A change in plans

Due to the recent diagnosis of my father, one of the things I thought about was how to prepare my mother and myself financially. I've tried to the approach the subject of what happens to us "afterwards" but she really doesn't want to to talk about it. I completely understand, so I haven't pushed her about. However due to the reality of her very dire situation, it will have to be discussed, and fairly soon. Her own health isn't the greatest, and she faces losing her home. If she loses her home, she loses her income.

Personally, I've had to rethink a few things:

1. My health care fund ($1,500) will go to my mother. I let her know that if she needs it, she can have it. Said to hold on to it for now, so I will. I know she will need it at some point.

2. God forbid, if mom does lose the house, then I have to be prepared to move. She could move in with her sister. I will need to find someplace to rent. I've been checking out Craigslist to see what studio apartments are going for, checking rates for renters insurance, etc. Looking around and talking to friends, I am looking at about $700 to $725 a month for a studio. Hopefully that will include utilities and whatever extra for a pet.

3. With that in mind, I'm considering holding off on a computer purchase until January. I want to have as much cash on hand to stay flexible.

4. I'm going to see if I can draw up a budget to flesh out what kind of expenses I can expect if I were living on my own, then group all that into a new ING savings bucket called "Rent and expenses." It will help me gauge how it would financial feel to "pay out" that kind of money and if I can hack it.

5. I'm going to dial back my 2009 401k contribution. Right now I contribute 20%, scaling back to 15% could put an extra $2,000 in my paycheck. If I find a place for $700, that's almost 3 months of rent.

Bad news, and more bad news

1. My father was recently diagnosed with pancreatic cancer.

2. Neither of my parents have life insurance.

3. My parents owe $191k on their home from refinancing on it a couple times. Mainly due to medical bills from another terminal illness my father has.

4. My parents have enough money to cover their funerals. That's it.

5. My folks have been running a small in-home day care business together, so that's income, however it will be reduced once my father is no longer able to help, since mom will have to reduce the amount of children she can take care off.

The good news:

1. My parents have no credit card debt.

2. They have health insurance.

3. Dad collects social security, mom can start doing that next year.

It's bad enough to know that my father, after battling another illness for years, will eventually succumb to one of the most dreadful cancers one could have. Then to add the stress of what's going to happen to the home after that happens. She wants to do a reverse mortgage, would I believe would be the worst thing in the world. It may come down to declaring bankruptcy, however if she does that, where will she live? How would she create an income if she doesn't have a home to run the day care in? The amount of stress is unbearable. The only thing I can think of is to go over her budget with her and see if there's anything she can cut out, and hope that she can get by and the housing market improves sooner rather than later so she can sell. But honestly, I really don't know. I don't know what I don't know. I just feel lost and an intense sense of despair.

Random Thought

One of the justifications used for sky-high executive pay is that it's needed to attract the "best and brightest" talent. In case you haven't noticed, the "best and brightest" league helped lead the downward spiral of our current economic situation. Clearly, there seems to be a disconnect here.