I have a thorny issue. I am an only child living outside the U.S. with a non-American partner. My mother was widowed last year and is living on her own. She has about $50,000 a year in retirement income, a modest home with no mortgage worth a bit over $250,000, about $100,000 in cash, and over $1 million in investments. She is elderly with serious health problems and I am the sole heir. Much of the estate has been designated as transfer-on-death to avoid probate.
However, in my country of residence I would be held liable for substantial inheritance tax, which may total up to $400,000 if she were to pass with this amount of worth. I have told her numerous times to use whatever she needs in order to have a comfortable life, but she still adamantly refuses to get in-home help or move to assisted care. Relatives have been helping out, but I am considering going back to help for a time, as much as I can.
“‘I don’t really mind cooking and doing errands for her, and my partner is supportive. But to do this, I would basically have to give up my jobs here.’”
I don’t really mind cooking and doing errands for her, and my partner is supportive. But to do this, I would basically have to give up my jobs here, and there would be various other costs such as having to get temporary insurance in the U.S. I don’t really want to move back to the U.S. permanently and ask my partner to give up their business in the process.
Is it financially better for her to pay for in-home care and for me to continue working, or for me to go back temporarily and help her? She is already giving my partner and me about $10,000 a year each, which is the tax-free limit on gifts in our country, in order to lessen the pinch of inheritance tax. However, if I were not able to work, I would need more monetary support, and have considered asking for her to pay our rent directly, which would be another $10,000.
At $30,000 a year, that would still be less than paying for a caregiver or entering a facility, but I worry about the long-term effect on my career as well. Can you provide some perspective?
Your mother is being very generous in gifting you and your partner $10,000 a year each.
She has not asked you to move home. She does not expect you to move home to the U.S. You can, I imagine, visit your mother at least once a year, and check in with her over FaceTime or Skype. If you decide to move home, it should be because you want to spend time with your mother — and that will either override all other career considerations, or it won’t. It may or may not be an easy decision for you, but you should make the choice based on what you believe is best.
I can’t tell you that you should give up your job, or that you and your partner should move back to the U.S., or you should move back for a time without your partner (if that were possible). Seek tax advice in your country of residence today. When I am faced with a difficult decision, I look 20 years ahead and ask myself, “What would my older self wish I had done?” You get a better perspective when you look at your life in its entirety, free from the minutiae of everyday life.
Your mother is comfortable and has enough money to see her through the end of her life, with the right management and planning. There is a lot you can do for her from overseas, including enlisting the help of an estate lawyer and CPA. Explain to her that planning ahead rather than day to day helps to avoid firefighting in the event of a medical crisis. It’s better to be prepared. It gives you all peace of mind in the present. Full- and part-time care needs to be formalized.
Visit your mother to get a sense of what her needs are and her current medical state. What is the condition of her home? Who does she have managing her financial affairs? Does she have a medical and/or financial power of attorney? Upon reading your letter, Patricia Tobin, a certified elder-law attorney based in San Rafael, Calif., and fellow of the National Academy of Elder Law Attorneys, says you need to get an idea of what your mother wants.
“‘What is the condition of her home? Who does she have managing her financial affairs? Does she have a medical and/or financial power of attorney?’”
Depending on where your mother lives, in-home help likely would not exceed $30,000 a year, Tobin says. But it’s a 24/7 job. “If all she needs is what he is prepared to give — cooking and errands — in many locations $30,000 would be enough, but assisted living suggests that she needs or will soon need a lot more than that. Is the writer willing to change bedding and diapers, wake up at night, deal with all kinds of issues?” Tobin says. “Plus, no one can work 24 hours a day.”
“Caregiving is an act of love or duty,” Tobin adds. In other words, it’s not for the faint of heart. Given that you are already wavering, it may be best to leave it to the professionals. It’s an emotionally and physically demanding job. Live-in caregivers make close to $30,000 a year, but it can be lower or higher than that, depending on the state and requirements.
If you are worried about your job and life, you have answered your own question.
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