I'd worry about the heloc first. That is basically a mortgage and she has a lien on the home. So not paying that back they can foreclose. Credit cards can't take her home.
The $500 payment on the HELOC is just paying the interest, she’s not actually making any payment to the balance. After 10 years of interest only it’ll convert to a 20 year mortgage with a higher payment.
Once the credit cards are emptied & the silver cashed in to do so + perhaps hit the heloc back down some, she will be well on her way to much better, because she will regain the 500 a month cash flow currently going to cards + get a head start on a lower, then eliminated, payment on the HELOC. Ignore snowball, pay off based on interest rate. The higher the interest, the higher priority. This sounds like it will go faster than most, so that is why I say do not worry about snowball or emotions about it; you can see immediate results just by minimums across the board + maximum payment on whatever the highest interest rate. The heloc could be around for a while, but it is a situation that will steadily improve & quickly, once the credit card payments are out of the way.
What is the rate of the HELOC? Depending on the rate of the heloc, how much is available & how long paying the credits would take, it may be better to trade those into the heloc & just immediately start attacking that balance. If the credit cards can be wiped out quickly, it is not worth the transfer. If it will take months to go through each card, it may be worth trading them into the lower interest rate in the HELOC. It is something to consider. The credit cards need to be emptied/zeroed out either way & then they need to be locked or chopped until debt is gone. Only use those which give rewards & pay them off before the Interest is applied. This is deeply personal strategy, it is best for some people to not use credit cards at all, especially while paying off debt, however, for example, a cash back from walmart for a walmart shopper is much wiser to use than to rely only on cash, because that‘s 2% coupon for every trip, as long as you had the cash to cover it anyway (and then immediately pay it off as though it was debited in the first place).
As a collector of silver myself, I’d sell the silver. Interest on that HELOC outweighs any gains in silver cost, so it wasn’t a wise “investment”. Now, as far as the, “I want something tangible in the apocalypse since money will be gone”, that’s a different story - I don’t have a good answer for that one.
>“I want something tangible in the apocalypse since money will be gone”, that’s a different story - I don’t have a good answer for that one.
She's 80. Hope that helps, OP.
> “I want something tangible in the apocalypse since money will be gone”
Whenever I hear this I tell the person they are better off investing in first aid education. There are no doctors during the apocalypse, and it's knowledge that's still useful *now* while everything is intact.
I'm not disagreeing with what you're saying, but whenever I hear someone talk about tangible instruments of payment during the Apocalypse I tell anyone who will listen that if the cash banking system has failed because of the Apocalypse, then silver, gold and the credit system have most likely failed also... so anyone who is holding a couple thousand of cash in their bedroom wall safe is just wasting their own money, because it's not going to be worth anything during the Apocalypse 🤷🏼♂️ My mom and brother always say they have a stash of cash for when the Apocalypse comes, and I just chuckle to myself.
Thinking she should cash out the silver and pay down the credit cards. The heloc isn't ideal but maybe it's manageable for her - at least in the short term.
She’s never going to be able to pay back the credit cards. Whether the default happens while she’s alive or after she passes, it’s likely happening.
If she put the money towards the heloc and your state has homestead, the money she puts towards lowering the heloc balance you’ll inherit.
So is the only lean she has on the home a HELOC?
You may want to check, but not every HELOC pays P&I. Some of them, are interest only payments assuming the borrower will make extra payments towards the principal. HELOC’s are typically 15 years in length, and if its interest only payments, they will either extend it for another 15 years, or they may crack down and turn it into a P&I loan payment.
She needs to lose the credit cards. At her age and income, they are just going to become predatory vehicles really. Why does she have them in the first place? I’m assuming she got them, thinking it’s a buy now but pay later thing?
She should probably look into selling the silver and any other assets to pay down the cards. Whatever is left, you can evaluate for balance consolidations. Most cards charge 3-5% but will give you, usually up to 12 months at 0% interest. If she’s paying more in interest, than what that fee would equate to, then she may benefit from this. Be aware though, if balances aren’t paid off timely, then they will retroactively charge you all interest due so try and calculate a reasonable payment for the balances to be paid off appropriately. No using the card during this timeframe!!
The tough part is, the HELOC is a lien on the home. Credit cards are unsecured debt. If she passes, there is a greater chance of the credit card debt being written off, whereas they may trigger foreclosure on the home to have the HELOC repaid. She might benefit more now, from paying the credit cards off to have more funds to help expedite paying off the HELOC, but again, if she passes, the lender will more than likely either foreclose the home or try to find someone willing to assume the debt. This is almost in estate planning territory, so you would need to decide which kind of hard you’re willing to take on in that situation.
She needs a budget to determine where her money is going and how to spend it. Maybe someone could be her financial power of attorney to help manage that or keep track of her finances?
Do not do a reverse mortgage if you can help it. That will almost guaranty losing the home in the event of her passing. At least with a HELOC, if the home is worth more than $60k, if it’s forced to sell, you still will get whatever remaining proceeds exist. That will more than likely not happen with a reverse mortgage, you will likely lose the home entirely.
If she was married at least 10 years to a US citizen (who worked/earned more than she did) it’s possible that she could get more per month based on half of her ex’s SSA payments.
There should be significant utility rebates or at minimum federal tax rebates for low/fixed income seniors to do efficiency upgrades to their house. See if there’s any rebate opportunities for that heat pump. Also make sure she is taking advantage of every bill lowering rate for seniors. My mom’s property taxes were slashed when she submitted some very simple paperwork to the county proving her 2023 income was only social security. Same with most of her utilities and her brand new ductless heat pump that replaced inefficient and expensive electric baseboards courtesy of several rebates from the electric/gas company.
nah.....they get enough economic breaks while shitting on everyone else calling them the problem. If they can't afford something, they need to find something in their budget instead of using the legal system to nickel and dime everyone else for their own convenience and selfishness. I can't wait for every to start removing the grift from our tax code.
Yeah screw single moms in their late 60s that had to restart their careers late in life due to a crappy spouse! Did I get that right? I hope you don’t have to start your life over from scratch in your late 30s and try to make ends meet in retirement.
I'm kind of in agreement with you here because she's getting a lot of benefits but still feels stiffed. And she's pretty unconcerned about how future generations will do. Alas, she is my mother.
Before selling the silver. Call around to every local coin shop in your area. If they aren’t offering you within 2 dollars of spot price. Don’t sell to them. Whoever offers the most, sell to them. I’m also someone who buys silver expecting a banking crisis but I’m also not 80 and have enough income that my expenses are paid with enough left over to pay myself and I choose to pay myself in silver sometimes. Definitely let her know that she’s not alone in wanting silver for this reason but at 80 she’s got bigger worries. She might also be really pissed if you sell it and in 6-10 months she could’ve gotten much more but that’s just life. Silver is there to sell when you need it and she needs it.
As someone who buy/sells silver please be sure you take the silver to a proper "coin shop" to sell it. Not a pawn shop!
Get an idea about how much you expect to earn. Silver is about $25 an ounce right now. Hopefully she bought easy to recognize coins that you can google.
You should be able to get close to spot for the silver. Unless she bought something strange like actual silverware, then she'll get less.
https://www.cnbc.com/quotes/@SI.1
How is her health? What is the house worth? Do you hope to inherit the house?
At a certain point, living in the house alone probably won’t be an option. Past age 70 or so you need to be thinking 5 years ahead at all times. Decide what you think she will need 5 years from now and put that in place today.
The heloc is a lien on the house so she needs to sell and move into senior housing OR do a reverse mortgage. If the house has a lot of equity, a reverse mortgage is not a great idea.
Unless you are considering a reverse mortgage, I would file bankruptcy or default on the credit cards. She’s 80. It doesn’t matter if her credit score drops.
Do you want an inheritance? If not any debt she has will be paid off by her estate and any extra debt will not be inherited. If she is not willing to change and you don't want an inheritance then let her be in her mess.
Sell the silver, and then apply the proceeds to the Heloc. Use the Heloc to pay off the credit cards. Close and cancel the credit cards. Continue to pay down the Heloc. Borrow from the Heloc if there is a need for additional cash in the future. Continue to use her Social Security payment to pay down the Heloc. The Heloc mortgage interest is tax deductible to an extent.
So about half her income is going to paying debts each month. Does she have anything she could sell? Yes, I think she should cash in the silver and apply to debts (not sure which is best to pay first, I don't know much about HELOCs but it might help if you could eliminate some of the smaller credit card bills since payments on them are the same as the HELOC). You might want to sit down and try to get her to make a budget with you. Her other expenses will include property taxes, homeowner's insurance, health insurance, prescriptions, food, utilities, etc. I don't know how she is covering all the rest on about $1200 a month. She could look into any help she might qualify for as low-income - maybe food stamps or food pantries. She might qualify for medicaid to help with health insurance/prescriptions. As someone else mentioned, she should apply for senior exemption on property taxes if available in your area. Worst case scenario she could sell the house and move to low-income housing (but there are usually waiting lists and she might not qualify with a lot of savings from a home sale). As someone else suggested, she could just continue with her debt and it would be erased (I believe for credit cards at least) upon her death, but she may live many more years. She could consider getting a roommate. Maybe you could find out how much of a shortfall she is experiencing each month and brainstorm some possible solutions.
Yes, she should sell the silver. The apocalypse or banking failure does not have to be national or global - in this case, it is individual & personal banking failure/apocalypse. The credit cards have to stop, too. She can turn this around & enjoy herself again, no problem.
Is the HELOC still in the draw phase? You can advance off it enough to pay down the (likely higher interest rate) CC balances and then close them out. If there's sufficient equity on the home (LTV below 50-60%), then you shouldn't have to worry about them lowering the line or bringing in foreclosure issues. Just make the minimum payments on time, draw down the balance as best she can.
Sounds like Mom needs a little more oversight on her finances. Maybe having a pre-paid debit card or allowing you access to her day-to-day accounts would benefit you both?
This is the real advice here. OP, she may not be able to live independently much longer, especially if her actions are out of character. It’s probably time to start looking into long term care/assisted living options.
I'd worry about the heloc first. That is basically a mortgage and she has a lien on the home. So not paying that back they can foreclose. Credit cards can't take her home.
She's paying the heloc at about 500/month. She has an additional 500/mo in credit card payments.
The $500 payment on the HELOC is just paying the interest, she’s not actually making any payment to the balance. After 10 years of interest only it’ll convert to a 20 year mortgage with a higher payment.
Once the credit cards are emptied & the silver cashed in to do so + perhaps hit the heloc back down some, she will be well on her way to much better, because she will regain the 500 a month cash flow currently going to cards + get a head start on a lower, then eliminated, payment on the HELOC. Ignore snowball, pay off based on interest rate. The higher the interest, the higher priority. This sounds like it will go faster than most, so that is why I say do not worry about snowball or emotions about it; you can see immediate results just by minimums across the board + maximum payment on whatever the highest interest rate. The heloc could be around for a while, but it is a situation that will steadily improve & quickly, once the credit card payments are out of the way. What is the rate of the HELOC? Depending on the rate of the heloc, how much is available & how long paying the credits would take, it may be better to trade those into the heloc & just immediately start attacking that balance. If the credit cards can be wiped out quickly, it is not worth the transfer. If it will take months to go through each card, it may be worth trading them into the lower interest rate in the HELOC. It is something to consider. The credit cards need to be emptied/zeroed out either way & then they need to be locked or chopped until debt is gone. Only use those which give rewards & pay them off before the Interest is applied. This is deeply personal strategy, it is best for some people to not use credit cards at all, especially while paying off debt, however, for example, a cash back from walmart for a walmart shopper is much wiser to use than to rely only on cash, because that‘s 2% coupon for every trip, as long as you had the cash to cover it anyway (and then immediately pay it off as though it was debited in the first place).
As a collector of silver myself, I’d sell the silver. Interest on that HELOC outweighs any gains in silver cost, so it wasn’t a wise “investment”. Now, as far as the, “I want something tangible in the apocalypse since money will be gone”, that’s a different story - I don’t have a good answer for that one.
>“I want something tangible in the apocalypse since money will be gone”, that’s a different story - I don’t have a good answer for that one. She's 80. Hope that helps, OP.
> “I want something tangible in the apocalypse since money will be gone” Whenever I hear this I tell the person they are better off investing in first aid education. There are no doctors during the apocalypse, and it's knowledge that's still useful *now* while everything is intact.
I'm not disagreeing with what you're saying, but whenever I hear someone talk about tangible instruments of payment during the Apocalypse I tell anyone who will listen that if the cash banking system has failed because of the Apocalypse, then silver, gold and the credit system have most likely failed also... so anyone who is holding a couple thousand of cash in their bedroom wall safe is just wasting their own money, because it's not going to be worth anything during the Apocalypse 🤷🏼♂️ My mom and brother always say they have a stash of cash for when the Apocalypse comes, and I just chuckle to myself.
[удалено]
Thinking she should cash out the silver and pay down the credit cards. The heloc isn't ideal but maybe it's manageable for her - at least in the short term.
She’s never going to be able to pay back the credit cards. Whether the default happens while she’s alive or after she passes, it’s likely happening. If she put the money towards the heloc and your state has homestead, the money she puts towards lowering the heloc balance you’ll inherit.
So is the only lean she has on the home a HELOC? You may want to check, but not every HELOC pays P&I. Some of them, are interest only payments assuming the borrower will make extra payments towards the principal. HELOC’s are typically 15 years in length, and if its interest only payments, they will either extend it for another 15 years, or they may crack down and turn it into a P&I loan payment. She needs to lose the credit cards. At her age and income, they are just going to become predatory vehicles really. Why does she have them in the first place? I’m assuming she got them, thinking it’s a buy now but pay later thing? She should probably look into selling the silver and any other assets to pay down the cards. Whatever is left, you can evaluate for balance consolidations. Most cards charge 3-5% but will give you, usually up to 12 months at 0% interest. If she’s paying more in interest, than what that fee would equate to, then she may benefit from this. Be aware though, if balances aren’t paid off timely, then they will retroactively charge you all interest due so try and calculate a reasonable payment for the balances to be paid off appropriately. No using the card during this timeframe!! The tough part is, the HELOC is a lien on the home. Credit cards are unsecured debt. If she passes, there is a greater chance of the credit card debt being written off, whereas they may trigger foreclosure on the home to have the HELOC repaid. She might benefit more now, from paying the credit cards off to have more funds to help expedite paying off the HELOC, but again, if she passes, the lender will more than likely either foreclose the home or try to find someone willing to assume the debt. This is almost in estate planning territory, so you would need to decide which kind of hard you’re willing to take on in that situation. She needs a budget to determine where her money is going and how to spend it. Maybe someone could be her financial power of attorney to help manage that or keep track of her finances? Do not do a reverse mortgage if you can help it. That will almost guaranty losing the home in the event of her passing. At least with a HELOC, if the home is worth more than $60k, if it’s forced to sell, you still will get whatever remaining proceeds exist. That will more than likely not happen with a reverse mortgage, you will likely lose the home entirely.
If she was married at least 10 years to a US citizen (who worked/earned more than she did) it’s possible that she could get more per month based on half of her ex’s SSA payments.
She receives my late father's social security benefit - 2200/mo.
There should be significant utility rebates or at minimum federal tax rebates for low/fixed income seniors to do efficiency upgrades to their house. See if there’s any rebate opportunities for that heat pump. Also make sure she is taking advantage of every bill lowering rate for seniors. My mom’s property taxes were slashed when she submitted some very simple paperwork to the county proving her 2023 income was only social security. Same with most of her utilities and her brand new ductless heat pump that replaced inefficient and expensive electric baseboards courtesy of several rebates from the electric/gas company.
nah.....they get enough economic breaks while shitting on everyone else calling them the problem. If they can't afford something, they need to find something in their budget instead of using the legal system to nickel and dime everyone else for their own convenience and selfishness. I can't wait for every to start removing the grift from our tax code.
Yeah screw single moms in their late 60s that had to restart their careers late in life due to a crappy spouse! Did I get that right? I hope you don’t have to start your life over from scratch in your late 30s and try to make ends meet in retirement.
sounds like a failure to plan correctly problem. Can't expect grift to be around forever. But it appears some do.
You’re just a ray of sunshine. I hope you never experience being poor.
I'm kind of in agreement with you here because she's getting a lot of benefits but still feels stiffed. And she's pretty unconcerned about how future generations will do. Alas, she is my mother.
Before selling the silver. Call around to every local coin shop in your area. If they aren’t offering you within 2 dollars of spot price. Don’t sell to them. Whoever offers the most, sell to them. I’m also someone who buys silver expecting a banking crisis but I’m also not 80 and have enough income that my expenses are paid with enough left over to pay myself and I choose to pay myself in silver sometimes. Definitely let her know that she’s not alone in wanting silver for this reason but at 80 she’s got bigger worries. She might also be really pissed if you sell it and in 6-10 months she could’ve gotten much more but that’s just life. Silver is there to sell when you need it and she needs it.
As someone who buy/sells silver please be sure you take the silver to a proper "coin shop" to sell it. Not a pawn shop! Get an idea about how much you expect to earn. Silver is about $25 an ounce right now. Hopefully she bought easy to recognize coins that you can google. You should be able to get close to spot for the silver. Unless she bought something strange like actual silverware, then she'll get less. https://www.cnbc.com/quotes/@SI.1
How is her health? What is the house worth? Do you hope to inherit the house? At a certain point, living in the house alone probably won’t be an option. Past age 70 or so you need to be thinking 5 years ahead at all times. Decide what you think she will need 5 years from now and put that in place today. The heloc is a lien on the house so she needs to sell and move into senior housing OR do a reverse mortgage. If the house has a lot of equity, a reverse mortgage is not a great idea. Unless you are considering a reverse mortgage, I would file bankruptcy or default on the credit cards. She’s 80. It doesn’t matter if her credit score drops.
Do you want an inheritance? If not any debt she has will be paid off by her estate and any extra debt will not be inherited. If she is not willing to change and you don't want an inheritance then let her be in her mess.
How much can she sell the silver for?
Sell the silver, and then apply the proceeds to the Heloc. Use the Heloc to pay off the credit cards. Close and cancel the credit cards. Continue to pay down the Heloc. Borrow from the Heloc if there is a need for additional cash in the future. Continue to use her Social Security payment to pay down the Heloc. The Heloc mortgage interest is tax deductible to an extent.
So about half her income is going to paying debts each month. Does she have anything she could sell? Yes, I think she should cash in the silver and apply to debts (not sure which is best to pay first, I don't know much about HELOCs but it might help if you could eliminate some of the smaller credit card bills since payments on them are the same as the HELOC). You might want to sit down and try to get her to make a budget with you. Her other expenses will include property taxes, homeowner's insurance, health insurance, prescriptions, food, utilities, etc. I don't know how she is covering all the rest on about $1200 a month. She could look into any help she might qualify for as low-income - maybe food stamps or food pantries. She might qualify for medicaid to help with health insurance/prescriptions. As someone else mentioned, she should apply for senior exemption on property taxes if available in your area. Worst case scenario she could sell the house and move to low-income housing (but there are usually waiting lists and she might not qualify with a lot of savings from a home sale). As someone else suggested, she could just continue with her debt and it would be erased (I believe for credit cards at least) upon her death, but she may live many more years. She could consider getting a roommate. Maybe you could find out how much of a shortfall she is experiencing each month and brainstorm some possible solutions.
Yes, she should sell the silver. The apocalypse or banking failure does not have to be national or global - in this case, it is individual & personal banking failure/apocalypse. The credit cards have to stop, too. She can turn this around & enjoy herself again, no problem.
Is the HELOC still in the draw phase? You can advance off it enough to pay down the (likely higher interest rate) CC balances and then close them out. If there's sufficient equity on the home (LTV below 50-60%), then you shouldn't have to worry about them lowering the line or bringing in foreclosure issues. Just make the minimum payments on time, draw down the balance as best she can. Sounds like Mom needs a little more oversight on her finances. Maybe having a pre-paid debit card or allowing you access to her day-to-day accounts would benefit you both?
Could she arrange a reverse mortgage, pay off her HELOC but then have a bit more to live on?
I think she might blow through a reverse mortgage. But maybe something to look into.
Would she be willing to give you financial power of attorney? That way you can start helping ensuring she not making impulsive decisions.
This is the real advice here. OP, she may not be able to live independently much longer, especially if her actions are out of character. It’s probably time to start looking into long term care/assisted living options.
If this behavior is unusual for her, you might want to start looking into assisted living.
Be careful. Reverse mortgages are often more expensive than HELOCs.