Q. My parents knew it was time to downsize soon after my son (their grandson) Logan was born. They started to re-evaluate what’s important to them at this stage in life and decided that their health and family were more important than a larger home with a big backyard.
Recently, they started getting their two-story colonial in Burke ready to put on the market or rent and will be relocating to a much smaller home in Lake Anna, closer to where my family resides. My brothers are trying to convince them not to sell the place we grew up in, since they want to keep it in the family, but rather to rent it out.
While it’s wonderful that they are moving closer to us and downsizing, they have a lot of stuff. How do you determine what to keep, what to get rid of, and what to move? Are there any legal ramifications when seniors decide to downsize/transition to a smaller place? (i.e. children don’t want to sell the house.) Should they have an inventory of all valuables? A list of who gets what? Also, do people ever pre-plan for estate sales before they die? Perhaps they designate what they want to sell or what company to use?
Thanks so much for your help!
A. It’s wonderful that your parents will be moving closer to your family and will have the opportunity to spend more time with you and their grandchild!
Helping parents downsize from the long-time family home, whether they are moving into your house, a retirement home, or assisted living, means determining what to do with a whole lifetime of belongings.
Often, a senior is moving from a larger home where they’ve been for 25 to 50-plus years into a space that is half the size or less. And there is a huge accumulation of “stuff,” much more than they realize. Sorting through possessions is not only physical but also emotional, and it’s exhausting. It can be harder when an illness precipitates the move, but whatever the circumstances there are ways to make it easier.
To ensure that I answer all of your questions, I will break them up and answer them one by one. I would like to thank Matthew Quinn of Quinn’s Auction Galleries in Falls Church, who was very kind to provide expert guidance in helping me answer many of the questions below.
Q. How do you determine what to keep, what to get rid of, and what to move?
A. When it comes to getting rid of stuff, if it’s possible, start decluttering six months or even a year before the move. Shred old canceled checks and other unnecessary paperwork that are more than 5 years old. Donate clothes not being worn. Pare down or eliminate kitchen items if your parents are moving into a residence that serves meals. Make sure you and your siblings take your old sports trophies and school yearbooks home. Doing as much of this as possible ahead of time will make the move itself much easier.
What to Store or Keep
When it comes to what to keep, let your parent(s) lead the way. The nicer-looking, newer armchair might not be the one that’s a source of comfort. Did your mom collect teapots? Maybe she can take two or three favorites, and you photograph the rest and then present the photos to her in a special book.
Keep the family heirlooms or other special items, such as photo albums and cherished holiday decorations, that can’t go with your parent. If there isn’t room at the new place, make space in your home or garage or keep them in a small storage unit.
What to Move
Transition specialists say it’s common to try to move too much. Before you rent a big moving truck, use graph paper to make a floor plan of the new home, noting where the doors, windows, and appliances are, and figure out ahead of time what furniture will fit.
Transition specialists can also help determine what items have financial value, and auction or sell those items. Be sure to keep important financial documents (such as 5 years worth of bank statements, check registers, and tax returns) and important legal documents (wills, trusts, powers of attorney, advance medical directives) in one box. And pack important medical paperwork in another box. Make sure to pack important items your parents will need right away – medications, pajamas, toiletries, a change of clothes, fresh bedding – in a box marked “open first.”
Since the new home isn’t too far away, consider moving your parents and their essentials first, and then returning to their home to deal with the rest of their belongings. If there’s something they’re missing as they settle in, you can still take it to them. You can always sell it later, but once an item is sold at an auction house or estate sale, you can never get it back.
And be patient during the process. Helping your parents sort through their possessions can be difficult, but it’s also a great time to listen to them reminisce about memories, times, and people that were important to them, ideally while using the Legacy Stories app on your smartphone (which we provide as a free service) to have your parents dictate stories about important items, taking photographs of the item and using the app to create “audio photographs.”
Q. Are there any legal or financial ramifications when seniors decide to downsize/transition to a smaller place?
A. There are always significant financial and tax considerations when deciding whether to sell or rent a home, and often significant Medicaid considerations if the owner of the home is older and may have a need for nursing home care, or the equivalent level of in-home care, in the foreseeable future, so expert legal and financial and Elder Law advice is often essential. We provide this type of advice to our clients every day.
Children may not want their parent to sell the house for many of the above reasons, and we see some choose to rent the homes to help pay for ongoing expenses and then sell prior to losing primary residence tax status. Proper legal and financial and Medicaid planning is a must.
Proper legal planning of course includes a comprehensive living trust to avoid probate, along with a tangible personal property directive to dispose of important household items and personal possessions.
Q. Should seniors have an inventory of all valuables? Should there be a list of who gets what?
A. Having a list of valuables is always a good idea. Whether or not you intend to sell, keep, or give away, a proper inventory will help everyone in the future plan and find everything. An appraisal is not necessary here as values change often and, in most states, appraisals are not required even for items going through probate; but a list is always helpful. You probably only need to list items that have an estimated value of $500 or more or have significant sentimental value to a family member.
According to Quinn, “we always recommend that the assignment of property to family members or potential institutional giving be done prior to death.” Proper planning while doing estate planning can insure your desired outcome, and eliminate undue burden on family. If you plan to leave an item to a specific person, be sure to ask if the person actually wants the item. Quinn recounts a case where he had a client that inherited all kinds of household stuff she didn’t want, when in reality all she wanted was her family’s stock pot that she made pasta in with mom each year at the holidays. Sometimes the simplest things have the most value.
The same goes for charitable giving. Many charities don’t want to have to care for, insure, register, and keep items that may not be consistent with their mission. Asking a charity if they want the items is key.
Q. Do people pre-plan for estate sales before they die? Perhaps they designate what they want to sell or what company to use?
A. Rarely do people pre-plan for auctions or estate sales prior to death, but it could certainly be helpful in some situations, such as where someone has a collection of unique items that has a very limited market of other collectors. For most people, much more important than pre-planning for these small details is is to focus on yourself, enjoy the life that you have built, and know that there are professionals that can help your family when you’re gone.
Quinn also shares these other points to remember…
“Whether the owner is alive or dead, a vacant home is the most expensive storage unit you will ever have. Even a home without a mortgage in the Northern Virginia area will cost over $1,000 a month just in taxes, basic utilities, and insurance. We often see families fighting over a $2,000 object only to spend $15,000 in fees doing it. Time is of the essence when settling real estate . . . know the true costs!
When selling a family home, begin with the end in mind! Start with what you want to keep and what you want to give to family and friends, then deal with the salable, donation-worthy, and trash items in that order.
Most people don’t really know where the valuables are in their home. Trends and styles change and so does value. What was valuable when you were first setting up your home may have little or no value today. On the other hand, according to Quinn, “we find hidden treasures all the time where families don’t expect.” Professional help is usually not expensive, and often you can get free initial evaluations and consultations.”
Downsizing or Helping a Loved One Downsize? Make Sure Your Planning Documents are in Place!
We here at the Farr Law Firm have strategies in place to help all families plan for themselves and their loved ones. With advance planning, each person, regardless of their family situation, can retain the income and assets it has taken a lifetime to accumulate and the peace of mind that their child(ren)’s needs will be adequately and properly addressed. If you or members of you family have not done Incapacity Planning or Estate Planning, or if a loved one is beginning to need more care than you can handle, please contact us as soon as possible to make an appointment for a consultation:
Fairfax Estate Planning: 703-691-1888
Fredericksburg Estate Planning: 540-479-1435
Rockville Estate Planning: 301-519-8041
DC Estate Planning: 202-587-2797
About Evan H Farr, CELA, CAP
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