I am 72 years old and have $3 million in total assets. I was a single mother, and my son is now 26, works in government and has a serious girlfriend. I stay with my son when I visit him, Although I hate DC And I miss him when I'm in my apartment Southern California Very long.
When he moves in with his girlfriend, I should have my own apartment for at least $30,000 a year. I'm concerned that this won't leave me the money to buy somewhere else, if not Southern California, and maybe Florida, which is the closest, for another $30,000. I am healthy, although I have arthritis. I exercise a lot and eat healthy. I hope I can help with the grandchildren, even though I will be old, and I will want to help as much as I can.
Can I buy two apartments? I hope to live with them in my “mother-in-law’s” apartment one day if they move to the outskirts of DC, but not in the near future, unfortunately.
be seen: We're in our 70s, have $1.3 million in IRAs and $1.15 million in cash. But we have no idea what to do with the money.
Dear reader,
There are a lot of moving parts in this post, but if your goal is to be in two places, it's possible — with a lot of planning. What you need to do now is get serious about your plans and start making them, regardless of whether your son is married yet.
For example, you say you want to live with your son and his future wife, and help raise the grandchildren – is this on a full-time basis? Or do you wish to divide your time in the future whether you have grandchildren or not? There's no wrong answer here – many people don't live near relatives, and others enjoy living in one place half the year and another the second half.
Before you invest too much into the idea of living with your son and his future family, you should find out what they might want. Many families live with multiple generations, so this is certainly not unheard of, but if you have the assets to live alone and in close proximity, what will all parties involved value most?
What will your living arrangements and finances be like as well? It's not clear how serious your son and his girlfriend are, so it may be too soon to have these conversations with both of them, but you can try discussing these ideas with your son while you figure out your own plans. Just make sure you cover all of your ground.
Income versus liabilities
There are many factors that determine whether you can afford two apartments or not. And you won't be able to do real financial planning until you get some clearer answers. But you can start mapping out your vision for your retirement. Get a notebook or spreadsheet and list all of your income — Social Security, any pensions, your current withdrawals from retirement assets and anything else. Then look at your liabilities, which includes any debt payments, as well as the current expenses of renting or owning a home (rent or the mortgage itself, utilities, taxes, and insurance, to name a few). What does your internal and external cash flow look like, and how does it change when you change the variables for merging two apartments?
Do this research with an open mind. For example, you're looking at an apartment for around $30,000 in each area, which comes out to about $2,500 per month (twice). This could of course be in the form of a rent or mortgage. Do you want to do both – own one house, perhaps in the “prime” area you want to be in, close to your family, and then rent another house for a few months of the year, in a warm climate like California or Florida? (If you want a tax domicile: Florida has no state income tax.)
Fairness versus flexibility
If you own one home, you will preserve some of your assets by investing in real estate. Not everyone wants to own property, but they are stocks that you can benefit from in your older years, or leave as an inheritance to your family. And if you rent a place for a few months during the year, even during the winter months, you won't need to sign a lease, which could tie up your money for a year or more. You'll have more flexibility, and you won't have to worry about subletting either.
Either way, start tracking rental and home costs in places that interest you. Go to real estate sites like Realtor, Redfin RDFN,
And Zillow Z,
And get average prices for the types of places you're looking at, as well as an area's sales history to see how prices have inflated over the years. If you're not looking to buy or rent a couple of places right away, these numbers will likely fluctuate (upward) but at least you have an idea of which markets you're interested in. This will help you make informed decisions, and you'll have a better idea if you really want to be in two places (or not).
During all this planning, think carefully about what other expenses you'll have — health care (a huge expense), groceries, taxes, travel (especially if you're moving back and forth from either side of the country), etc.
It's great that you are generally healthy and that you want to be there for your son and his future family. Being open with him about these thoughts may give you a better idea of how to properly plan for the future.
See also: “I hope to stay at home”: I am 76 years old and have no relatives. What should I do with my belongings?
