I guess I don't see the reasoning behind upsizing for the 1 or 2 visits a year.
YES. I see this all the time and not just among Boomers. People have been hosting large family gatherings in apartments since the olden days, and sometimes apartment dwellers even host overnight guests! Wow!
I get both sides of the "space for the holidays" argument. A hotel isn't the same for us. This is part of the larger problem of delayed launch/squeezed generation is they're not as prepared to absorb the burden of hosting.
I would be thrilled if my parents decided to downsize to a two-bedroom condo. Oh, what's that? The entire family can't visit at the holidays? Only one child and his or her family at a time? You mean the whole family would never again be able to stay under one roof? Oh, what a shame. /sarcasm
This is why my mom is buying another Suburban despite driving alone 80% of the time (the other 19% being with my dad). Because what if 9 people in our family need to go together!!?
My mom has a Ford Explorer. For her, my stepdad, and their Maltese. At last year's Christmas of Doom, she asked if we could bring our coffee maker because they "didn't have room" to pack theirs. Ummm...we drive a Honda Fit.
Wait, I thought you didn't have to inherit parents' debt, is it if the estate can't pay it off? I'm sweating bullets now, b/c my parents are up to their eyeballs in mortgages, seconds, home equity loans, etc.
Options and timelines cary by state but you can't be forced to inherit anything.
“People who lived through the Depression wouldn’t think about retirement without having all their debt cleared,” he says. “Boomers are not only fine with it, but prior to the crash, they tried to retire with a lot of debt. We had people trying to retire and build that dream home of 15,000 square feet. That is somewhat unique to baby boomers.”
Say what? Why??? What is the point of this? I thought it was typical to look forward to the empty-nest years and stay where you are or downsize, not build a gigantic new home that you'll be too old to maintain the way it needs to be maintained.
Geez, this boomer vision of retirement gives me hives.
My grandmom did something I find BEYOND stupid. She had a new house built locally with my financially irresponsible aunt. *shakes head* I knew this was a bad idea and it hasn't come back on her yet, but my 72 yr old grandmother should NOT be doing this. She basically did it so she can sell her house in Oregon and move here to retire.
I can't tell you the number of times I've tried to tell her to just say no to my money grubbing cousins and aunts. They are grown ass women. They can work for what they want.
Back to the article - I can't understand why this isn't common sense not to take debt into retirement. I have no plans of having any debt then. My house will be paid off and we've discussed possibly renting it out and downsizing to maybe a retirement condo thing. But, even that consideration is around a rental condo. Certainly not a mortgage payment.
I don't, either. I would think you could set aside a portion of the increased costs to put people up in a hotel and still come out ahead. I could see not downsizing for that reason and maintaining the status quo as long as possible (which is what my mom seems to be doing with her house), but I don't understand taking on more.
We are in a 2-bedroom rental apartment. I think we're going to want to have a baby before we can realistically buy a house or upgrade to a 3-bedroom rental. But our management company can get us a good deal on a hotel one mile away, so I think it makes more sense to stay where we are and set aside $1,000/year to get hotel rooms for visitors than to spend thousands and thousands we can't afford just so we can have a guest room for 12 nights a year.
We have a 3 bedroom house (master, guest hypothetical nursery office) and our logic is that if all the rooms are full we don't have to host people. There is a hotel 2 minutes away. We don't have to host people, they get their space, win all around.
This is also why we haven't been rushing to hang a door on our guest room. It helps when people want to "crash"; they usually change their mind.
*nods in agreement*
Chile, before we had the baby we had a guest room. My curmudgeonly grandmom stayed with us dayum near a month. Now, I can't offer sleeping space because ain't a place for you to sleep. (Well, the man cave, but the H ain't going for that).
Post by simpsongal on Sept 8, 2015 14:52:39 GMT -5
Yikes, this makes me happy my retired folks 64 and 63 paid off their home.
Not retirees, but sometimes I wonder about the upper 40/50 somethings buying the $1.5 million new builds in this area. I guess some of them have big money or bring money from the sale of another home (even so, how much equity could you get, $300K?). I'm guessing there are plenty taking out big 30 year mortgages to bank role these houses. Even w/low interest rates, I can't imagine having a $5-6K mortgage every month into retirement.
Back to the article - I can't understand why this isn't common sense not to take debt into retirement. I have no plans of having any debt then. My house will be paid off and we've discussed possibly renting it out and downsizing to maybe a retirement condo thing. But, even that consideration is around a rental condo. Certainly not a mortgage payment.
My folks took a few retirement preparation classes offered by the local government or high school. The people in class were shocked, SHOCKED by the idea of paying off debt before retirement, especially the mortgage.
Also, most of the people in the class, my folks included, didn't realize 401K withdrawal were taxed upon withdrawal.
Say what? Why??? What is the point of this? I thought it was typical to look forward to the empty-nest years and stay where you are or downsize, not build a gigantic new home that you'll be too old to maintain the way it needs to be maintained.
Geez, this boomer vision of retirement gives me hives.
There's a commercial for some real estate site that has a woman with a small child helping her mom find a new house. She ends up with a huge house on a lake and everyone is so excited. Every time I see it, I wonder how excited everyone will be when the mom can't handle the lake house anymore and they have to drive up every weekend to help her instead of swim.
"Dad would love it."
My BIL's father recently passed away and he and his wife, who predeceased him several years ago, bought a small ranch home in the 60s. They did well for themselves and over time, they bought each of their adjacent neighbors' homes. They knocked those down and added onto their own house. It also doesn't appear that they ever did a major purging of any kind (I think the best example I can give is that in the den, there were at least 50 of every kind of music format that ever existed--albums, 8-tracks, cassettes and CDs). The house is massive and full of stuff that my SIL and BIL now have to sift through, donate, trash or keep. I was getting exhausted just walking through the house, never mind taking in all of the stuff. Even all of BIL's mom's things were never touched, clothing, shoes, perfumes, makeup, all of it, still there. It made me think that I hope for my DS's sake, I remain forever, a frequent purger. I hate having too much stuff around and I hope that doesn't change when I'm old.
Say what? Why??? What is the point of this? I thought it was typical to look forward to the empty-nest years and stay where you are or downsize, not build a gigantic new home that you'll be too old to maintain the way it needs to be maintained.
Geez, this boomer vision of retirement gives me hives.
MIL can't afford the house she's in now. It's too big, too expensive. Yet she doesn't want to give it up. We've talked to her about getting a 2 bd condo or something. Nope, wants a house.
If my MIL says one more time, "I can't live anywhere with shared walls," I might catch a case.
My parents are moving in with us, we're building an addition onto our house so they have their own apartment. At least 60% of my reason for this was so they would have to clean out their house now, while they're still healthy, and I wouldn't have to do it alone after they die. I'm an only child and they're 7 hours away, no one has time for that shit.
I have a 1400 sq ft single family house with a 1 car garage on 1/10th acre of property. The previous owner lived here until she was 97, and now she's in an apartment.
I want to move to something bigger someday, but I kind of want to keep this house and maybe move back for retirement. So rent it out for a decade or two. Of course, all of the bedrooms are on the second floor and there are steps to get in both the front and back doors, so it's not very accessible for anyone with mobility issues, which is a real threat in retirement.
Thankfully, this is one area in which my dad ROCKS. He has cleaned out way too many old people houses. Like his parents' house. That they built and lived in for over 50 years. And had a full basement full of tools and, like, scrap copper and shit. He is the opposite of a pack rat. Almost a minimalist, but not really - he has stuff, it's just exactly as much stuff as he needs and culls every year. If he hasn't used an item in the past 24 months, it goes. AND he lives in a 2 bedroom, 1 bath, 1050 sq ft house on a lake. He will pay off the mortgage (which is not much) in the next few years, then retire.
My mom thinks my dad is a heartless bastard for living in a 2 bedroom house, so his kids can never move back. I would like to point out that 1) this house he owns was our summer property growing up and was actually in my MOM'S family for 80 years, so it's not like a random decision on his part, and 2) my mom lives in a 2300 sq ft 3/2 single story house and can't deal with less than 2k sq ft because she needs enough bedrooms for her kids and non-existent grandkids, her husband's literal 10 book cases full of books, plus computer equipment, her sewing stuff, and her massive dining room furniture. Which isn't even antique or anything - her husband bought it 10 years ago.
Thankfully, I once talked her out of the 3500 sq ft, 5 bedroom, 4.5 bathroom, 3 story house. But who knows what she'll do in the future? Probably move in with me when she runs out of money. She CAN fit her dining room furniture in my dining room.
My parents are moving in with us, we're building an addition onto our house so they have their own apartment. At least 60% of my reason for this was so they would have to clean out their house now, while they're still healthy, and I wouldn't have to do it alone after they die. I'm an only child and they're 7 hours away, no one has time for that shit.
Thankfully, my in-laws are currently cleaning out the garage and attic so they can treat for termites. Because dear god, I do NOT want to have to sift through all that. Also, thankfully, for now, both my husband's sisters live much closer than we do.
If MIL outlives FIL, I can see her getting a 1 story condo eventually. They have a split level, but she has a bad back, and I think downsizing and getting rid of all stairs would be nice. But she's also currently planning a kitchen reno, so who knows. If FIL outlives MIL (he's 8 years older, but his mother also lived to be 99), all bets are off. The house would probably qualify for an episode of hoarders if he lived alone.
My parents took out a 30 year mortgage when they were 57 and 60 years old. Why would someone give a 30 year loan to someone that old? They will never be able to pay that off! My mom doesn't work (and hasn't in over 35 years) and my dad plans to work until he dies. What happens if he can't work? What happens if he dies first? And why am I the one asking these questions, and not their bank or themselves?
My mom hopes to become a first-time homeowner (condo) in the next year or two. She's 52 years old now and I don't disapprove of her doing this because the rent is too damn high (buying would be cheaper) and I am concerned about her ability to pay rent during retirement. She's been working like a fiend to save up as much for a down payment as she can so that her mortgage is minimal. But I honestly didn't think she could qualify for a mortgage so I did some researching and essentially, you can't discriminate on someone applying for a mortgage based on their age.
See, my parents already owned a home. They could have bought a home that was a lot nicer than the one they lived in at the time for $100,000 more. They could have paid that off, but is that what they did? Oh, no. They took out a $450,000 loan AND took money out of their meager retirement savings to buy a house that was several times more than their current house. They will never, ever pay that off. Someday it's going to be my problem, and that kind of pisses me off. It seems like you should be able to take life expectancy into account when loaning money to someone. I guess I can see why that's not legal, but it doesn't seem right. And if you aren't going to take that into account, maybe don't saddle the person's kids with the debt after they die?
ETA: I just saw the PPs addressing this issue. Well, that's a load off of my mind.
The first thing my mother did after my father's estate was settled was to pay off their house. She's still living there, and she plans to say put in her paid off house until she's no longer able to maintain it. She retired recently, and not having a mortgage was a big factor in her decision to quit working when she did.
Meanwhile, my ex-ILs had a paid off home but decided they needed to be a newer, nicer place. They bought a 4 bedroom McMansion with a full basement to store their junk. At the time they had no grandchildren but insisted they "needed" the space. My ex was floored when they did this because his mother was retired and his father was really only working part-time. His exact words to me were, "I don't want to know what kind of absurd financing they did to make this happen." I used to dread the thought of something happening to one of them and us being asked to help out financially or help clean out all their stuff. I am so glad it's not my problem any longer.
Post by penguingrrl on Sept 8, 2015 20:54:28 GMT -5
I'm suddenly so grateful to my mother. She downsized from her house (now our house) a year and a half ago and went from a 1400 SF cape to a 2 bedroom townhouse. She's a big purger and is also living cheaply despite being nowhere near retirement. She never considered wanting or needing a bigger house, not even with three teenagers there. We're now in the house and aside from wanting to finish the basement as a family room and maybe dormer the attic we'll never consider anything bigger.
In other ways she's not where she should be for retirement due to difficult life circumstances, but she doesn't want or need a lot of living space, which will help us help her when the time comes.
Wait, I thought you didn't have to inherit parents' debt, is it if the estate can't pay it off? I'm sweating bullets now, b/c my parents are up to their eyeballs in mortgages, seconds, home equity loans, etc.
Options and timelines cary by state but you can't be forced to inherit anything.
What happens if everyone named in the will refuses the inheritance? Do they look at other relatives, or does the government claim it, or some other option?
I was thinking about this a bit more and I wonder if part of the reason for the increase in mortgage debt among seniors is that the interest rates are so low.
My parents sold their paid off house a couple of years ago and bought a new one. The put a lot down, but still took out a small mortgage because a) the tax implications of taking money out of their investment accounts and b) interest rates on the mortgage were so low compared to what they were making on investments. I know this is anecdotal, but they can't be the only ones who thought this way.
I was thinking about this a bit more and I wonder if part of the reason for the increase in mortgage debt among seniors is that the interest rates are so low.
My parents sold their paid off house a couple of years ago and bought a new one. The put a lot down, but still took out a small mortgage because a) the tax implications of taking money out of their investment accounts and b) interest rates on the mortgage were so low compared to what they were making on investments. I know this is anecdotal, but they can't be the only ones who thought this way.
They're definitely not alone. My mother's best friend is a very financially savvy woman. She has said that she will always have a mortgage because she feels she's better off investing than paying off with a low interest rate. She didn't retire until she knew she could live comfortably until age 95 and I know has well more than her mortgage in investments but chooses to keep her mortgage. It's been over 20 years since she's has any non mortgage debt and she said keeping the mortgage going is partly to ensure she keeps her excellent credit score, which just using a CC and paying it off may not accomplish (not positive if that's true, just what she says).
Options and timelines cary by state but you can't be forced to inherit anything.
What happens if everyone named in the will refuses the inheritance? Do they look at other relatives, or does the government claim it, or some other option?
It depends on the jurisdiction and the type of asset you're talking about and whether it is encumbered by a lien.
Is there a single jurisdiction in the United States where someone not a spouse or co-signer assumes the debts of a deceased individual?
ETA: According to this, you may be responsible in a community property state (but under what precise circumstances?) or if you were legally obligated to resolve the state in some way and failed to comply with certain laws.
It depends on the jurisdiction and the type of asset you're talking about and whether it is encumbered by a lien.
Please be more specific. Where and when and in what situations are people required to take on the debts of a deceased person who is not their spouse or co-signer? Thanks.
perhaps I misunderstood the question, but it looks to me like it is asking what happens to disclaimed property.
ETA: IE- "to my great granddaughter I leave the godawful bust of myself in the hallway" granddaughter doesn't want it. What happens to the bust? Or: "I leave the house to X." Testator doesn't have any equity in the home and the estate is not inclined to pay it off. X doesn't want it. What happens to the house?
I guess I don't see the reasoning behind upsizing for the 1 or 2 visits a year.
Depends on the family dynamic my Mom lives having us all home and usually it happens 4 or so times a year. And probably 2-3 other times a year at least 2 of us are there. She's still in the same house so we each have a bedroom and DD sleeps in our room (which honestly sucks) if my brothers had kids this would be really uncomfortable. So while I think it's poor planning I can see why certain people want to do this.
perhaps I misunderstood the question, but it looks to me like it is asking what happens to disclaimed property.
Maybe we both did, I was stuck on the earlier question and wondering if Imma have to go to NC and act the fool cause I am not paying any of my mama's (few) debts with my monies. Come at me bro!
Don't let me freak you out because that is not what I was saying at all. I'm still really sorry about your mom. Are you the trustee/executor? I'd imagine dealing with all of that from OOT is really stressful.
Don't let me freak you out because that is not what I was saying at all. I'm still really sorry about your mom. Are you the trustee/executor? I'd imagine dealing with all of that from OOT is really stressful.
No my aunt is executor but working closely with me. Thankfully the only debt my mama had is our house (it was mortgage-free for years and then she took out a small mortgage on it -- before she was 65 -- to do some upgrades and to help my brother with some of his bullshit troubles) and income taxes (still can't figure out how a retiree with a pension owed taxes) so it's not a big deal.
FTR I have zero problems with someone actually taking out an interest-only or little to no money down mortgage and dying a few years later. If you can get one why not? Especially since the obligation to pay the loan dies with you and it's not like a posthumous foreclosure can ruin your credit or anything. I just think it's probably not the most wise loan for a bank to be making.
I don't think all boomers are like this. My parents plan on having zero car payments and zero mortgage by the time they retire. I came into an unusual situation back in 2007 that allowed me to pay off my house so that's what I did. It is pretty awesome. Just need to get those student loans paid off and we are golden. My mom wants me to take out my retirement money to pay off my SLs but I don't want to so I'm going to increase payment once we get our e fund where I want it.