to get him on medicaid.
Please understand -- your mother will not qualify with $200,000.
She just won't.
She will not qualify if she has any assets.
Also, be aware that if she owns property -- she cannot "gift" it to you in order to qualify.
That is looked upon as fraud.
She would have had to have "given" to someone at least 2 years prior.
I know the medicaid possibility is something for 'down the line', but you should understand how it works if it came to that.
My parent was originally denied because he owns 40% of my deceased grandparents' home.
His brother owns 60%.
Whatever you and your sibilings do -- just be sure you are aware of all of the possibilities and qualifications for all of the care options out there.

[Anonymous]

Agree with PP. If she is going to run out of money, then better that she do it sooner rather than later so she can qualify for medicaid ASAP if she needs it. Save your money now and you can help her out later with extras. But you might just be staving off the inevitable by helping her now, and could mean huge expenses later if she needs to wait to qualify for medicaid.

[Anonymous]

Anonymous wrote:Agree with PP. If she is going to run out of money, then better that she do it sooner rather than later so she can qualify for medicaid ASAP if she needs it. Save your money now and you can help her out later with extras. But you might just be staving off the inevitable by helping her now, and could mean huge expenses later if she needs to wait to qualify for medicaid.

I agree and would only add that if she goes into a nursing home as a paying resident now, if she spends down all her money then as a resident in place, she will have first claim to any Medicaid beds that come open at that time.