Dave Ramsey says: Here are some tips to take care of mom

Aug 22, 2023, 1:00 PM | Updated: 1:04 pm

older lady looking through book in a room...

(Pexels Photo)

(Pexels Photo)

Dear Dave,

My mother-in-law is 85, and she’s had some health setbacks recently. The family got together with her, and as a group, we decided it was time to sell her property and move her into an apartment at a nice senior living facility. She should see a little over $300,000 from the sale of her house. Aside from that, she has about $10,000 in a savings account. The problem is, she’ll only receive $2,100 a month in Social Security, and rent at the facility is $2,600 per month. Plus she loves making donations to charities. With interest rates where they are, is a CD ladder a good place to put the money to help her cash flow expenses in the future?

— Ed

Dear Ed,

If this were my mother-in-law, I’d want her to do better than a CD (certificate of deposit) ladder. Even with the deficit between her Social Security income and the cost of rent, she’ll only need to see $6,000 a year from the investment to make up the difference. And plus, she’s 85. Even if she got nothing in terms of interest, the chances of her burning all the way through her nest egg before she dies are almost zero. I know the thought of her passing away isn’t pleasant, but it’s something you have to take into consideration.

As far as the charities go? Right now, she’s the charity. Maybe not in the traditional sense of the word, but it’s time for mom to come first. Only the strong can help the weak. I didn’t let my toddlers carry our newborn. And when it comes to money, you’ve got to have the financial strength—the free and clear assets—to carry others. Take care of your own household first. That’s her responsibility at this point.

Ed, you’re not going to mess this up unless you put the money in crypto, or something stupid like that. If you want to do some high-yield savings as a part of it, that’s fine. If it were me, I’d probably end up investing some of it too. Here’s the thing: Overall, if you could make 8% on it, that’s $2,000 a month, and it lasts indefinitely. That’s not even touching the principal. But like I said before, even if you make nothing on it, just divide $6,000 into $300,000. See what I mean? It’s probably going to last as long as she does.

Of course, there may be some other medical bills, and you’d probably want her to have a life other than just paying bills. That’s why I’d like to see that extra $2,000 a month happening. It would provide a little cushion. And there may be a few other little things from time to time the family would have to pick up, but that’s not unusual in a situation like this.

You all can make this work for her. Don’t be super aggressive, but don’t be super conservative either.

— Dave

Dave Ramsey

dave ramsey gives advice regarding life insurance policies...

Dave Ramsey

Dave Ramsey says: Opt for the long-term plan, not the short-term fix

In this week's letter from Dave Ramsey, he gives advice to people who have elderly parents without life insurance policies.

3 days ago

woman with book on her head...

Jade Warshaw

Dave Ramsey says: Here’s a new kind of student loan forgiveness

Millions of Americans will be required in October to begin making payments on their student loan debt, but are they financially ready for the new reality?

5 days ago

windshield broke...

Dave Ramsey

Dave Ramsey says: Take the bigger check, it’s quick and easy

If your vehicle has been damaged and you're left with options to claim money to put toward another car, here's what's best.

10 days ago

little boy puts money into piggy bank...

Dave Ramsey

Dave Ramsey says: Make them workers and givers

As parents doing financially well, there's a few things you can do to prepare your children for long-term success: teach them how to work and give.

17 days ago

Man holds baby in loving manner...

Dave Ramsey

Dave Ramsey says: Life insurance is not a baby step

Life insurance is most definitely a necessity in your budget and something you need to put in place as soon as possible.

24 days ago

people gathered at a table for presumably a meeting...

Dave Ramsey

Dave Ramsey says: Revoke his get-out-of-jail-free card

Grace and mercy mean you love someone enough to approach them about their misbehavior, even if they are family and a part of your business.

1 month ago

Sponsored Articles

Home moving relocation in Arizona 2023...

BMS Moving

Tips for making your move in Arizona easier

If you're moving to a new home in Arizona, use this to-do list to alleviate some stress and ensure a smoother transition to your new home.


Mayo Clinic

Game on! Expert sports physicals focused on you

With tryouts quickly approaching, now is the time for parents to schedule physicals for their student-athlete. The Arizona Interscholastic Association requires that all student-athletes must have a physical exam completed before participating in team practices or competition.



At Ability360, every day is Independence Day

With 100 different programs and services, more than 1,500 non-medically based home care staff, a world-renowned Sports & Fitness Center and over 15,000 people with disabilities served annually, across all ages and demographics, Ability360 is a nationwide leader in the disability community.

Dave Ramsey says: Here are some tips to take care of mom