Jewish World Review May 11, 2000 /6 Iyar, 5760
Your heirs, your choice
DEAR BRUCE: My husband and I have been married for 20 years. This is a second marriage. He had three kids by his previous marriage, and when his youngest turned 21, my husband's house was sold and the money divided three ways.
In 1981 my dad passed away and left me his home. I went to an attorney, and he said that if I passed away first, my husband would get a big part of the house. I would like to leave my home to my grown children. I want to protect my family as he did, but he won't agree to sign anything. No one ever supported me -- in fact, I have supported him. -- D.K., Worcester, Mass.
DEAR D.K.: Whether you can transfer this property after your death to your kids could be questionable, but I know of no reason why you can't do it while you are alive. Why not give the house to your children? If it is in your name, I see no reason why you can't do that, giving you (and if you wish, your husband) life tenancy. This means both of you will have to pass away before the children can do anything with the house. Either you may continue to pay the taxes or it could be the responsibility of the folks that you give it to.
Why your husband won't sign is another issue, but I'd certainly do an end-run around him if I could. He did what was best for his kids; why should you do any different?
DEAR BRUCE: We are 65 and 63, and have a $65,000 mortgage on a new home. We have about $140,000 in IRAs and savings, and $1,700 monthly income. Our IRAs are doing well, but we have given some thought to paying off the mortgage. What do you think? -- K.A., via e-mail
DEAR K.A.: Strictly from a financial point of view, you would be better advised to retain the mortgage. At your age, however, there is a certain comfort level in owning a house outright. Either way, you are going to have to play it very close, given the relatively small amount of savings that you've put together. On balance, if it is anywhere near a wash, I'd go for the comfort zone.
DEAR BRUCE: In your opinion, is long-term nursing-home insurance the best way to protect your assets in the event that you need to go to a nursing home? If not, what would you suggest? -- L.G., Coatesville, Pa.
DEAR L.G.: The very poor have no reason to consider nursing-home insurance, as the government will take care of them. If the wealthy -- those who have somewhere in the vicinity of $50,000 yearly income per person -- required nursing-home care, they could likely stay there indefinitely given their retirement income (even if it had to be subsidized from savings in some expensive parts of the country).
The folks in the middle are the ones with a serious problem. They would like to protect their assets; and yet nursing-home fees could diminish them in a matter of a few years, particularly if both husband and wife have to be confined. For those folks, nursing-home insurance is a matter to be seriously considered. How old you should be when you purchase it is another question. The older you are, the more you will pay.
My best judgment would be this: If you are in excellent health and don't anticipate any problems in the near future, age 60 would be a good time to consider putting a plan into
Send your questions to JWR contributor Bruce Williams by clicking here. (Questions of general interest will be answered in future columns. Owing to the volume of mail, personal replies cannot be provided.) Interested in buying or selling a house? Let Bruce Williams' "House Smart" be your guide. (Sales of the book help fund JWR).
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