How do I handle an inheritance gift of $22,000?

Do you have someone who said they would provide care? Do you plan on gifting them the $22K and then have them care for you out of your basement. That is asking a lot of someone if it goes on for years. If you only get $790 a month, it will not even cover an extra mouth to feed if you need 24/7 care. Someone would need to pay their own bills. This sounds a lot like what I do for my mother, and it has been very difficult on me.

One thing we don't want to do as we age is transfer our difficulties onto someone else. It may be a better idea to sell the home and move into a senior community to provide the things you need. It is what I plan to do. Who needs the aggravation of managing and maintaining a house that has become too big? Houses are fine when there is family in it. They're a burden when it is just one or two.

Hi, anitarhoney (pretty name!),

How old are you? If you only receive $790 monthly, how do you pay property taxes and such on your home each year?  

Do you have any medical issues at present? Are you in America? Is the $790 you receive a Social Security benefit?  Do you have Medicare coverage?  What about Medicaid coverage?  

I think you would get better input if you can provide more details.  In general, I think Jessie is right, and I think there is a better way to plan for your long term living arrangements rather than investing in and staying put in your house.

My mom did this. Finished/remodeled basement with the intent of having someone care for her at home as her long term care policy would have paid for a caregiver. Enter dementia and a very dysfunctional family. I cared for mom for four years in her home. Twisted sisters thought I was taking money from her and even called APS to investigate. Case closed, but at that point I realized I needed an attorney to protect me from twisteds. Even though they thought the care mom was receiving was excellent they did not want their inheritance spent to pay me for her care. The LTC policy lapsed under the eye of TS, mom's POA. Long story short, court ordered I be paid for two years. Twisteds continued accusations of one thing or another wore me down. Now mom is in a facility paying on the order of 10k a month, much, much more than court ordered I be paid.

It is much preferred for most to remain in their homes. The reality is it is very expensive. And to think that you may be able to find someone to care for you in exchange for room and board is not realistic, nor is it legal. Check with the IRS, these sorts of arrangements the caregiver is considered an employee, you would be paying a salary, social security, Medicare, taxes, etc for a live in. It does not sound like you have the resources for this sort of a care situation.

anitarhoney, I know these ideas sound great in our mind, but you need to think further ahead.

When it comes time that you need someone to help you as you age, then eventually the live-in caregiver would be doing the job of 3 full-time caregivers each and every day. That becomes physically and emotionally exhausting. Then you would need to hire someone new.

You would also need to pay the caregiver, and some States require overtime pay for someone who works over a certain number of hours each week. Plus, you would need to buy a "workman's comp" rider on your homeowner's insurance in case your "employee" gets hurt on the job. You could use a check paying service to do the payroll checks for you, for a fee.

My Dad had 3 full-time caregivers each day who each worked an 8-hour shift, and that cost climbed up to $20k a month. Dad found he could cut the cost more than half by going into Independent Living, then later into Assisted Living/Memory Care.

There is so much to think about.

I'd consult with a professional about estate planning and/or a financial expert and how you might get care and support in the future, if you should need it. I agree with all the points mentioned above about planning to stay in the home with the help of another. It's very risky, because sometimes, that just isn't feasible. Also, so many things could happen that might cause your investment to be unrealized.

$22,000 sounds like a lot of money...in reality, it's not that much. If you are thinking of asking someone to move in with you and care for you, letting them have the downstairs apt....you'll still need to pay them. $22K won't cover 2 years of PT care.
So, IF you spent the inheritance on fixing up an apartment, what are you going to pay your caregivers with?
We ALL want the luxury of having our needs met the way we want them to be....but not necessarily the money to do so.
I'd tuck that money away and wait and see how you feel in a few years. Or fix up the apartment and use the money from rent for care in your home later. I don't know where you live or what you could get for rent...but having the renters be separate from your caregivers is not a bad idea. If you could get, say $800 a month in rent, you could use that towards caregiver expenses. Also, fixing up your home would increase its value if you needed to sell it. (A friend of mine is actually in the process of doing it. She will get $1300 a month in rent for a 1200 SF apt.)

Oh--and to add to the first post of mine--my friend has the "tenant" shovel her walks and mow the lawn if they want a $100 reduction in rent. She likes having someone in the house, even though they don't interact with each other. When and if she needs in home care, she can use the rent to pay for it. She just saves it, now.

anitarhoney, if you do decide to rent out the basement apartment, make sure local zoning will allow this. Some areas do not.

Also, make sure you do a radon test of the basement space, because if there is a higher than normal reading, you would need to have that fixed, as high radon can cause serious lung issues for anyone who sleeps down there.

And make sure you have windows in the basement that are large enough so that a fireman can climb through while wearing an oxygen tank.

Just more things to think about... [sigh]

Turning a basement into a living space will probably cost more than $22K.
I don't know how you manage to live on $790 a month and why you receive so little. I only worked long enough to have the required 40 credits but get over $900. Do you get any kind of supplement such as meals on wheels or Medicaid. I think a bettor idea would be to move into an apartment preferably with rental assistance, or assisted living if you can afford it. As well as your income do you have significant savings to pay for things like taxes, insurance and other essentials.

My goodness. Didn't expect such great help and ideas. See, there are such good people out there and I hope I get a few I can trust and turn to for help. I posted more info and hope you fine people read it and continue with such great help. I truly appreciate it. Super!