Submitted by turnip271 t3_11yqgoo in personalfinance
Hi all, I REALLY need some advice.
As the title states, my dad died and we are trying to figure out how to set my mom up with retirement and how to keep a roof above her head. Let me lay out a few facts.
- She owns a 3 bedroom 2,100 sqft home worth $725k 45 min from Seattle. They took out a 30 year (insane to me) mortgage pre COVID for somewhere between $400-500k.
- Monthly mortgage payment is about $3k.
- Life insurance received $25k. Was supposed to be $250k but he was let go from his job recently.
- Retirement of around 4k in single stock.
- Basically no cash/savings.
- Moms income is around $36k/year post tax as a 4 days a week school nurse. I am telling her she will need to begin working 5 days a week next year so hopefully that would bring it closer to 48k/year post tax.
- There is some CC consolidation debt that I am unsure of but believe it to be below $5k.
- She does has long term care insurance which may help later down the line if assistant living was needed.
Unfortunately the months prior to his passing I had been helping them get their finances in order finally. My heart is hurting with the timing of this.
My wife and I (27) make $150k together and live in a small townhome outside of Seattle that would not work for a multigenerational family. We are also trying to have our first child soon soon. This was bought for $425k and is now worth $472k.
My immediate question is what do we do with the house? She won't be able to pay the mortgage once the life insurance runs out and she doesn't want to live in that house alone forever. It is also about 45 min from us and ideally we would like to be closer.
I have thought about trying to find a property with a mother in law or ADU but I'm not sure if we could afford that now especially with current interest rates and availability. Both my mom and I also currently have low COVID level mortgage rates. This would be most ideal but I'm not sure if it is realistic.
Another option that was recommended to me would be finding a condo closer to us and seeing if she would be accepted for a reverse mortgage.
Another option would be selling the current home and taking out a new mortgage on a small condo.
Last option would be renting forever.
I apologize for my information vomit, I have never been the strongest writer so I hope I put this in some type of consumable way.
Please, if anyone has any recommendations or other ideas I am all ears. Even if anyone has any resources that may help me or just point out things where I may be wrong or confused. I am in my first year as an accountant so I have foundational knowledge but I feel so close to this with so many moving pieces I feel like I am drowning. My parents were amazing to me and I want to do everything that I can to help my mom have a comfortable retirement without jeopardizing my own family's financial future.
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EDIT: Wow, thank you all so much for your support and willingness to help. I never post and expected maybe 2 or 3 replies. I've been combing through ALL of your comments and most of you were so kind and genuine. We are starting to lean towards renting out our townhome and moving in with my mom for now. It is not a location I would want to be, but we may look at some little renovation to make the space more co habitable. We can do this in the short term (a couple years at least) while we wait until we are at a better income, and/or find the perfect next (hopefully) forever home. I tried to keep up commenting on all the posts but fell behind when they kept coming in so this is my reply to you all. THANK YOU THANK YOU THANK YOU :)