Question: My mother-in-law, who is in her mid-50s, just got a nursing degree and her first job as a medical professional. She has no savings, some minor credit card debt, and has, up until now, always lived paycheck to paycheck. What should be her priorities for getting onto good financial footing so that she doesn’t have to work for the rest of her life, and so that my wife and I don’t have to be the sole source of support for her once she retires? I’ve guided her towards establishing an emergency savings fund, paying off her debts, opening a Roth IRA, and starting up with her employer’s 401k. Does this sound right? What would you recommend? Thank you! Alex
Answer: You’ve given you mother-in-law good advice and covered the basics. Here are a couple of additional suggestions, or at least ideas to think about.
Education matters. Assuming that your mother-in-law’s health holds up, she’ll have to work longer than many of her peers. She should continue to invest in her profession, continually improving her nursing skills, and making herself a valued employee at work.
Her health is critical, too. Luck plays a role when it comes to health, especially as we age. But there is a lot we can do to improve the odds of living long and healthy. I would encourage to “invest” in staying healthy.
I would open up a conversation with her about living arrangements. Will she rent? Does it make more sense for her to buy, perhaps with you and your wife as equity investors in the home? What about an assisted living center or a continuous care community?
Last, keep doing what you’re doing. It’s important to maintain a low-key and ongoing discussion about finances between you and your wife and her mother. The three of you can figure out what needs to be done, but it’s much easier when the money conversations are a non-judgmental part of your relationship and conversation–instead of a subject that comes up in a crisis.
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