Pay Dirt is Slate’s money advice column. Have a question? Send it to Athena and Elizabeth here. (It’s anonymous!)
Dear Pay Dirt,
My sister has Alzheimer’s and no longer speaks. Her husband, my brother-in-law, is her full-time caretaker. My brother-in-law gave me authorization to both of their bank accounts in case something happened to him. He also suggested I get a power of attorney on my sister, which I did. He told me that if he should pass first, he wanted my sister to remain at home and for me to hire help for her. They are not wealthy (she has a small savings of about $10,000), but they do own an apartment next to their home.
He had been doing a fair job looking after my sister, but recently his attitude has changed. He refuses to have anyone come into his house. Each month since January, as soon as he receives his Social Security benefits and pension, he withdraws it. He pays only for his cigarettes and gas for his truck from his income. Any money left after paying for expenses, he withdraws it. He has also started withdrawing from her small savings account. If I question why the cash withdrawals, he gets upset. He recently told my other brother-in-law that he wants to be free and hinted that he wants to have my sister moved into a nursing home. He has been advised by his friends that if there is any money in their banks and other assets, he will have to pay for the nursing home monthly. I believe this is the reason for all those withdrawals. How can I protect my sister?
—Don’t Know How to Help
Dear Don’t Know,
Being any type of caregiver can be exhausting, especially one to a person with a degenerative condition such as Alzheimer’s. I’m not trying to excuse his abrupt behavior and what could have been snide comments about your sister to your mutual brother-in-law. But he may need more support than he had originally imagined, and she may be better off in a place like a nursing home where she can have round-the-clock care. He might be feeling like a failure and trying to work his feelings out.
Nursing homes are expensive, and while Medicaid will cover the costs long-term, eligibility is complex and may indeed require your brother-in-law to surrender the money in your sister’s bank account before qualifying. The rules also vary depending on your state, so your next best step would be to call or visit your state’s department of aging and see if someone can walk you through the different qualifications and restrictions. Next, I’d recommend a consultation with an attorney who specializes in elder law. He or she can inform you of your rights with regard to your power of attorney and explain what you can do about making sure your sister gets the care she needs. Make sure to keep records of all your interactions with your brother-in-law, and print bank statements in case he removes your user authorization. Good luck.
Dear Pay Dirt,
In January of this year, my husband and I had $15,000 in our emergency savings account, which felt great. It made me feel secure to have money to cover emergencies, and to see that amount felt like we were doing something right. We had debt—including $11,000 on our one credit card, a $5,000 auto loan, and student loans—but it felt like we were getting by, and the savings made me feel secure. We also met with a nonprofit financial adviser. She recommended making a large payment on our credit card to bring it down significantly. We made a $5,000 payment with our emergency fund.
Since then, we’ve had so many emergencies—my husband was laid off, car trouble, broken dishwasher, broken air conditioner (in July!), dental emergency. It goes on and on. We have not increased our debt to deal with these, but the emergency fund is now at $2,200—a distant memory of its former self. We have a third child on the way, which means financially it will now make more sense for my husband to stay home to watch the kids. Our credit card balance is now under $3,000, but I feel like I’ve had a rug pulled out from under me. I know I should prioritize getting that credit card to $0, but I’m not sure we can do that and build back the emergency fund. We made a plan to bring down our debt in January, but things are different now. How do you know when it’s time to change a plan, or should I just grit my teeth and hold on when I can see the end?
—What Emergency Savings?
Dear Emergency Savings,
How do you know when it’s time to change a plan? When it doesn’t feel right anymore. Listen to your gut. If stockpiling cash is what is going to make you feel secure, do it. You have a family to protect, and as the sole breadwinner, you’re going to make choices that don’t make sense to some but make sense to you. Also, this change of plans can be temporary—you can revisit your financial planner’s recommendations in a couple months, or a year, or whenever you feel ready.
So, no, don’t grit your teeth and hold on. Instead, take action. Make sure your emergency fund is in a high-yield savings account so your money is making you money. Use Mint (it’s free!) to track all of your spending to make sure you’re staying under budget. Take advantage of apps such as Ibotta and Fetch that give you cash back and gift cards for doing the shopping you were going to do anyway. Look into a balance transfer for your credit card to see if you can find a lower interest rate that will save you money and lower your payments. Or call your credit card company and see if they’ll give you a lower rate or adjust your balance. Have your hubby look into a side hustle he can do while the kids sleep. Do what you need to do so that when your baby comes, you’ll wonder where the extra diapers are, and not if you can afford them.
Dear Pay Dirt,
My sister and I are the only two siblings in our family. Despite having the same upbringing, she has never “gone out on her own” and made a life for herself. A bad and brief marriage gave
her a daughter, who is intelligent but also has no ambition. My sister and niece moved back to our parents’ home 25 years ago, proceeded to manipulate them into supporting them, and sat on their couch, watched their TV, used their money and credit cards for their expenses, and never worked another day. My sister tells me that she’s taking on huge responsibilities by “caring” for our parents, but other than taking them to a few appointments I’m not sure I’m seeing an equal exchange in this arrangement.
My parents have no assets other than their home, which they put into both my sister’s and my names. You know what’s coming: Sis made it clear to me that she intends to remain in the home, as it’s her “reward” for years of caring for my parents. While I don’t badly need the money from selling the house, I’m angry that I’m not going to get anything from my parents’ estate, especially after they’ve fully supported every one of her expenses for over two decades.
I can see how these types of situations can cause permanent rifts in a family, and I see myself becoming angry enough to not want to see my sister anymore after my mom and dad pass. I’ve worked hard my entire life and don’t want to get screwed out of a small inheritance because my sibling is a lazy, manipulative human. How do you even start a conversation with someone who sees this situation as their meal ticket for the rest of their life?
— Feeling Selfish
Dear Feeling Selfish,
First of all, anger is totally valid in this situation. It’s frustrating when you have a codependent family dynamic like this, and there seems to be no stopping it. Of course she thinks she’s staying in the house—your parents have not led her to believe anything different. You also share that you’re not hurting for cash, which makes me nervous for you to have this conversation with her. She will feel threatened and possibly persuade your parents to take your name off the house. Then what?
I think you should ask your parents for a copy of their estate planning documents, go through them, and speak with an estate lawyer if there’s anything confusing or alarming .The last thing you need when you’re grieving is a surprise such as finding they set up a living trust that allows your sibling to live there without forcing an immediate sale of the jointly inherited home. I also recommend reading the book Mom and Dad, We Need to Talk by Cameron Huddleston for tips on how to navigate having a conversation with them about their finances.
I think there’s a good chance they’ll say no to giving you the paperwork, but I’d still recommend making that appointment with an estate attorney. After consultation, your attorney can prepare you for a variety of scenarios that may happen so that when the time comes, you’ll know what to do next so that your sister can’t use her manipulative behavior on you.
Dear Pay Dirt,
I’m 25 years old and feel at a loss when it comes to saving and planning for the future. I make about $60,000 in a fairly stable profession, have about $50,000 in total savings, checking, and investments, and no debt. I’ve had to change jobs a couple of times out of college and don’t have a 401(k) or other retirement savings account, and am anxious that I’ve already missed the boat on saving early. I also would like to one day be able to buy a condo or house with my boyfriend. I just have no idea what the right path is. I’m not close with my parents and feel very hesitant about turning to them for advice. How do young people figure this stuff out by themselves? Reading articles about financial planning is starting to give me hives, but I know I need to get a handle of my financial future. I naïvely looked at listings for certified financial planners, but I definitely don’t have $500,000 to $1 million in assets for them to advise me on. I wish I had someone I trusted to just tell me what to do or where to even start!
—A Little Money, a Lot of Questions
Dear Lot of Questions,
You are doing extremely well for yourself at age 25, so pat yourself on the back. It’s great that you are in a profession that will seems like it will allow you to grow your already impressive portfolio and hit your financial goals, so let’s get started.
First, track your spending, if you aren’t doing so already. You can use a variety of tools now to get you there, like Mint, Personal Capital or even just a Google spreadsheet that you can access from anywhere. Make sure every penny is accounted for, and you are following a budget like a rockstar.
Next, retirement. If your company has a 401(K), start investing. Most companies have a match, and even if they don’t, 401(K) s are a great retirement investment vehicle that you can contribute to pre-tax. You can also open up a Roth IRA that’s subject to less regulation than a 401(K) because you are investing money that is post-taxed. Make sure you have the right insurance for everything in your life, such as rental, auto, and most importantly, yourself. This will save you money over the years that you can use towards a down payment on a house.
For more advice, and short-term planning, I recommend reading Broke Millennial by Erin Lowry. You’re not broke (congrats!), but her advice will still apply. Not only does she have several books out aimed at people in their 20-30s that are just getting started, she also blogs. I’m so excited for you and your new journey!
More Advice From Slate
Recently a friend of a friend’s brother, Morgan, died of cancer. I have met this friend-of-a-friend at a few parties and we talk on Facebook sometimes, but we have never been very close, and I have never interacted with the brother. Lately, in preparation for the soon-approaching death of grandma’s beloved dog and with a desire to not let her live in a bubble, I have been teaching my daughter Kaitlin, who is 6, about death and the grieving process. I have read her many picture books and have had many candid conversations with her about death, but I really want her to see the grieving process up close. Is it inappropriate of me to take Kaitlin to Morgan’s funeral as a learning experience?