Thursday, August 05, 2010

Letter to brothers and sister

Sorry for the lack of formality brothers and sister. This is a problem we need to solve. To string it out endlessly and pretend it will go away cannot go on. Of course this is not for Mum’s eyes and not to be spoken about to her until we have a workable plan.


I directly confronted Mum, suggesting that her financial situation is not sustainable and had she thought about moving into a unit or a retirement home. She pooh poohed both ideas, as I knew she would and has in the past at any mention of such. Between us we have endlessly discussed her options, often with a good laugh, as it should be. We know all know what Mum is like. A friend suggested that if Mum has never had to budget before, she is not likely to start now. She hasn’t and she won’t now.


I have taken a look at her finances and from what I can work out, her fixed bills, electric, water, phone, rates, and insurance work out to about $100 per week. That should leave her $250 per week. Then there is the lawn mowing, $15 per week, less in winter. I expect the chemist does very well out of her, although she now buys many things at the Chemist Warehouse. Cigarettes and cat food must cost too. We all dislike the cats, but they give her some pleasure. Breeding season is about to happen. Maybe she will realise that one pet cat is practical, rather than a colony of them. Regardless, on paper, she should have enough income to survive, but life is not always like the theory.


Mum has been nagging me again about looking up about reverse mortgages and while we all dislike the idea of them, she owns her house and why should she go without when she has an asset than can be partly be liquidated?

She stated that she can manage but there is nothing spare left to ‘fix up the house’ or ‘if something breaks down’.

Given how quickly she went through Bone Doctor's $5000, I am not so sure that she can manage on a daily basis. Don’t forget that Bone Doctor will need to be repaid at some point, plus interest. Also note that Sister has been extremely generous with money for Mum. Sister, present your accounts to us at an appropriate time. Should the value of the house be eaten up in nursing home costs in the future, the debts to Sister and Bone Doctor stand.


Enough blather, here is what I propose.

The house rates have been paid not too long ago. We will pay the next, a bit over $1000. Round to say $300 each, perhaps next due about February 2011.


The electric bill is a killer. I am not sure of the hot water component (later update, it is a minimal part of the bill), but I know the old air con unit is burning money. I hate the thought of Mum being cold in the winter yet cold she is. I suggest we put in $500 each in the immediate future to buy an energy efficient split system. It will give her quieter and more economical heating and reduce her electric bill considerably and give her much more comfort. It will also be much better for cooling. If you don’t have the funds, I can wear the cost until you can repay me or it becomes a standing debt to me. We should look at getting the unit installed in spring. The only place I can envisage for it to be installed is above the existing unit. Tradie Brother, will the power supply be up to it? I think it will as it will draw less power than the existing unit.


She worries about appliances breaking down. Well her fridge did break down and a cheap one was sourced by A. So, can we reassure her that if a major appliance breaks down, we will pay?


Mum has realised how bad the northern side of the house looks. There are some spare weatherboards already there and some may need to be bought, but at the end of the day, it will be Tradie Brother's job to replace them. Perhaps we have a family working bee to paint them. So, Tradie Brother puts in the labour and the cost of more weatherboards and additional materials is divided among the remaining three of us. This, of course, is not so urgent.


If you think my suggestions have merit, then there is a quick upfront cost of about $500 each for the air con unit, and $300 next year for the rates. The rest we will work out at the time.


Mum is very determined to stay in her house, and if we don’t come up with a good option or assist her to get a reverse mortgage, she will get a reverse mortgage on her own. She is old, always fuddy duddy, but never stupid.

Email, phone, text or write your thoughts, but don’t wait too long. I need to present Mum with a sustainable solution to her financial problems.

Andrew.


I have full agreement from them all. Tradie Brother has teed up a friend to supply and install the aircon for $1800. ABI Brother says her rates are under $1000.Now I just have to inform Mother.

9 comments:

  1. Aw Andrew, I really don't envy you and the siblings with this one. We were lucky that my Nan decided of her own accord that she wanted to go into a retirement home. It's such a big deal for them, they generally want to hold onto their place for as long as possible.

    I hope that things work out with all the plans you have. It is lovely to see that you all take an interest in helping, some people just don't care for their parents at all :(

    ReplyDelete
  2. It would be a lovely idea to tell her she is on her own Fen, but we can't of course. Aside from wanting to, we are obliged but that doesn't mean having her live with any of us.

    ReplyDelete
  3. Well put and good outcome :)

    ReplyDelete
  4. Weatherboard house is not a good prop. for a reverse mortgage. And you'll have trouble keeping the money out of her hands long enough to fix up everything that needs doing. She'll fight that saying it her money and she can spend it anyway she wants. Voice of experience speaking here although my mum was sensible enough to do the fixing first but there were a few things that were non-negotiable.
    When the house is sold, the reverse mortgage is the first thing that must be paid, everyone else has to wait.

    ReplyDelete
  5. My earlier comment should say 'Aside from not wanting to,'.

    Just her to tackle now Jayne.

    She won't be getting cash Jahteh. We kids will work it between us. Tradie Brother reckons the house should be bulldozed and does not really want to work on it. I will get her to post the rates notice to me. What I do like are reversion mortgages. The company, well only one connected with Bendigo Bank at the moment, take a percentage of you house in return for an amount of money. They depend on the capital growth of the house to make their money. But they don't cover where Mother lives, for good reasons.

    ReplyDelete
  6. Before our mum died in 1993 (at only 66) I spoke to my four sisters about all putting in a cetain amount of money to help mum cope on the pension (she was very frail with end stage cardiomyopathy) She loved her little place and have to admit she was careful with money - but had a lot of medical costs. After Mum died i realised that out of the five of us her daughters only one other than i had actually been getting the money to her and they were all able. I felt so sorry because irealised she had not told us about those who weren't helping - so we assumed they were. Whatever you do make sure you follow it up which I know you will do. Do what it takes to keep her comfortable and happy within reason - because after she dies you will handle the grief better knowing you did the right thing. Mum and I were very close and she was funny and a happy person...I just wish I had made sure the others were helping and she would have not had to worry about money too much...I no longer feel guilty about this - but i did for a while...till I understood she knew how much I loved her and that I was doing my best.

    ReplyDelete
  7. That is disgraceful T. You didn't have much and I expect they had more. Still, you can sleep with an easy conscience.

    ReplyDelete
  8. Anonymous9:04 pm

    You know what is disgraceful? My Aussie friend, who lives in the States, recently found out that her eldest brother, who had control of their mother's finances while she was alive and was also Executor of her Will, had been skimming the cream for himself. Naturally my friend and their other brother are not happy and are trying to sort out the mess; not an easy thing to do when you live on the other side of the world. You hear of these things happening but never expect it to happen to someone you know. V.

    ReplyDelete
  9. That is bad V. It may be misplaced, but I do trust my brothers and sister. In fact all are inclined to err on the side of generosity.

    ReplyDelete