Life and Money With Helaine

Dear Helaine: During the recession, I lost a great, well-paying job. I lived off my savings for a time and took a series of short-term, not-well-paying gigs before training for a new field. I was offered a very good job in the Middle East. It pays well, with free housing, no bills, summers off and frequent breaks.

I am now 66. I could stay on this job for three more years before mandatory retirement. The problem is, I hate living here! I miss trees, greenery, culture, spring, fall and, most of all, my friends. The issue? I have about $300,000 in savings and an $800-a-month pension, and if I file tomorrow, $2,000 a month in Social Security. It's probably not enough money, not if I live into my late 80s or early 90s. I've always rented, so there is no home waiting for me in the states.

I know I should stay at this job and sock away more money. If I come back, I think I can land some poorly paid seasonal work, maybe adding an extra $15,000. But I want to come home! I am aware I won't be healthy and vigorous forever. I want to start living in a place where I am happy sooner rather than later. I could live in a modest apartment. What should I do? -- In Misery in the Middle East

Dear Misery in the Middle East: When I was younger, I never could understand how and why people retired. Surely, they could put in one more year, right? Or two more years? Or three? But now I am a little bit older, and I totally hear what you are saying. Life can feel like it is slipping away while we are doing things we believe we should do but that make us unhappy.

My advice to you: I would sit down and make a realistic budget of what you believe you would spend monthly back in the states. I would then work out how much you will have -- from Social Security, from your pension, from a spend down of your assets, and from the possibility of part-time work. See if it is doable.

If you think the numbers add up to future trouble, don't think about three years. Think about six months. Or maybe even three months. During that period, save aggressively, then reassess. You might find it's easier to hold on for, say, another year, if you think about it in small chunks, rather than a long three-year period.

(To ask Helaine a question, email her at askhelaine@gmail.com.)

(EDITORS: For editorial questions, please contact Sue Roush at sroush@amuniversal.com)

Dear Helaine: I own a single-family home in the Silicon Valley. There's about $1 million equity in it and an annual property tax of $2,000 (thanks to Proposition 13, which limits annual tax increases).

I no longer live in the area. I advised my adult children that they could live in the house by building a second story and renting out the first floor, much as I am doing now. (I'm currently receiving about $6,000 from a tenant.) That way, they could build the second story with some of the equity that's in the house, and their mortgage payments would be covered by the rent.

But the kids seem to think it would be better to sell off the home and pay off their student loans, and with the remaining amount, purchase another home in the Silicon Valley. The issue: Their property taxes would likely be -- based on what they say they are looking for -- about $25,000 annually.

I am old school. I think they would gain additional value by adding the second story, and they could pay off their student loans with their lower cost of living because the mortgage and property tax would be much less. Please advise! -- Hoping to Help

Dear Hoping to Help: You've made your children an extraordinarily generous offer. Instead of being grateful, your children are quibbling over the terms of the deal. So let me spell this out: We are not obliged to give our children down payments for homes, or aid and abet them in financial decisions we consider shortsighted. In this case, the home is your home. At the same time, your children are not obliged to take you up on the offer you've made, either. They could continue to rent elsewhere, or save up their own down payment (something I would imagine is rather hard to do in Silicon Valley).

So I am going to ask you: What do you want to do? Why do you want to give them this home? Are you sure doing so won't jeopardize your own finances? You could, after all, continue to rent out the home and keep it in reserve should your children change their minds, or if you decide to return to this rather expensive part of the country.

Or are you tired of being a long-distance landlord? In that case, you could sell the home and, again, if you wish, give some of the proceeds to your children for their future, or simply invest the money. What I wouldn't do? Take an action you vehemently don't want to do because your kids happen to wish it.

(To ask Helaine a question, email her at askhelaine@gmail.com.)

(EDITORS: For editorial questions, please contact Sue Roush at sroush@amuniversal.com)

Dear Helaine: I want to know what to do with my small but steadily increasing savings. I'm one year into a new career after staying home with a small child while grinding away at school. My husband supported us so we could (painfully) survive on just his income. He grew up middle class, so he graduated with no student loans and $200,000 from a trust he won't touch. He works a union job that pays OK and has a good pension plan.

We owe $200,000 on our home (we live in a pricey area) and $60,000 in student loans for my education. I made big money mistakes before I married, so I came into the marriage with no savings, no marketable skills and $20,000 in debt. Since I've started working, I've paid off all our credit cards, splurged on a few items, visited family and made donations to my favorite charities. I've also put about 20% of my paycheck into our joint account monthly.

I largely subscribe to the "what's his is ours and what's mine is mine" philosophy because I think I am at high risk of falling back into poverty should anything bad happen to me/us. Is this fair or insane? What should I do with the $20,000 I've saved so far? And should I sign up for my workplace retirement account? -- Now Richer, Not Poorer

Dear Now Richer, Not Poorer: It sounds like you feel your spouse is more financially advantaged than you since he comes from a more monied family and enjoyed benefits from that. But you need to remember you got something from that, too. He supported your family when you went back to school, and he doesn't seem all that concerned about how much money you are now putting into your joint accounts and how much you are reserving for your own use.

Here's where I would start: You and your husband need to sit down and talk all this over. That's really your first order of business. It sounds like both of your habits are good, but you'll do better in the short and long term if you are on the same page with your finances: How much should both of you put in separate accounts? What about the joint one? Do you feel any urge to further merge your finances?

There are no right or wrong answers here -- it's up to you and your spouse. But do it together, not solo. At the same time, you most certainly should sign up for your workplace retirement plan. It will not only give you your own individual savings, it will also allow you to put money aside for your future in a tax-advantaged way.

As for the $20,000, it sounds like a great emergency fund.

(To ask Helaine a question, email her at askhelaine@gmail.com.)

(EDITORS: For editorial questions, please contact Sue Roush at sroush@amuniversal.com)