No crystal ball

Laurie MacNaughton © 2018

“My mother’s home was paid off, and at the time we thought a home equity line was going to be the best way for her to pay medical bills. But at this point the payment is crushing her – and she has new medical bills coming in. Looking back, what we really needed was a crystal ball.”

Truth is, a crystal ball would come in handy in much of life. It’s just that more is at stake when we’re dealing with our aging parents.

No honest lender is ever going to tell you a reverse mortgage is a universally good fit: there are older homeowners for whom the time has come to sell their home and transition into other housing. Some are better served by doing a traditional home equity line of credit (also called a “forward” line of credit). And there are those who benefit from drawing down monies under management.

But for homeowners who wish to stay at home and need to leave managed retirement accounts untouched as long as possible, or for those with Medicaid considerations, a reverse mortgage may be the perfect fit.

If you would like more information on how a reverse mortgage might help you or your loved one with retirement plans, give me a call. I always love hearing from you.

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Soldiering Through: Men on the Front Lines of Caregiving

Laurie MacNaughton

When my firstborn was barely two she and her best friend, a little boy named Willoughby (really), spent the afternoon playing with an assortment of stuffed toys. While Willoughby practiced drop-kicking the animals against the wall, Jessica sat diapering them. When I fed them peanut butter sandwiches for lunch, Jessica nibbled hers into a rainbow; from his, Willoughby manufactured a gun.

Assertions of my feminist friends notwithstanding, as the mother of girls I firmly believe it is the easy province of a woman to care for the weak, the sick, the young, the aged. And, be it nurture or nature I think these tasks come harder to men. Thus, I have unqualified respect and admiration for what seems to me to be an increasing number of adult sons serving as primary caregivers for aged and infirm parents.

I am just returned from visiting my own mother whose agonizing last chapter is rapidly drawing to a close. Seated beside her, hour after hour, is my oldest brother. A retired Bell Labs particle physicist and former Ivy League professor, this caregiving role is not an easy fit. Yet there he sits, tending her unglamorous, repetitive, relentlessly-increasing needs. I took his place as much as possible during my stay, and invariably he headed for bed in an attempt to catch up on months’ worth of missed sleep.

For my part, when my mother slept I returned phone calls. Back-to-back I spoke with two men, one a prospering real estate broker who, weekends, travels a thousand miles each way to help with his mother’s care; I then spoke with an aging adult son serving as primary caregiver for his advanced elderly father. Not many days earlier an elder law attorney called me in reference to a client trying valiantly to honor his mother’s wish to age in place, despite her degenerative condition.

Then tonight, Thanksgiving night, as I drove home from the airport I took a call. An unspoken universe of sacrifice implicit in the adult son’s one statement hit home in a way he could scarcely imagine: “My concept of normality has gone to pot,” he said simply.

Nothing more need be said, my friend. Well am I aware of what you have forgone to care for your mother. And well I know how meager is the support for a man serving on the front lines in this role as primary caregiver.

Residential managed care has an indispensable function in today’s world. Professional in-home caregivers are invaluable, and hospice a godsend. But rarely are any of these the full solution to aging parents’ needs. It is appropriate that family cares for family – and there simply is no substitute for family.

So men – those of you who diaper and dress and swab and shower an aging parent, who mop and launder and scour and scrub until late into the night: you are an example to all of us privileged to know you.

And if you would like to talk about help financing your aging parents’ needs – or would just like to talk – give me a call. I always love hearing from you.

Laurie

Laurie MacNaughton [NMLS 506562] is a freelance writer and Reverse Mortgage Consultant at Middleburg Mortgage, a Division of Middleburg Bank. She can be reached at: 703-477-1183 or LMacNaughton@MiddleburgBank.com.

In-Flight Reflections Tapped Out on an iPhone

Laurie MacNaughton

Thank you, Michael P.

But maybe I should back up a bit.

This morning as scheduled my iPhone alarm went off at 3:00 AM. And as scheduled by 3:30 AM I was out the door and on my way to Baltimore Washington Airport. But that’s where the last of the morning’s plans went off as scheduled.

Even by DC standards traffic was oddly heavy for early morning, and by the time I pulled into BWI long-term parking I knew it was going to be close. Then, the terminal shuttle – which I could see from the bus stop – sat parked a good five minutes before making its rounds. However, there was still time to get my boarding pass and make it to the gate…if everything went smoothly. Which it didn’t.

For some reason every self-serve ticket kiosk was dedicated solely to members of the armed forces, meaning the backup at the service counter was tremendous – and it was not yet 5 AM.

To say I travel light doesn’t begin to tell the story: last year I packed in a book bag everything I needed for a three-week international trip. But not so for many of my co-travelers: this morning the French couple immediately in front of me apparently had prepared for the coming global clothing shortage, checking in a remarkable six suitcases – each. In front of them were first-time parents who clearly hadn’t yet learned just how few of those fancy baby accoutrements really are necessary. But finally I had my boarding pass and was free to race through the airport.

And then security.

Enough said on that front – other than the observation that if world peace ever breaks out, we should seriously consider repurposing TSA agents as speed-control personnel and altogether forego every other form of speed constraint.

By the time I finished re-robing and re-packing my electronics, I embarked on my morning’s second marathon with a growing sense of futility: by now nothing short of transformation into a photon was going to get me on my flight.

And I was right.

The plane still stood at the gate, and though the agent was able to walk onto the plane to speak with the attendant, she came back with a message I can only assume was supposed to convey something: the “final numbers were already entered.” I had missed my flight.

Over the years I have missed many flights. I have been stuck in DC traffic and gotten to the airport too late. I have been at JFK an hour early only to have my flight cancelled. I have been in international airports when gate changes were announced in English so heavily accented I couldn’t understand the announcement. I have been on Air France flights that were so late my entire connecting itinerary was useless. But never have I missed a flight when I stood in line praying my mother would live long enough for me to reroute my journey.

Now enter Michael P.

Or more precisely, thank you, Michael P, for not entering. I have your seat on American Airlines. And because I have your seat I will land a full hour earlier than I would have had I made my original flight.

I hope you’re ok – and that you have flexibility in your travel plans.

With my mother at the very end of life’s runway, life seems remarkably short. Certainly life is remarkably complex.

And sometimes, life is just remarkable.

Laurie

Laurie MacNaughton [NMLS# 506562] · Reverse Mortgage Consultant, President’s Club · Middleburg Mortgage, a Division of Middleburg Bank · 20937 Ashburn Road, Suite 115 ·Ashburn, Virginia 20147 · 703-477-1183 Direct · LMacNaughton@MiddleburgBank.com

Harland, Hindenburg…and Harney

Laurie MacNaughton

April 15, 1912, while on its maiden voyage, the RMS Titanic struck an iceberg and sank within three hours. The ship carried far too few lifeboats, and 1,502 passengers and crew died. Harland and Wolff, who hired the naval architect, was not available for comment for this blogpost.

May 6, 1937, German airship Hindenburg caught fire, exploded, and plunged to the ground at Lakehurst Naval Air Station. Thirty-six people died. The German dirigible had not been designed to use hydrogen; rather, the Nazi government switched to the alternative gas when helium was not available. Neither the Hindenburg’s pilot nor its designer was available for comment for this piece.

Let’s add another historical tragedy:

According to a July 19, 2013 Washington Post article by Kenneth R. Harney, in 1997 Sarah C. Hoge took out a proprietary reverse mortgage. This private-label mortgage was not the FHA-insured reverse mortgage overwhelming represented by today’s reverse mortgages. The terms of Ms. Hoge’s mortgage were apparently horrendous, and her estate is still seeking resolution of issues caused by this terribly-designed product.

Early private-label, non FHA-insured reverse mortgages were filled with structural peril and some left true devastation in their wake; few reasonable minds differ on this point.

The Post’s Mr. Harney, however, appears either remarkably biased against today’s reverse mortgages, or woefully uninformed on their basic tenets, as evidenced by his statement, “Reverse mortgages…can be…potentially costly for [elderly borrowers’] heirs.” I respectfully refer him to the FHA HECM website http://www.hud.gov/, specifically section 6 which states, “No debt is passed along to the estate or heirs.”

Mr. Harney, if you are seeking a crusade, let me recommend you turn your sites toward the proliferation of hard-money lenders, the financial source some seniors seek out when scared away from the FHA-insured reverse mortgage – by articles such as yours, as self-reported by seniors themselves. This scaremongering is unbefitting a contributor to a reputable publication, and is a tragedy in its own right.

The historical movement of tragedy is regulation, redesign, redress and remediation – whether we’re speaking on topics of engineering, medical techniques, political systems – or financial products. As it has matured into the mainstream of financial products, reverse mortgage has gone through these selfsame stages, and has come out far better for it. I believe I am not alone in wishing journalism would go through its own maturation process, moving from sensationalistic pieces to well-researched reporting.

The FHA-insured reverse mortgage is never going to be the full solution to financial needs in retirement. However, when used as part of a comprehensive financial plan, it is going to be an increasingly important part of funding Americans’ ever-increasing longevity. Irresponsible or ill-informed reporting does no one any favors – not seniors, not their heirs, and not an esteemed publication.

Laurie

Laurie MacNaughton [NMLS# 506562] · Reverse Mortgage Consultant · 20937 Ashburn Road, Suite 115 · Ashburn, Virginia 20147 · 703-477-1183 Direct · LMacNaughton@MiddleburgReverseLady.com

Visit my Informational Blog at https://middleburgreverselady.wordpress.com/

The Incredible Journey Revisited

Today was one of those days – filled with one weird difficulty after another. But late in the afternoon my phone rang. It was Lisa Thomas, inviting me to her grandmother’s 88th birthday party.

It has been a couple years since I have thought deeply about what came to be called The Thomas Project. But hearing Lisa’s voice made me track down the piece that originally ran in a Loudoun County publication. The intervening years have made the story seem even more remarkable than it did at the time.

Loudoun County Area Volunteers Assist Elderly Couple

September 2011

In 1952 when Ed Thomas and his bride Virginia bought a home on the outskirts of Leesburg they were young, full of expectation, and looking forward to life together.

It was in this small wooden home that Ed and Virginia raised their children, played with their grandchildren, and experienced the joys and hardships that make up the fabric of life.

But by 2009, both Ed, now ill with cancer, and Virginia, suffering from diabetes, had had extensive medical procedures and were hospitalized. They wanted nothing more, however, than to live out their days in the home they had shared for more than fifty years.

The home, however, was now uninhabitable: the toilet had partially fallen through the floorboards, an exterior bearing wall had major damage, the chimney had collapsed, there was no central heating, and the front steps had rotted and fallen off the porch. Both the home and yard were filled with decades’ worth of cast-offs belonging to extended family. Restoring the home to a livable condition was beyond their reach.

Beyond their reach, that is, until the Thomases’ granddaughter, Lisa Thomas, contacted Laurie MacNaughton, reverse mortgage specialist with Wells Fargo Home Mortgage. MacNaughton, after fruitless calls to multiple local organizations, contacted Round Hill United Methodist Church of Round Hill, Virginia, which counts several contractors among its members. Professionals from the congregation inspected the home and agreed to take on the project.

“Our goal, plain and simple, was to repair the Thomases’ home to habitable condition. They spent their entire married life there, and understandably they want to spend their final days together in their home. There are those of us in the Leesburg area with the professional skills necessary to carry out this project, and the determination to make it happen,” says Steve Simons, area manager of Handyman Matters.

Manpower for the ground-up renovation was provided by professionals and volunteers from Round Hill United Methodist Church and the local community. The Home Depot in Leesburg supplied building materials, and McCrea Heating and Air provided an HVAC unit. Thousands of man-hours over the course of more than two years, and overseen by Handyman Matters’ Simons, went into the reconstruction.

“I am so overwhelmed and blessed that there are actually people in this world willing to help,” says Lisa Thomas, granddaughter of Ed and Virginia. “For a year I tried to help my grandparents get back into their home, but I didn’t have the resources to make it happen. All my grandparents wanted was to be together again. Round Hill [Methodist Church] has done a wonderful thing. Steve [Simons] has been amazing. And none of this could have happened without Laurie [MacNaughton]. Honestly, I have to keep pinching myself to be sure is really happening.”

“This entire journey has been one of a church’s and a community’s generosity, love, and remarkable perseverance,” says MacNaughton. “I think of it as ‘NIMBY’ in reverse. This community came together and said, ‘We simply are not going to know about this kind of suffering in our own backyard and just turn our back. As long as we have the ability to remedy this, we are putting our hand to the plow.’ I only wish Mr. Thomas had lived to see this day.”

The Thomas home is now fully complete, and has all the charm associated with a grandmother’s cottage. It has been outfitted with handicapped-accessible amenities, including a roll-in shower, transfer toilet, wide doorways, and a specially designed kitchen.

On September 28th the extended Thomas family, along with members of Round Hill Methodist Church and the community, will welcome Virginia Thomas home with a ribbon-cutting ceremony and celebration.

Laurie MacNaughton [NMLS# 506562] · Reverse Mortgage Consultant, President’s Club · Middleburg Mortgage, a Division of Middleburg Bank · 20937 Ashburn Road, Suite 115 ·Ashburn, Virginia 20147 · 703-477-1183 Direct · LMacNaughton@MiddleburgBank.com ·  www.middleburgmortgage.com/lauriem

Visit my Informational Blog at https://middleburgreverselady.wordpress.com/

Adult Children Supporting Aging Parents – The Gift That Keeps on Taking

A question I get asked a lot is whether I run into greedy adult kids who don’t want their parents to do a reverse mortgage.

Answer? Yes. But rarely.

More common by far is the family I met with Sunday – a wonderful, functional extended family which includes two adult sons and their widowed mother. Since their father’s passing three years ago the sons have been supplementing their mother’s meager income. However, each son has children approaching the college years, and the mother’s medical expenses are on the rise. They know they cannot continue supporting their mother at the current pace.

The gift that keeps on taking

We all have heard one thing or another referred to as “a gift that keeps on giving.” I have come to call the financial support of an aging parent by an adult child “the gift that keeps on taking.” Money the adult child should be setting aside for retirement is instead being gifted to an aging parent to augment insufficient income.

A short aside about gifting

Currently you can gift another person $14,000 per year before hitting a tax liability. This is called the annual gift exclusion.

In addition to what you can give per year, there is a lifetime exclusion. In 2013 the lifetime exclusion is set at $5.12 million. Gifts that exceed the annual $14,000 limit count against the lifetime exclusion. Frankly, for most Americans this is not an issue. However, if you do go over this amount, the tax liability packs a wallop.

And just exactly how big a wallop? Up to a cool 35%.

Gifting among family members is often under the table. However, make no mistake: this is not a gray area. The IRS requires you to keep tabs on your gifts – and to report these gifts – so it will know how much of your lifetime exclusion has been used up when you die. If the Internal Revenue Service catches you exceeding the annual amount, you will pay taxes, interest, and penalties.

Meanwhile, back to…

Sunday’s family. Not only are the two sons are supporting their mother with after-tax earnings, but over the past couple years they have found themselves having to watch the annual gift exclusion. This is a pricy fix – and one that has long-term implications.

For the average family, the biggest financial boon an aging parent can give an adult child is financial self-sufficiency. This increases the likelihood adult children will head into their own retirement with savings intact.

Life is long and getting longer. Medical costs are high and getting higher. And few people get 10 years down the road into retirement and find themselves financially better off.

Reverse mortgage is not a fit for everyone. But for many, not only is it a good option – it is an excellent option. It lifts the burden on the upcoming generation and allows seniors to live out their final years in dignity, comfort and independence.

If you are – or someone you know is – considering a reverse mortgage, give me a call. I always love hearing from you.

Laurie

Laurie MacNaughton [NMLS# 506562] · Reverse Mortgage Consultant · Middleburg Mortgage, a Division of Middleburg Bank ·  20937 Ashburn Road, Suite 115 · Ashburn, Virginia 20147 · 703-477-1183 Direct · LMacNaughton@MiddleburgBank.com · www.middleburgmortgage.com/lauriem

Life That Looks Like…Life

If I were to recreate a day’s conversations, only one or two would be noteworthy enough to recall in detail. That’s because most conversations are chit-chatty little dialogues of small consequence.

It just happened that one of yesterday’s last conversations was also the most noteworthy.

The background

My day started off with two back-to-back appointments, one with a retired husband-and-wife medical doctor team, and the other with a widowed construction worker. Both had saved for retirement, both have little credit card debt, both own their homes outright. Neither appears to have lived beyond their means – no cavernous homes, no high-end cars, no evidence of life lived loud.

However, there was evidence of…life. Life that got more expensive than anyone could have guessed. Life that contained trials no one could have planned for. Life that plain old looks like life. The husband of the medical doctor team said, “We saved enough to live to eighty. We didn’t bet on living this long.”

The retired construction worker buried his wife after she lost her years-long battle with cancer.

The conversation

Back to last night’s conversation. I was at a party and a colleague said to me, “Someday I would like to meet just one senior who did it right – who actually saved enough for retirement.”

I replied, “Someday I would like to meet just one person with a crystal ball.” We both laughed, and the conversation moved on to other topics.

The joke

There’s the old joke of the hiker who falls off a precipice, but catches a branch halfway down the cliff. As he’s hanging 100 feet in the air three rescuers come by, but the distressed hiker refuses aid. He says to each, “There will be a miracle: God will save me.” Eventually he falls to his death and goes to heaven.

He says to God, “Why didn’t you send a miracle? Why didn’t you save me?”

God’s reply?

“I sent you three Good Samaritans. What more of a miracle did you want?”

The reality

The reality of life is that it is filled with joys and sorrow, good and bad, the expected and that which could never be expected. No one can plan for every eventuality.

I meet a lot of people who are praying for a financial miracle. For many older homeowners, that miracle is reverse mortgage.

Financial soundness cannot cure all the issues associated with aging. But it can relieve the stress of lying awake nights worrying about money. Or what to do if the roof needs repair. Or the car needs new brakes. Or if any other one of life’s unexpected events strikes at a time when income is fixed, funds are limited, and options are few.

Reverse mortgage was never intended to be a replacement for a sound financial retirement plan. However, it can play an important role in augmenting what is already in place, and slow the burn-through rate on other resources.

If you are – or someone you know is – looking into the potential benefits of a reverse mortgage, give me a call. I always love hearing from you.

Laurie

Laurie Denker MacNaughton [NMLS# 506562] · Reverse Mortgage Consultant, President’s Club · Middleburg Mortgage, a Division of Middleburg Bank · 20937 Ashburn Road, Suite 115 ·Ashburn, Virginia 20147 · 703-477-1183 Direct · LMacNaughton@MiddleburgBank.com · www.middleburgmortgage.com/lauriem

Visit my Informational Blog at https://middleburgreverselady.wordpress.com/