All posts by Joy

Planning – Getting Ahead of Life Somehow

I’m looking at how to best manage the next 5 years of my life before I, gasp, turn 40 (holy crap, 40 – what on earth happened?) Anyway, I still have 4.5 years before that happens… which is so little time and yet these years will define the rest of my life in that I will either have achieved the final level of phase 1 financial stability, or not, and I will either have had one or more kids (to add to the one I already have) or not.

While planning this type of stuff is hard given so many moving parts and possibilities, I have to say thus far I’ve been pretty good at hitting my goals. I saved $500k before having my first kid, and, with infertility treatments was able to get pregnant by the time I turned 34 (taking my pregnancy test literally on my 34th birthday.) So with a track record like that, I’m going to keep planning and attempting to hit these goals.

Today, I thought out how the next 3-5 years could work… will keep posting here to see if life turns out this way, or not…

  • Keep current job until March 2022 and save $400k (net worth $1.3M)
  • Potentially free embryos ~Dec 2019 (3 mo after finish breastfeeding)
  • Lose 40lbs by May 2020 (~3.5lb / month)
  • Move into 3br apartment or house (rent/buy) May 2020
  • May/June 2020 (age 36) – pregnant with baby #2 (due Mar/Apr 2021, age 37)
  • Maternity leave 4 mo ~Feb/Mar/Apr/May Jun 2021
  • Sept/Oct 2022 pregnant with #3 (after 5-6 months at new job!!!) – give birth June/July 2023 (age 39)

How Did My Father Leave Such a Financial Mess?

It has been a while since I’ve written about my mother’s financial situation because seeing the full picture of the train wreck that it is has taken time since my father’s passing. I think we now can see it – and it’s not a pretty picture.

We lived in a fantasy wackadoo financial world, and I never realized this until seeing the hard numbers after my father passed away last year. Sadly, there was a time when there was a significant amount of family wealth–but since my father retired early and then went on disability around age 55 and then got cancer and was told he had 2 years to live and then lived for 8 more, the money disappeared. Well, it was spent, and it was mispent.

My mother isn’t entirely at fault for this. Did she spend the money? Yes. But my father was abusive to her and not only would not let her be involved with the household finances but also told her that the financial situation was fine and she would be set for life. He told me that he had $50,000 set aside for my wedding and another $50,000 for my sisters (I would have never spent $50k had I understood the actual financial situation, and I do feel guilty about this and also want to help as much as I can at least up to that amount over time, but I can’t even afford a house right now so it seems like now is not that time – but down the road, should my mother be out of money, by then hopefully I can help.) Anyway, it was either one big fat lie or my father was delusional (and who knows what the strong cancer drugs did to his mind in those years, let alone his standard aging process.)

I’ll never know what happened. I know from around 2005 to 2018, my parents lost a significant chunk of wealth and it didn’t have to be that way. I know that I will always feel guilty for not stepping in sooner to really push them on their financial situation. I don’t know if I could have helped as my father, until close to the end of his life, kept this information to himself–he even did his own taxes (which was part of the problem–as he DIDN’T end up doing them for a few years) — and everything is clearer in hindsight but I just am not sure if I could have done anything at the time to help avoid this nightmare. Regardless, it’s too late to go back and change things. All I can do is try my best to help the current situation.

The current situation is that:

  •  my father’s supposed “paid” taxes were actually three years of unfiled, unpaid taxes, with two of those years having major amounts owed and massive penalties on top of these amounts – to the tune of $60k+
  • my father was unable to handle dealing with his certain death, despite having 10 years of living with a terminal illness, so my mother had to, the day after he died, race around to find a burial site and pay top dollar for their plots and the service, etc. This cost $30k. I couldn’t bring myself to push for cremation, even though I know it would have been cheaper. The $30k was also due to my mother picking a nicer cemetery (since she’d be buried there too!) and not having time to shop around. Then there was the reception after the funeral… it wasn’t at the fanciest place but everything adds up when you have a lot of people and last minute expenses.
  • So it turns out there was no money out of the IRA (just $400k in there, more on that in a bit) to pay that $30k, then put on my mother’s credit card. My uncle (father’s brother) kindly let her borrow the money to pay it, but she owes him it back by 2020, which is right around the corner. All this happened before realizing there was such a massive tax bill due!
  • my father (and mother) took out a home equity loan to the tune of $200k on a home valued $500k (which was paid off!!!) in order to add on to their house, renovate bathrooms, who knows what else. My mother has no idea what everything cost and sadly there are no records that we can find (which is shitty, because it makes her have to rush to sell the house, see next bullet – though maybe this is a good thing.) Anyway, there’s a $200k home equity line of credit that is tapped with variable interest that’s about $650 a month right now interest only that will be $1600-$1800+ starting May next year when she has to pay principle and interest…
  • I didn’t realize this, but after your spouse dies, you have 2 years to sell your house to get the $500k capital gains exclusion… after that time it goes back to $250k. If my mother and father kept good records of all the work they had done to the house over the years, this wouldn’t be an issue–but, shockingly, these records are no where to be found. My father supposedly, messy as he was, kept all his papers – so I’m hoping they will turn up somewhere, but so far, no luck in finding them…
  • the house is a money sink. This is the hardest for me because I grew up in that house and I’m so emotionally attached to it. I know a house is a house is a house and the memories made in it will never go away once it’s sold, and people sell their childhood homes everyday and it’s not like we could own the house forever—but that doesn’t change how hard selling the house will be for me. I don’t have a great memory… but when I’m back in those walls, my childhood comes flooding back, the good and the bad of it, and I feel like time isn’t slipping away quite so fast. I also dreamed of having my children visit my parents there–it’s a great “grandmas house” — to spend lazy summer days playing in the backyard on vacation as my mother watches my kid(s) run around… it’s just readjusting the plans I had and mourning the loss of my father, my childhood, my past. It has to happen sometime–why not now? But I don’t feel ready for it. I’m so not ready for it I’m wondering if there is a non idiotic way I can purchase the home and rent it back to my mother–just so she has access to the cash and we still keep the home in the family for another few years. I know I can’t even afford my own home living in The Bay Area BUT this would motivate me even more to keep my job and earn more money. The house is worth $500k-ish, and that’s actually affordable. If I can’t buy property here, then is it horrible to own property elsewhere?… but it’s in a high tax state and the taxes on that house are killer, and so is managing the property… it’s not a HUGE house but it’s certainly not small, and the land is expensive to take care of. It doesn’t make sense, but that doesn’t stop me from daydreaming about buying the house and helping my mom stay there for another few years and still get the $500k in capital gains exclusion in time…
  • In the years of financial recklessness, my parents purchased a “snowbird” condo in Florida. My father told my mother this was always going to be a vacation home, so they purchased a 2br/2ba condo for $60k and fixed it up for another $40k (or so I’m told) paying cash on this (which kills me because it was yet another expense that led to having to pay a bazillion dollars in taxes since all the money was held in the IRA and my dad then somehow failed to pay the right amount those years) — he could have taken a mortgage to buy the property and not paid for it all up front. He could have taken me up on my offer to pay for my wedding or at the least to pay for some of it since I had access to money and he could pay me back over time, if he really wanted to pay for the whole thing. But he was too prideful, or his brain was broken, or both. I wish I could ask him what the hell he was thinking. But they bought they condo. That $100k in cash, with tax penalties for taking the money out of the IRA and not filing/paying on time, probably ended up costing them $200k. I am not sure how to figure out how much money was lost by simply failing to manage the money left wisely due to it being in “tax advantaged” accounts, and I’m not sure it matters now–but I know there was a substantial amount lost because of extremely poor management.
  • The good news is that my mother set up the condo in Florida to meet her liking, and she seems happy there. It’s unclear if she will be happy living there full time since most people in the community go home for the summer and I worry she will be lonely. At least she is the type to be happy anywhere there is a pool and people willing to listen to her stories. But in the summers there it will be extremely hot and the pool area will be rather empty. Her sister also now lives in Florida but a 2 hour drive from her condo. I worry about her being alone, or more alone then I ever imagined she’d be. There’s nothing wrong with retiring to Florida (certainly tax wise it’s a good idea) but how can I manage to help her as she ages without other family close by to check on her, etc? And no money there to help put the proper support system in place?
  • My father was talked int putting an annuity with a death benefit in his IRA by a Bank of America rep. I talked to the rep after my father’s death and he shared why he thought it was a good idea (I’m unsure, but too late for it to matter.) My mother did get a ‘death benefit’ payout in the IRA, which is now sitting in cash, which is a problem, because of the $400k in the IRA, only $100k is in investments and the rest is sitting in cash – and I’m sure to afford her life the rest needs to at least be in bonds or something that is making money but it’s not. We want to hire a CFP but after working with my CFP (more on that in another post) I’m not sure what CFP is the right option as they’re quite expensive and CFPs typically don’t manage tax issues, or other weird issues like the ones my mother is facing. They can certainly run an analysis of when she’ll run out of money and when she has to sell the house, but we still don’t have the final tax bill so it’s hard to even run those numbers yet.
  • Taxes. Do we hire a lawyer or enrolled agent to help with attempting a penalty abatement and lower-cost-per-month payment plan? Another substantial expense and I’m not sure it’s worth it – I mean, it’s worth it if we can get the penalties abated and a good payment plan, but it seems like either we can do this ourselves or the IRS won’t allow this. My father apparently had a number of years where he already had a bad history of payment on time, so the IRS may just disallow our abatement request. However, I’m hoping with proper documentation on my father’s illness and also my mother’s documented abuse record, there’s a chance they’ll take off some or all of the penalties. Do we really need to spend $5000 on a lawyer to do this? I feel like I can probably help here and save that $5000, but if it doesn’t work my mother may blame me (even if it wouldn’t have worked with a lawyer) and if it does, but partially, then how will we know if we got the “best” deal? But all his money – $5000 for a tax lawyer, $5000 for a CFP, etc etc, needs to come from somewhere and that requires taking more out of the IRA. I’m trying at this point to help her avoid taking too much out of the IRA.
  • The good news – if there is any good news – is that my father did have a sizable pension and made sure to take the one that would provide lifetime income for my mother. That, with social security, amounts to something like a $50k-$70k salary before tax. A single person SHOULD be able to live on that income just fine…
  • But my mother is horrible at budgeting. That is to say she refuses to budget. I have her set up with a Mint account and I’m watching and documenting how much she spends on everything each month. She has definitely reduced her spending A BIT but I can’t get her to stop buying clothes “on sale” and spending on unnecessary items. Right now she is spending about $40,000 more than she earns per year, give or take as I’m not sure what her total tax liability is for this year. With $400k in the IRA, she is going to be in credit card debt in a few years at this rate. It will slow a bit once she gets the full SS amount (see blow), but not enough. Really the only way to stop the bleeding is to sell the primary house…
  • This is ESPECIALLY important this year because we have decided (and I’m not sure if it’s the right decision) to wait until she turns 66 to take the full survivors benefit for social security. If the math we ran was right, it will take about 17 years till break even on this choice – so it might not make any sense at all. I think it’s a pile of shit how social security works in that you’re supposed to get the same amount whether you live a long time or not long as all as long as you properly estimate when you’re going to die–because that’s an easy thing to guess.
  • My father made other bad money moves that have left residual issues. A few years ago my sister got into a car accident that wasn’t her fault. She earns minimum wage and although my parents paid for her car in full she didn’t have the type of insurance on it that would pay out in the case of a hit and run. Well, she was in a hit and run and her car was totaled. She was willing to pay a certain amount for a new car (about $10,000) but my father decided that $10,000 was not enough to get a car that was “safe” he would pay $5000 on top of that for her to get a certified pre-owned Toyota Corolla. That certainly was nice of him to do, and would make sense if he had the money to spend in the first place.  He did decide not to pay for this in cash entirely and instead to take out a low interest loan offered by the dealership, you know, while he had a terminal illness… without thinking what happens to the non-transferable warranty or Gap insurance he paid for in the purchase price when he died. So now another issue is figuring out what to do with my sister’s car… about $6000 is left owed on it, and my sister has been dutifully making monthly payments on the % she owes, but apparently once the person on the loan dies it’s necessary to pay off the loan with the estate (so I’ve read) or take a new loan out to pay off that loan. My sister assumes my mother will pay off the loan and she can pay her back, which is fine except that will require taking $ out of the IRA to do and that will cost more than $6000. So I suggested my sister look into how much a new loan would cost (I assume the interest on a loan — if she could get one — would be quite high.) I told her find out what this would be and then let’s talk. I could possibly loan her the $ at a much lower interest rate. Maybe I should just give her the money at 0% interest rate (and I might) but I’m trying to strategically figure out where I should be offering money to help with the whole mess across the board, while also trying to save for a down payment and afford my life. I don’t mind loaning her the money and maybe even for 0% interest but I want her to take the steps of figuring out how much it should cost her to get a loan and at least be an adult about this.
  • My sister finally moved out of the house and in with her boyfriend and she got a job that pays shitty but at least has benefits. So my sister is no longer living rent free (with high utility bills) in my mother’s house, so that will bring down costs a bit, but I’m worried about my sister’s financial well being in the long run. She has no retirement savings and isn’t listening to me when I’ve told her to put aside more money for emergencies and such. I ran her budgets and I know it’s tight and she thinks I don’t understand living in relative poverty but she can be making better decisions overall and I’m hoping eventually she listens to me so I can help her start on the path to financial security. I’ve always said I would never let her end up on the street and I definitely wouldn’t, but I want her to at least take responsibility to try to manage her money better. She doesn’t have any debts outside of the car situation, so that’s good, but she also doesn’t have enough money in an emergency fund and it’s different now that my mother can no longer afford to help her out if needed. I can, as long as I don’t own a house and I keep my job, but I really want her to try as hard as possible for it not to come to that. It’s not like she spends a fortune on things, but when you make that little you have to be even more cautious with your budget.
  • There is so much crap in the house that selling it will be a nightmare. My father has always been a “collector” of (likely) worthless stuff — paintings and sculptures from art shows, baseball figurines, records and CDs and DVDs, books, and who knows what else. Maybe some of it is worth something but selling it all and determining if any of it is worth more than pennies on the dollar is going to take more time than it’s worth. Once he was diagnosed with terminal cancer his collecting definitely increased. I get it – he was dying and collecting was a hobby and maybe helped him feel like he wasn’t in such a horrible position. Still, I wish there was some fiscal logic in the behavior those last years the my parents should have been downsizing anyway, not buying more stuff.
  • My father almost built an additional storage unit in the back of our house (the house already has 3 attics!) as my mother is a hoarder and has run out of room for stuff. Did I mention I’m not looking forward to cleaning out the house to prepare it for sale?
  • My parents spent a lot on making the house accessible and livable for my father. This wasn’t necessarily a bad thing, but the amount of years of use vs the probably better thing to do of selling the house years ago and moving to an accessible building just is sad when you look at it from a sheer numbers perspective. Even if they did want to stay, they could have more wisely spent those dollars, and less of them, to make it livable but not to the point of spending way more than the house will ever be worth.
  • Meanwhile, parts of the house are falling apart. The oven has been broken for years. Who knows when a new roof is needed (not my mother, that’s for sure.)  There will be costly updates before selling the house likely that weren’t handled with all the money spent on additions and renovations.
  • He paid for years into long term care but ended up not using it at the end because to use it he would have to admit he was dying soon and he never could. He also wanted to be home and the LTC policy did not cover the full amount of in home care, so I think he knew he didn’t have the money to use it- but unfortunately was unable to have an honest conversation about this – so his last months were spent first in the hospital, then in rehab, and then for a horrible few weeks at home where my mother could not properly care for him, and then his condition worsening (who knows if it would have been better if he never went home or had actual in-home care), and then back in the hospital and then back in a different rehab where he died. That whole process is a long blog post or a book of trauma which haunts me and makes me feel sick every time I think about it. But from a financial perspective, it was just extremely sad that he didn’t use his long term care policy when he needed it most. Meanwhile he stopped paying for my mother’s LTC policy years ago because he said it was “too expensive.” Well, now it’s too late to get her one (probably) and she probably will be the one who needs it. I’m terrified of what happens as my mother ages. She may be a looney toon but she’s still my mother and I want to make sure she’s as ok as one can be in her senior years.
  • My father constantly mentioned wanting to pass money down to his children (myself and my sister) and while at this point I do not expect that, it’s still sad that he made this comment time and again (esp for my sister since he saw her as incapable of taking care of herself) and now there’s basically nothing left. I don’t know how to advise my mother on this as I don’t want to have anything to do with whether or not she cares to pass money down to her children (and I certainly don’t feel like I have the right to anything) but I am worried about my sister and I also just think it’s sad that this was so important to my father but he failed to set things to up to make sure it happened. As a parent now, and one who hopefully accumulate substantial wealth, I want to make sure my child(ren) are set up to be ok even if the world goes to shit.

Well, I’m sure I’m forgetting and/or not seeing other financial issues that will come up. Thus far we’ve successfully filed 2015-2017 taxes (and have an extension on 2018) so that’s step 1. Baby steps. I see the light at the end of the tunnel here, once the taxes and loans are paid off, and the main house is sold. I think her Florida condo, as a full time dwelling, should help her get to at least break even for a few years, and hopefully she can even save some of the pension and social security money at some point to increase her investments and stretch out what’s left of the IRA.

New Goal: $1.3M Networth by 2022 (age 38)

In 2008 or so, I had $29k in total net worth. Ten years later, my net worth closed out the year at $625k. Ten years ago I couldn’t fathom having more than $100k in a bank account. At age 24, I was just getting started in my career, making very little, and wondering how on earth to save money.

I started out ahead of many–a college degree with no loans. I’m not sure I’d be where I am today or even close to it if I had massive loans to pay back, because that would have not only cut into my savings, but also likely prevented me from taking some of the risks I’ve taken over the last 10 years that helped me save so aggressively. But, I do try to take a few moments to be grateful for what I have, and how much I’ve been able to save–despite not being able to afford the high cost of living in the Bay Area.

Today, I’m especially grateful that my current path has not only enabled me to hit my goal of saving $500,000 before giving birth to my first child, but also is looking to possibly support my second goal of saving $1M before my second–which was a long shot just years ago.

Screen Shot 2019-05-11 at 9.26.43 AM

The last few months have been especially fruitful, thanks to vesting stock–my first stock vesting period working for a public company–and selling it off immediately. I do not include any unvested stock in my networth calculations since if I lose my job that $ isn’t real. But it’s hard not to fantasize about it being real–even with it being not that much once taxes are taken out–it’s still a substantial amount and can be life-altering given my whole financial strategy is save as much as possible as fast as possible… not for FIRE, but for financial freedom (working PT, consulting, or pursing more risky opportunities, or those that don’t pay as well, in order to help others and/or just spend more time with my family.) And I won’t give up a decent lifestyle today to assume that I’ll have enough money for a frugal one “tomorrow” that doesn’t require working. I want to LIVE today but support a future where I’m not worried about money and can afford a decent lifestyle with a family.

I’m still uncertain what my “number” is. At last estimate it was about $4M-$6M, including a house worth about $1.8M. I still don’t think I’ll EVER get there, but as I set new financial goals for myself along the way, it helps to keep focused on these mini wins towards this major goal. Even if $4M is my “goal” that’s far off.

I had said I wanted to hit $1M by 40. Right now, I’ve sped up that goal to 38 (I’m 35 and a half now.) Within the next 3 years, I’d like to get to that $1M mark. A lot will depend on the volatile markets — if we have a crash, there is no way I’ll get there. If they stay stable or keep growing, there’s a good chance…

  • April net worth: $847k
  • Remaining 2019 stock value after tax: ~$92k
  • 2020 stock value after tax: ~$123k

With saving my stock amounts, and with the markets staying stable, it’s quite possible I’ll get to $1M even earlier… by 37… which actually is my goal since I want my second kid by 37 and I would like to get to $1M before I give birth. I won’t feel any richer for it, but I think with $1M in the bank I’ll start feeling ok about taking a few more risks when it comes to buying a house. Ideally I’d have $1M in the bank (investments) plus enough for downpayment and closing fees in cash. Perhaps I can get there in 3 years. That requires saving $500k in 3 years, or $150k per year.

  • 2019 (35): $92k (stock) + $25k (interest) + $35k (income savings) = $152k
  • 2020 (36): $123k (stock) + $25k (interest) + $35k (income savings) – $50k (IVF) = $123k
  • 2021 (37): $123k (stock) + $25k (interest) + $35k (income savings) – $20k (preschool) = $153k

Total end of 2021: $1.275M. Not quite $1.3M, but close. Close enough where at that point I’d be willing to put $300k down on a $1.5M house and have $1M in the bank as a safety net.

Past 2021, my savings will go down again… my stock will be vested and it’s unlikely I will find another job where I make anywhere near this much. If I can keep this job until the end of 2021, I just realized… I’ll be really close to my goal–my new goal– $1.3M by the end of 2021.

BUT – big but here – is that to do that, we need to stay living in our 800 square foot one bedroom apartment rental for the next 3 years/until I have my second child. Maybe that’s crazy–but it won’t be that bad. If it means in 3 years we can buy a house and feel financially stable (ish) then it’s worth it, right?

Against a Wall: HCOL and Those Golden Handcuffs

Driving to work in traffic the other day, I kept thinking–how am I going to do this for another 30 years? Even with splitting the cost of a $2M home with my MIL, we still end up with a very high mortgage that means I’m at best stuck working high-stress jobs that pay well and at worst burning through my savings faster than my baby lunges for my chest when he’s hungry.

There are parts of my current job that I like. My boss is actually really awesome. I know I’m always a heartbeat away from falling out of favor with her, but she’s a good person and I like to work for people who are not self-absorbed sociopaths. She’s just really good at her job and also really good at all the things I’m not — being poised, being a leader/executive, managing lots of things at once, staying cool under pressure, et al. Luckily, she also respects my skillsets–despite surely wishing I was better at being a “professional” my value add is, well, valued. It feels good to be valued. I wish I could be a perfect employee, but I’m far from it, and after this chapter is over it may be my yet-again downfall… but at the least I’ll walk from this one knowing I’ve done some good.

Yet at the end of the day, I know this isn’t sustainable. I’m in survival mode… and we all are, because that’s how business is run these days. Maybe in government jobs things go slow… but we don’t have time to stop and think and be super strategic we just have to go go go. For all my shortcomings, I can take some pride in my ability to be flexible in these types of environments. I know not everyone can perform when every day is another day of fighting fires and not enough time to get things done. But somehow I do get things done. It’s usually the last minute–which I want to be better at–but they get done.

I can do this for a few more years at best, but with one kid and hopefully with another one or two in my future, this can’t be my life–at least, not forever. And the hardest reality to face is that even WITH this being my life, I still cannot safely afford a house here… not even a townhouse or a condo within 45 minutes of work (or at least I think I can’t afford one… it’s so hard to gauge what’s affordable because it all depends on making a crazy amount of money via bonus and stock. Sure, my next few years, if I can keep this job, will be quite lucrative – but that doesn’t mean 30 years of such high pay.)

My husband is pretty adamant about not moving into a condo or townhouse… he wants a house. He wants to pay $2000 a month for the mortgage from his income, wants his dad to pay $2000 a month, wants his mom to put down $1M in cash (possible) and wants me to make up the rest… which will be anywhere from $3000-$6000 a month for a house that we all live in together. But, houses cost more than the mortgage and taxes. There’s fixing up and fixing in general. Running the numbers, the picture looks so unpretty.

I’m sitting in my 1 bedroom apartment thinking– how long can we last here? It’s certainly the safest way to live right now. In our $2500/mo 1 bedroom, I’m saving a lot of money. Worst case, we rent forever. Best case, the money I’m saving and investing in the stock market goes up to the point I have enough for a sizable downpayment on our own place without needing his parents to buy with us. But then there’s the whole matter of him WANTING to live with his parents. Ugh. Is this why marriage is so tough? I’ve spent my whole life trying to obtain independence and I know it’s nice to have grandparents nearby but I’m not so sure I want them literally in our backyard…

My realtor has pretty much disowned me at this point. I feel bad because she spent so much time with us taking us around and showing us houses but at the end of the day I can’t buy a $1.7M home that needs a lot of work. I can’t buy a $1.2M condo that’s a 2 bedroom and needs little work because it’s a 2 bedroom and why would I buy a 2 bedroom condo when we want more kids and will want more room?

But we’re stuck. We can’t leave… well, I can’t leave because my husband refuses to leave and I don’t really want to and we have, at least for now, free childcare here so why would we leave? And our friends and his family are here. And there’s no where else we want to go. And my job and my 10,000 recruiter emails are here (there have definitely been an uptick in recruiter emails lately- mostly from San Francisco-based companies.) So. Even if I won’t always make $250k+ a year, I still will likely be able to get jobs here making $150k+. But that’s NOT ENOUGH to live here when your. husband makes $90k 1099 and especially when you’re prone to losing your job for a few months every few years.

It’s just super depressing and I feel like a spoiled brat every time I talk about how depressing it is… I’m so lucky… I need to learn to be grateful and get over it, right? But it is suffocating–the way we work. The way we’re expected to work all the time and because I can’t do that effectively right now even if I wanted to because I have a young child then I feel like I’m letting everyone down because I can’t get through all my work at the office (and I’m half asleep all the time to add to that.) I could try harder. Be more organized. More focused. Drink more coffee. Wake up earlier. I don’t know. Again, I’m in pure survival mode… but that’s not living. That’s hoping and holding your breath that you’ll make it three more months to vest another stock grant. Another chance at maybe being able to have a future here.

But what is that number anyway? The “number” — net worth number– is probably far to large to ever be possible. My husband and I have a joint net worth now of $925k (about $800k of that is my savings.) That’s SO MUCH MORE than I ever thought was possible to save. We’re close to hitting $1M! That’s insane. So why do I feel so broke? Maybe I should take more risks. Buy a house and figure prices will go up… that inflation will make $9000 a month in mortgage seem sane in a few years down the road? With my mental health situation and now with a kid, I just can’t take those kind of risks. Not with $1M in the bank. Maybe with $2M in the bank… or $3M. I’m not sure how many million but definitely more than $1M. Ideally enough to buy a $2M house outright with $1M in retirement savings, so $3M seems about right.

So if I (we) add $50,000 a year cash to our investments, assuming $800k is invested now, in 16 years at 5% YoY interest we’ll have $3M. Of course by then houses will cost a lot more than $2M. That doesn’t work. If we add $100,000 a year, then we have just 12 years to wait… but then in 12 years if a $2M house increases in value 4% YoY the house will cost $3.2M… nope, that doesn’t work either.

I know everyone says just take your money and move somewhere cheaper… but let’s assume that’s not an option. Then what do we do? The house we wanted for $1.7M (that would require about $400k-$500k work) is still available – hey at least I called it as being over priced. But, it will be gone soon enough. The market will get competitive again. Now is a “good time to buy.” Another house we looked at was shown one weekend and gone by the next. Most decent properties still go that fast around here. And I still don’t want to live with my husband’s parents so… my only option is figuring out how to save $300k for a downpayment AND how I can afford $5,500 a month while my husband pays $2000 a month ($7500 total.) That’s what a $1.5M house costs, give or take. $300k down and $7500 a month (at 4% interest, so it’s prob more than that depending on when you buy.)

could sell $300k (+ capital gains tax) worth of stock AND just commit to paying $5500  per month on my own for the next 30 years (and hope my husband can keep doing $2000 a month.) I need to keep saving because if I need to take unpaid leave or god forbid lose my job for a few months (which will happen, let’s be real we’re talking about me here) then… well, I need enough cash to cover $5500 a month for about a year, so $66,000 cash, not counting general emergency fund. And where does the money come from to send our kids to preschool? Or after school activities? Or summer camp?

The numbers just don’t add up.

Ok, so let’s say… probably more realistically… we buy a $1.3M condo (priced at $1.2M, but it goes for $1.3M because that’s how real estate rolls in these parts.) HOA is something like $333/mo. Some are higher, some lower, but that’s about average. It could go up. There could be a special assessment. But nonetheless… with $333 / mo HOA and a $1.3M condo/townhome… that’s $260k down and $7000 a month… so I’m still paying $5000 a month, just $500/mo less and $40k savings on the downpayment. Substantial, but then the value of the home won’t go up as much because it’s a condo.

Or, we say… you know what, we’re going to move to the east bay because houses are cheaper there. We can get a house in a decent but not great area for $900k. Phew.  Our downpayment is JUST $160,000. Yes! Doable. Our monthly payment is $5000, leaving me with JUST $3000/month to pay. This looks a lot better. But then I’m paying $6 a day for bridge toll ($120 / mo) and commuting an hour or more to work each way – maybe more, if I work in the city again one day. Still, not so bad. But, wait, then we have to add in childcare because my husband’s parents do not drive and can’t get to us. So that’s $2,000 a month, if not more. So then we’re back up to $7000 a month anyway… and that’s with just one kid (I know, this is just for a few years… but still, it’s the years the $ costs the most before inflation kicks in and makes the mortgage somewhat ok.)

How the fuck do people do this?

Maybe we should just suck it up and buy a $900k home in the east bay and pay for childcare and drive to see his parents on the weekends. That’s probably what normal people would do. Or they’d move to Denver. Or Austin. Or Boise. Or Portland. Or Raleigh. Or anywhere else things make mathematical sense to live.

Welp. That’s my rant for the day.

 

We ALMOST Bought a $1.8M House…

And I am, at this moment, regretting not doing it.

$1.8M.

$1-8-0-0-0-0-0-0.

That’s a heck of a lot of cash.

We’re not rich people. We’re not the type of people that should be spending $1M a home, let alone $1.8M.

But — that is what it looks like we HAVE to do if I don’t want a crazy horrible commute and we don’t want to leave the area.

What makes the $1.8M possible is that we’re still strongly leaning towards buying with (AND LIVING WITH) my in laws. The big requirement is that they have a separate living area from us (separate unit on the property or at the least an in law with separate entrance.)

The $1.8M house was super cute. 3 bedroom, 2 bath, with a 400 square foot garage we could convert…

It had its issues. Other than being $1.8M. It had some termite activity, according to the disclosures. The 400 square feet of the garage would be challenging to turn into a real 1 bedroom apartment (my in laws aren’t married but are friends, so they can live in the same unit just need their own rooms.) The lot didn’t seem that big, though I guess it was at 7,500 sq ft, but most of that was in the front yard and in a very long driveway.

I regret not buying it, but I would have regretted buying it.

It was originally a 2br/1ba, and along its life some time an addition was plopped on the back of another bedroom and bath – the master suite. But the suite wasn’t that sizable… a full sized bed felt tight in there. While the home showed quite nicely, the reality was that for $1.8M it was too small for us, given we want to grow our family soon.

But I don’t think anything here will really be the right fit… unless we want to spend $3M+, which we don’t, and we won’t, unless we win the lottery we don’t play.

That said, my husband and I started tracking our joint net worth and it’s about $920k right now. Not too shabby. Mine is about $840k of that! But that’s ok. We’re doing well, yet living in a 1 bedroom apartment. I realized that this year, with my stock and bonus and such, I could clear $300k-$350k before tax ($117k of that I’ve already made as of April 1, which is crazy to think.) If I could maintain this level of income for the next 30 years, sure, we can afford a $1.8M home. But I won’t. I won the job lottery at the moment and am holding on for dear life. In 3 years, I can save a good $300k and we should break $1M in net worth. After we hit $1M, I’ll feel comfortable having another child… but I’m not sure I feel comfortable purchasing a home for $1.5M+. $500k, sure. $800k, maybe. $1M, possibly. $1.8M…

That’s too much for a house. That’s just insane.

My husband makes $80k a year. We aren’t paying for childcare right now, but if his parents got sick that could change any minute and we’d have $2k/ mo right there. With another kid, that’s $4k a month. It just doesn’t add up. Even if his mother puts down $1M and we have a $800,000 mortgage, that’s about $7000 / mo. How does anyone do this?

The Things that Matter: American Workaholism and Being a Mom

It’s 5am and I am exhausted but can’t get back to sleep after my son woke up screaming for milk a few hours ago. He didn’t actually drink that much. My breasts are still engorged and I’m too tired/lazy to pump. I’m supposed to “wake up” for work in an hour, to make myself presentable for an 8am meeting. I’m not doing the best job of being presentable given I’m so exhausted and no amount of coffee will help.

But my exhaustion isn’t just due to being woken up in the middle of the night. It’s the hopeless exhaustion of now being in the midst of the roller coaster of life, with time both going too fast and too slow, and memories of long gone childhood reminding me that life wasn’t always like this–always so formulaic in its requirements for supporting basic sustainability of existence.

My fear to pay more in rent a month isn’t helping. My fear of running out of money, or, more so, of getting to the point where I have a nervous breakdown and do not go into work one day because I can no longer stand the majority of my waking hours being dedicated to trying to get people to buy a product that–very successfully–helps companies reduce their workforce (though that’s not its primary purpose, but like most tech for business these days, it’s one of its benefits.) Oh, it’s a great product and it’s exciting to be part of a company that’s growing and a team that is not in it to change the world despite also building products that reduce headcount (the idealism of startups was nice for a while, but it also feels good to be part of a team that doesn’t entirely live and breathe work 24/7.) But, at the end of the day, always the very long yet never long enough day, I sit in traffic on the freeway for 45 minutes with all the other commuters headed home and talk to my 6 month old son on the phone who is crying and anxious for mom (well, for mom’s chest anyway) and who doesn’t care that I’m sitting in traffic or that I have to go to work to make enough money to try to save so maybe one day we can buy a house and go on vacations and such.

The reality is that my situation is so much better than 99% of the world, maybe even 99.9% of the world, and I’m still, well, not happy. I don’t know if I have the capacity for sustained happiness, given it’s me we’re talking about, but I’d like to not constantly live in fear. I acknowledge that buying a house with monthly mortgage payments will heighten my anxiety immensely. If we can make it work to buy a property with my MIL and FIL, and keep our monthly payments closer to what we’re paying now (or at least what we’d pay in rent for a decent 3br/2ba apartment), then maybe that’s ok. But then there’s all the other issues that come up with home ownership. It’s terrifying.

But then I’m also sitting here, 35 going on 40, realizing that there is no “when” at this point in life. I’m past the stage of saving and waiting. It’s now or never. I have a kid. I have a job that is as stable as my work will probably ever be. I have a husband who may return to school to make even less than he does now, but at least he’ll get benefits in case I should lose said job. Why not just take the leap? Have some stability for once? I’d like to give that to my kid. He won’t remember his first year of life, but I’d prefer not to jump around from rental to rental throughout his life. I know it’s not the end of the world, but I grew up in one home from 0-17 and although moving once or twice in that timeframe is ok, moving every year or every other year is best to be avoided. I want to meet my neighbors, I want to feel like we’ve “made it” by having our own backyard, however small it is. Our own kitchen and bathroom and walls and tiny storage area so my bike doesn’t have to live in our living room.

I’m tired. I’m tired and unhealthy and I know my body is upset for it. I feel myself aging too fast. I’m not finding time to work out and my diet has gone to complete shit. There’s so much I want to improve, but for now, I’m barely getting by.

Home (Bitter) Sweet, $2M Bay Area Home

I haven’t written in a while, because as a new mom working full time, there isn’t time in the day to do much other than work, feed (a baby), eat and sleep. And even that last one rarely happens these days.

A lot is going on with our finances these days, so I have plenty to write about, but I’ll focus here on our recent quest to purchase a house in the Bay Area. In short, it’s not going well. I just can’t accept that we have to spend $8k a month on a mortgage for the next 30 years in order to afford anything remotely decent in the likes of a 3br/2ba house. And the market isn’t even at its hottest these days.

The big question right now is whether or not we go in with my husband’s parents to purchase a home. In theory, this is a good idea, since his mother has $1M for a downpayment and his father can contribute $2k a month to the mortgage and bills. That would help a lot if we get a loan for, say, $750k on a $1.7M home. And, you’d think you could find a house with enough room for $1,7000,000. But – we’re in crazy land here real estate wise, and while $1.7M gets you more than a closet, it’s not that much more (and the closets, well, they aren’t big enough to fit much of anything.)

Anyone learning of our situation wold say — why don’t you live further from your work, or, heck, move to another state? Yes, all possible, but not what we want. I already feel like I live too far from work with a 45 minute commute one way and I barely see my kid. If we HAVE to, yes, I can do a 1.5 hr commute one way / 3 hrs RT but — then I get into the philosophical question of WHY. I don’t like my career to begin with, the reason I am working in it is because it pays well (at the moment, really well.) But that won’t last forever. And if there’s anything that gives me a panic attack, it’s committing to staying in this career (and somehow remaining gainfully employed in it) for the next 30 years.

I’m really not sure what to do here. My general thought is this:

  • Try my best to keep my current job for 34 more months, which is netting about $300k/yr pre tax for next 3 years
  • Stay in our $2500/month 1 bedroom apartment until my son is 1
  • Move into a rental 3br/2ba house closer to work that my father in law can also live in (requires a lot of looking for the right place, since he would need a private entrance to his room and ideally his own bath) — about $6000/mo ($4000 / mo for us, $2000 for his father)
  • Live there for the foreseeable future and save as much as possible
  • Either get promoted at work into a role that pays even more and that I can see myself in for next 30 years (unlikely) OR just keep saving until we have enough for a sizable downpayment to keep monthly payments low OR move far far away and never look back

The only reason why it makes some sense to buy a house now is that my mother in law has that $1M in cash earning basically no interest at the moment, so putting that into a house would at least allow that money to keep up with inflation, probably. It would even make sense for her to loan us the money and for us to pay her interest on it. Either she spends it then on something she needs in her life, or one day it comes back to us as my husband is an other child. Either way, it feels better than taking the full $1M and putting her in a tiny in law unit on the property without its own kitchen. She might not care, but it just feels wrong.

We did meet with a real estate agent and I’m running out numbers with a broker to get pre approval. I’m shocked that without my MIL’s $ for a downpayment, it still looks like we can qualify for a $1.8M variable loan, give or take. That’s insane to me. I know you don’t have to take as much as the bank offers you, but that’s basically a $9k a month payment. Since they aren’t counting my bonus or stock – that’s somehow assuming we can pay $9k a month on about $10k after tax. It makes no sense. And we wonder why we have housing bubbles that go bust.

I’m trying to avoid the emotional side of me that wants to BUY A HOUSE NOW. It’s being amplified by knowing that my mom has to sell my childhood home, and even though I’ve lived in apartments now for many years I always had a place to go back to that was my home. With that house being sold, I don’t have a home any more, and that makes me feel icky. Not icky enough to make a stupid financial decision, but icky nonetheless.

I hired a CFP to help us figure this all out but I am pretty sure I made the wrong decision in who I hired as we’re way too confusing for him – he’d be good with a straightforward couple who both earn tech salaries and will likely earn those salaries for their entire careers. That’s not us. So I’m pissed at myself for picking this guy. He’s not bad, but he’s not flexible and he doesn’t think outside the box. We need some flexibility here. And he’s supportive of buying the home now, but I’m not so sure he should be.

In any case, we’re working on pre approval then will decide what to do. I’m kind of hoping we find a 3br/2ba home for $1.2M that we can buy and live in with my father in law, with his $2k / month going toward mortgage/taxes, and then his mother can find her own similar property when she has to move in the next few years (when her mother passes away, the property will be sold and income split amongst the 3 siblings.) At that point, she should have about $1.5M in cash or more and she can go out and buy a small house with a nice backyard and we can have our $1.2M tiny house that we work to fix up and make our own. That’s really the best plan, I think, though finding anything half-way decent for $1.2M is pretty impossible here. We could get a 2br/2ba condo, but that doesn’t make sense since we want to have more kids and that wouldn’t allow us to grow our family or have guests over. So I’m hoping we go for a $1.2M house close to my work, we can make that work with his father so that covers taxes, at least for a few years, and we do our best to make this home our own. I really think that’s the best way to go about things, if we don’t just stick to renting.

Update on the Whole My Mom’s Finances are Fucked Situation

Sorry for the foul language, but hey, when things are fucked, there isn’t a better way to describe the situation than the appropriate terminology.

The saddest of all is that THEY SHOULDN’T BE FUCKED. At first, I felt super guilty for letting my dad convince me that he had $50,000 set aside for my wedding to spend without, I don’t know, asking to see all of his bank statements before signing the contract for my venue and vendors. Ok, I still feel super ridiculously guilty about this.  I feel guilty for never saying thank you in the right way for this generous gift.

BUT – it turns out, the $50,000 wedding was just one financial mistake in a list of what may be hundreds. Even if I were to repay my mother back every penny, she’d still be in quite the pickle. And I’m willing to repay every penny (my father would never let me do that, but he’s not here anymore, so there’s that.)

I’ve run the numbers. I put them in front of her face. I try to share how each year, not counting the tax debts and family loan she’s overspending her income $40,000-$50,000. Despite her $50/$60k or so after tax income with her SS and Pension, she’s still draining her IRA. She keeps saying she’ll take money out of the IRA. I keep telling her the IRA won’t last forever or anywhere near it.

The house has to go. I really, really, really don’t want it to go. I know it’s just a house. It’s just a stupid piece of property with a dumb room that I lived in for my first 17 years of life. It’s just a dumb piece of wood that has so many memories good and bad all jumbled up in it that I see maybe twice a year if I manage to make it out to the east coast that often and with it I can escape back to childhood and feel like there’s some sense of stability in the crazy fucked up world, but that’s not enough reason to keep a house that’s costing my mother $40,000+ a year to maintain and that isn’t even counting big fixes like… needing a new oven (it hasn’t worked in years now) or a roof or carpeting or anything else.

But I tell her over and over again that the house needs to go, and now that I’ve run the numbers, sooner than later. I tell her I’d love if there was a way to keep it, but there isn’t, and the best thing to do financially is to sell it ASAP. That means starting work on getting it ready for sale NOW. But she’s down in Florida in her winter condo, swimming for a few months. I’ll give her this winter — her abusive husband just died and left her with a bunch of unexpected debts and she needs to just get away and have some time to relax and not think about it. But then she’ll say in summer it’s too nice out and she has to go to the pool and she doesn’t have time to clean. My sister, who lives in the house for free, btw, works a minimum wage job and always says she is too tired to help with anything (her job does require her to be on her feet all day) but she lives there for free and really is no help… physically or financially….

I wish there was some way to have reasoned with my father about his spending… but he’d just blame my mother for HER spending. Well, they both spent too much. I understood and empathized with him wanting to spend his retirement income before he passed away. But he didn’t need to buy a zillion worthless paintings and sculptures at local art fairs (that now represent a rather large collection which has to be sold or donated or trashed) or all the worthless “collectables” and my mom didn’t have to spend so much on shopping and they both probably should have moved to a smaller property a long time ago (vs buying a second home which was cheap to buy but expensive to own in Florida) and…

I just feel absolutely sick because no matter how many different ways I spin the numbers they don’t work unless she sells the home. The whole tax situation is a trainwreck as well, as we’re now awaiting to find out what penalties will be assessed on some very late taxes that he refused to let my mother file on time and lied to her about having the correct amounts paid off (maybe he thought he did, I think he lost his mind in these last few years.)

You know, even at the end, my mom had to rush around to find a cemetery plot and paid top dollar because my father couldn’t handle thinking about these things and kept putting it off, despite being diagnosed with a terminal illness 13 years ago and told he had 2 years to live. Even after all that. So my mother ended up spending god knows what on the cemetery plots for both of them and funeral home expenses and all that, plus a brunch at a decent restaurant afterwards and poof there goes the money that my father said was saved for my sister’s wedding! Oh, and there was no liquid assets to speak of so my mother had to put it all on her credit card. My uncle did offer a $30k loan after we asked him for help to pay off the bills but that’s coming due next year as well and I’m sure he wants his money back and I unofficially said I’d be on the hook for it if she couldn’t pay or some reason. They have a legal agreement signed so he gets proceeds from the house when it’s sold. All that, just to pay for a funeral my father couldn’t properly plan for because he wanted to be immortal. I wanted him to be immortal to, but clearly we cannot have what we want.

And I feel guilty about moving away but I also know if I was there every second of every day these last 10 years it would be no different as my father only complained about my mother’s overspending but never ever would look at the bigger picture. I understand that being terminally ill was horrific and he couldn’t admit it to anyone so instead he just bought things as they made him feel like he would live forever, I guess, but those things are just things and I wish there was a way to bring him back and somehow give him happiness without having to just spend all this money on so much stuff that now has to be sold just to sell the house…

Even with the house sold, my mother will still be overspending, but I think she’ll be ok… if she were to sell the house immediately, which she won’t do. She says she needs years to clean it out. The reality is that she needs help to clean it out. A lot of help. Emotional and physical help. It will be very hard and stressful. It will be very hard for me as well. I certainly will struggle to part with my childhood furniture, which I thought one day might be used for my own children (especially if I had a girl), but it probably doesn’t make sense to ship it across the country, esp given right now I live in a one bedroom apartment with no room for it.

I wish I had a zillion dollars and could just throw money at this problem and be done with it. So. I have some liquid assets right now and I’m tempted to do just that. I mean, my parents paid for my college education AND my wedding so it wouldn’t be the strangest thing to pay my mom back now and help her out financially. But I also have a child and need to support my own family as I’m the breadwinner and I have serious mental illnesses and I can’t maintain my jobs for long enough and I still can’t afford a house.

I’m really struggling and I’m not sure what to do. I can just let her run out of money in a few years and go into debt, but then what? Do I just say “I told you so?” A few years ago I set her up with a Mint account and tried to teach her how to budget and it went nowhere. I think she’s starting to get why she needs to budget but she refuses to, so what do I do? She can’t spend $700 a month on food (I get how she can, I’ve done it before, but she can’t) and she especially can’t if she’s keeping the family home with its $700/mo variable home equity payments that will pop up to $1700/mo in 2020 and also whatever this tax payment plan of ~$1000/mo will be for 72 months…

Then these tax lawyers and enrolled agents want $3k-$4k to help her reduce her penalties for taxes and I’m sitting here thinking maybe we should just try to do this ourselves because she doesn’t have $3k-$4k to pay for help (if we can do it ourselves) and I’m just sick of feeling like I have to protect her from vultures who prey on the weak but also don’t want to be stubborn like my father and refuse help when it’s needed.

I could give her $100,000 but it wouldn’t solve anything, it would just delay the inevitable. I’d rather save the $100,000 for when she’s older if she really needs the support, vs now when she’d just spend it on things she doesn’t “need” though she’d say she does.

So that’s the state of that.

A Widowed Mother Who Lost Her Wealth (And a Grieving Daughter Trying to Help)

My family was never wealthy, but for my entire life we’ve been more than comfortable–comfortable enough to not pay close attention to our spending. While we never took lavish vacations (unless paid for by points acquired through my father’s work), we didn’t budget. We should have.

As an adult with my own job and an understanding of the value of a dollar (and my motto – no matter how much you make, every cent counts), I’ve managed to build up a networth of over $650k, give or take, at age 35. I want to be proud of that. I want to enjoy this as some sort of accomplishment. But I can’t. I can’t because I feel incredibly guilty and lost when it comes to helping my mother out of the financial mess she is in right now.

Some may look at her situation and say it’s not that bad. I guess it isn’t, but it will be soon if she doesn’t plug up the holes in her sinking ship. Not all of the holes are her fault–but she’s just so delusional and has no ability to stop spending. It is impossible for me to advise her beyond subtle suggestion that she cease spending when my parents paid for my college education, a nice wedding, and an overall nice life. Part of me feels like I ought to help her out and provide the funds to plug up some of those holes. And–most of me knows that even if I were to give her my entire $650k, she’d still find a way to burn through it.

This is a long story… a very long story… and one that is keeping me up at 2am with a newborn who is sleeping so I really ought to be sleeping. I can’t sleep. I can’t do anything but let my mind spin on this giant dilemma, trying to find some sort of solution to the puzzle. There isn’t one that’s pretty or that my mother will agree to. But, after sitting back and letting my recently-deceased father make a mess of the finances in his last years of life (not that I had much say in that, but I could have maybe done something… more on that in a minute)… I feel like NOW I have the opportunity to stop this sinking ship before it reaches the bottom of the ocean.

The picture was looking rather unfortunate on the first go-round of budget vs income that I quickly ran after my father passed away this summer and my mother had to make some decisions about her social security survivor’s benefits (which are confusing as hell, yet to be fully understood, and the subject of another post I’ll write one day.)

As we did more digging, we uncovered that in 2014 there was $1M in an IRA. By 2017, only $400k remained. During that time, there was the purchase of a second home which cost, including renovations, about $100k (or maybe more because my parents seemed to always underestimate the cost of their renovations and not keep tab.) There was my wedding, which, at $50k, was a lovely affair and something that made my dying father beam with joy, but was an event that never should have happened given the financial situation my father either somehow didn’t understand or hid from me and the family. He said, over and over again, he had $50k set aside for my wedding and $50k for my sister’s. He said many things. I’ll never know if he was delusional due to the cancer drugs, unrelated mental illness, old age, or maybe just a serial liar–to not only us but himself.

When he was working he was bringing in good money, at least for a middle class household. Ironically the man who left his family without a stable retirement spent his life’s work as an actuary–planning pensions for companies and accessing risk of running out of money to fund those pensions. I try to find humor in this.

But then, and I guess I didn’t realize this since I was already away at college, he stopped working around age 55 due to his obesity and mobility issues, and then shortly after that began collecting disability. His work paid out nicely for a few years, and also offered a good pension, but the reality was (and where I was blind sighted is) that the amount coming in did not cover the amount spent. I don’t know the exact gap, but it was substantial, and ignored.

Although the wedding was a big expense and the second home purchase wasn’t for pennies,  what really did them in, based on my research into the last 10 years of spending, was their crazy high expenses. My mother, ever in denial, would say she doesn’t spend like rich people do, then come home with piles of clothes “on sale” from Chicos or some “non luxury” store, not to mention a pile of face creams on auto-purchase from QVC and who knows what else. Then, there was the dining out bills, and the $600-a-month house cleaning services (I’ve convinced her to drop that to 2x at $300 a month.)

I’m not one to judge how they spent their money — they had a right to spend it any way they wanted. And I understand my father, facing certain death, wanted to enjoy his limited wealth in his final years. It was just the perfect storm of financial chaos. Even his long term care policy, dutifully paid into for many years, likely costing over $20,000, ended up going unused because he refused to admit he was dying–or, perhaps because he realized that the policy didn’t actually cover enough to not require dipping further into the shrinking retirement savings left.

With this, I’m left to wonder if my father, as ill as he was, didn’t go to doctors outside of his cancer doctor because he hated going to the doctor–or, if part of this was because he couldn’t afford the treatment. In the end it wasn’t the cancer that killed him, but issues with his heart and blood pressure–perhaps related to his cancer treatments, but undoubtedly something he could have had treated better over his life and especially those final years… but he chose to only focus on his cancer. If his goal was to die of something other than cancer, then he succeeded. I’m pretty sure his goal was to live forever and he couldn’t think of the world any other way. I get that, no one wants to admit they’re dying–but when you are facing a terminal illness and are told you have 2 years to live (and then you manage to live more than 10) at the very least you can pick out a funeral plot and prepay for a burial, not leaving your wife to run around to cemeteries the day after you die to pay the highest possible amount for both of your graves (yes, this happened. Yes, I was out-of-my-mind with a one-week-old at this time, trying to provide advice.)

But now–now the biggest issue, and the one I find saddest–is that we’ve uncovered a horrible situation regarding taxes. Taxes unfiled and unpaid. All of the numbers I’ve been running to try to save her primary home in the northeast–which, while worth $500k, has a $200k home equity loan out on it, by the way–were thrown out the window. And I threw my hands in the air. I give up. This is looking bleak. Sure, she can cut all of her spending. She can stop the house cleaning services and limit work on the house to only vital fixes for a while… nothing cosmetic. But even then, she starts dipping into that small $400k IRA immediately–which shrinks to almost nothing after the taxes are paid, and she has nothing left to pay the home equity that comes due in 2020 and flips to principle and interest at 3x what she’s currently paying.

In short, the only real answer is to sell one of the properties, and sooner than either of us would like. I’ve told her clearly that the northeast home, while a place that holds all of my memories as a child, and one I’d love to keep, is a complete money suck and sadly I think it needs to go. She agrees, but wants years to clean it out (she’s a hoarder and my attempts to help her get rid of things on my last visit, outside of taking care of a 3 month old, did not make a lot of progress.) I selfishly want the house to stick around for a while too–although it won’t be the home for my “dream” visits with my family… holiday visits to grandma and grandma — long summer nights with my kid(s) playing in the backyard through the sprinklers, running after fireflies like I did as a child–I thought maybe a smidgen of this could exist.

I know a house is just home and a home is just a house. I’ve lived enough places since leaving that house now… gasp… 18 years ago. I mean, I knew, deep down, we couldn’t hold on to it forever. Mom would move out when dad died at some point. But either time went by too fast or I didn’t think it would be this soon. She clearly wants to stay there… but it’s not possible, especially not with the vacation home as well.

She could potentially sell the vacation home, which would pay off some of the home equity. But she doesn’t want to do that, and I think it wouldn’t be wise anyway–they invested quite a bit in renovating that property and, while it’s small, it is a good place for her to live in her “young” old age. Even though some of her friends still live in our development in the northeast, many are moving away, and few still go to the social gatherings she goes to–whereas the 55+ community with the vacation home is filled with active seniors, at least in the winter months. I’m worried about how she’ll like it there in the summer when it gets extremely hot with violent storms and most of the residents leave to the north–but maybe she’ll be ok. She seems to find people to talk to wherever she goes (or talk “at”, but to her there’s no difference and she’s pleased either way.) So, the financial planner in me says — get her out of the northeast home as fast as possible. Like, yesterday fast.

But she’s committed to not moving until at least 2020, and she still thinks she can make it there much longer. She keeps asking me how long she can stay and I try to explain to her that there’s no exact number because the question becomes how much she needs left in her IRA to grow to afford her lifestyle–AND what is going to happen to her later in life if she needs long term care (since my father cancelled her long term care policy years ago saying it was too expensive.)

Now, she does have an after-tax income of $60k+ per year once she gets full social security benefits. That’s pretty darned good. If she had one home, especially one home that doesn’t cost as much as one with a lot of property and an aging architecture, then maybe she’ll be fine. She can sell the house, pay off the home equity, take the remaining $250k or so to pay off the taxes (est $80k) and family loan ($30k), and then take the remaining $150k and, ideally, invest that somewhere safe, while slowly drawing down the IRA and minimizing tax damage in the future.

She could, alternately, sell the vacation condo and put that money into the northeast home, but the costs are just too high there and she’ll still run out of money. I think with the vacation home she can actually live on her income, even if she wants to travel to visit her grandson or spend some time in NY.

The problem is, the longer she stays in the NJ home, the harder it is to ensure her life when she moves is financially ok. What I don’t want to happen is that she burns through her IRA in a few years because of credit card bills and loans and having to pay this ridiculous amount of taxes that sadly are just so high because of penalties due to my father not filing (yes, getting to that in a minute)…

So the taxes… I really don’t know what happened. My father always, ALWAYS paid the right amount each year. He didn’t always file on time–but if you pay the right amount and don’t file the IRS doesn’t actually care. Somehow, whether on purpose or by massive mistake, he was short about $23k one year and $18k the next. The $42k in taxes owed is crappy, but the penalties on that because it was never fixed are what is extraordinarily sad. For that money, not only did he take too much out of the IRA in two years to cause such high taxes owed, but he ALSO then didn’t pay those taxes or file or anything. I want to ask him WHY? But I can’t. Because, you know, he died. And I’m still dealing with processing that and all these feelings I have around wanting to empathize with him for being such a sad, sick man but also then being angry and grateful and who knows what else–is why I can’t sleep.

I’m now looking at any tax relief available to my mother, but it seems unlikely she will get any help from the IRS. Innocent Spouse theoretically applies to her–my father was abusive to her for years and refused to let her partake in household finances, even when she offered, and later, begged–especially regarding the taxes. He would yell at her and occasionally become violent. There are even police records of this (though not in the years the taxes are owed.) But “innocent spouse,” as far as I can tell, is for partners who lied on their returns. Well, he didn’t file a return, so there’s not much innocent spouse we can claim…

Now there is an abatement of penalty clause where, if you were in good standing the 3 years before the year you failed to file, you can get the penalties waived for that one year. But you only get to do this once. Not only was my father failing to file year after year (always having paid the full amount on time except apparently in 2011 when he had a small payment plan), it’s impossible to know if he already requested this one time penalty abatement. There are no records. He did all of his own taxes. My mother is perplexed–after going through all the of the papers… she says to me, it doesn’t make sense–where are all the taxes? The papers from the IRS?

My theory is he, either strategically or in a rage or in a fit of paranoia, threw them all out one day. Maybe he just straight up lost his mind and got rid of a box of important things by accident. Maybe he realized he did that and was so ashamed he just gave up on ever doing the taxes. Who knows.

One thing is for sure – he refused help–even from his few close friends and his family. And, for a man who said he wanted to leave his family with wealth and ensure his wife was financially ok for the rest of her life (which never made sense to me given how emotionally abusive to her on a daily basis) he sure made quite the mess. He just couldn’t admit he was struggling. He had way too much pride. And, in his final years, he didn’t want to accept his mortality. He told my mother she was overspending, but then he’d overspend himself. He once asked my mother how much my aunt and uncle gave me for my wedding — $500. He immediately wrote out a check to their daughter for $600! It wasn’t about generosity with him, though he’d like you to think it was. It was always about showing off how generous he was.

Even during the year of my wedding–I offered to pay for more of the wedding up front, even if he wanted to pay, so he wouldn’t have to withdraw so much out of his IRA that year. I knew the taxes would be high. No, he said. He was offended by the suggestion. He had the money and he wanted to spend it. Yes, I have guilt for spending it, but I didn’t know how bad things looked. Last I heard there was still $1M in the bank and a home that was paid off. I failed to dig in too much–but as blind as I was with eyes shut to the downfall of the great American dream, my mother seemed to have clawed her eyes out in order to be incapable of looking.

So now what? I have my own life to sort out here. I’m doing well, but have a long way to go. My first batch of RSUs vest in a few weeks… and with that I should have a $50k bonus after tax (should the stock market not completely disintegrate before Christmas) and I could say, you know what, mom, you guys paid for my college and wedding, and now I’m gifting you $50k (or, $15k in 2018 and $15k in 2019 and so on.) But what good would that really do? She needs to understand the value of money. I think I’m starting to get through to her a little bit. I paid for dinner the other night and she actually said thank you. It’s not that I want her to have to thank me – it’s that I want her to realize the value of a dollar. It may be too late to fix this mess… but maybe it isn’t. Maybe I can gift her a happy next however many years she has… for as narcissistic and childish as my mother is, I still think she’s been beaten down by an emotionally abusive mother then an emotionally and physically abusive husband, and she deserves the right to happiness in her old age. She has to throw out the clutter and really be wiling to simplify… and that would be good for all of us.

I just don’t know if I can convince her of this in time, and also let go from my crazy ideas to “save” my childhood home by either purchasing it or providing enough money in gift form to pay off the home equity or… plenty of bad ideas that not only wouldn’t help stop the bleeding, but also could financially ruin me as well. So I hope we can all make the right decisions and fast enough to stabilize and move on from this challenging period of our lives.

I do not want to lose my job.

I’m already feeling incredibly guilty for taking a small amount of additional time on disability for PPD, and am ashamed to face my colleagues when I return to work, especially knowing that I will be taking additional (legally-protected) leave in the next year to spend time with my kid. I hate, hate, have being THAT woman and would not blame my employer for figuring out the fastest way to show me the door.

I’m hoping that won’t happen. I don’t pray, but I’m praying that won’t happen. I just can see how they’re understanding how they can operate perfectly well without me, and they would rather replace me with someone else–or any mistake I make will be a quick reason to show me the door. I feel bad for becoming a mother and worse for not adjusting well to motherhood.

When I return to work, I really need to bring my A-game, from day one, through day a billion. I always try to do this, of course, but now I have to fight hard and strong to keep this job. I don’t deserve it, I am not good at it, and I have to try hard to do whatever it takes to be a good employee. I don’t know how to do this, because I’m socially awkward, unintelligent, and a complete fraud. But I’ll try. I’ll try and I’ll stop telling my husband I’m going to get fired because it makes him upset and he says I need to stop telling myself this because I self sabotage.

How can I keep this job? Like, really keep it. For at least three more years. Twelve more quarters. Thirty-six more months… 1095 more days…of amazing, irreplaceable-quality work.  Non stop. Full energy. Listening to my coworkers and doing whatever it takes to help them achieve their goals. Helping my boss who already looks great look even better. Being a team player. Never asking for anything other than the opportunity to do what’s right for the team and company. Maybe, maybe I can keep this job those 1095 days.

It’s a whole new ballgame now, being a mom. I’m terrified. I feel very alone in this journey and need to figure out how to just make it work, on my own. I wish I was smarter… higher IQ… or at least better at faking it. I’m so scared right now. It’s like I’m hanging onto a cliff with one hand with hurricane force winds swirling around me and gravity times a thousand puling me down. I’m holding on for dear life. I want to somehow minimize my interaction with others… I’ve been far to personally invested in my work projects. I get too emotional. I care too much. That’s the problem. I need to care less and do more.

There has to be a way.