Currently 25 y/o making 70k/year in Boston. I grew up pretty poor and I have minimal financial education. A lot of my salary now goes towards helping my parents get out of debt. My parents are no longer able to live on their own, so considering selling my grandmas house where they live (maybe 550k), paying off their mortgage (100k) and buying a duplex (between them they make about 55k/year). Is buying a two family home a good investment ? How much can I afford to spend on a new house?

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Very impressed that while you are already focused on saving and FI, you are prioritizing your family. Keep educating yourself on financial issues and seeking guidance from trustworthy sources. Great job! I hope you find an amazing place that will provide for you and your parents! 💛

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Thank you ❤️❤️

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2 family homes are great investments if you’re renting it out at the right price. Are you planning on having your parents be the tenants on one side and yourself on the other? If so, how would they pay you?

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I would be moving into one side of the duplex and they would be in the other and we would split any mortgage payments… (so not renting to a third party )

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Where were you looking to buy? Even with your income and your parents, total income is pretty light for a duplex in the Boston area.

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Greater Boston would be fine, it doesn’t need to be in the city

I keep thinking about their debt and how to separate yourself from it legally. Like don't cosign anything with them.
Maybe it's possible to keep regular payments going but not payoff debt if it's low interest but will not pass to you when they die?

Are you intending to use house sale proceeds to pay off the debt? Wondering if it would make sense to funnel profit into long term care. Or is the plan to allow that to fall to Medicare to pay for?

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Got it, OP, thanks.

Re. debt, it doesn't pass to you unless your name is on it, as already said - so don't put your name on any of it!

Additionally, things like life insurance and retirement accounts pass directly and not touchable by creditors after the owners pass.

Re. No Nursing homes: great! But you should plan for $ to help with in-home care, which could become too much for you to handle ‐ especially near the end.

So, I'm wondering if it makes sense to do something like this:
Put portion of home sale profit $ into their life insurance or retirement account (especially Roth), thereby protecting it from creditors. Then pay for in-home care out of pocket.
Then reimburse yourself years later.
This way they would be helping pay for the in-home care (eventually) without allowing creditors to eat away at that.

Not sure if these are the right moves, but trying to think creatively about how to reduce your (admirable) burden.

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Can you move in with them? Do they need care? Are you considering moving them to a care facility?

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Medicare would pay for the facility but only if medically necessary. It's based on your parents assets. You need to speak with a financial planner who specializes in elder care to understand the ramifications of selling their house.

Thank you all! To clarify, I would be moving into one side of the duplex and they would be in the other and we would split any mortgage payments… (so not renting to a third party )

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As a complete side note: check out Dave Ramsey if you haven't already. I don't agree with everything he says, but once I started doing the baby steps he talks about my money mindset was tremendously improved! He has a daily podcast that's on YouTube and wherever you listen to podcasts. And a book called Total Money Makeover.

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