Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 07-08-2014, 10:09 PM   #61
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
REWahoo's Avatar
 
Join Date: Jun 2002
Location: Texas Hill Country
Posts: 42,094
We all need more sunshine in our lives. Wait...except those of us who already have too darn much.
__________________

__________________
Numbers is hard

When I hit 70, it hit back

Retired in 2005 at age 58, no pension
REWahoo is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 07-09-2014, 08:18 AM   #62
Full time employment: Posting here.
Golden sunsets's Avatar
 
Join Date: Jun 2013
Posts: 734
Quote:
Originally Posted by JRM1510 View Post
Hey everyone. This doesn't exactly fit the topic of this forum but I was looking for something for Dave Ramsey's style, but the only forums there you had to pay for. I googled Financial Independence Forum and found this, so I went with it.

Dave Ramsey addresses some stuff like this but nothing exactly that I saw. I'm 23 years old, I'm doing pretty well, good job, saving a good amount, no financial dependence on my parents for anything, all that. I'm working towards retiring early. My sister is 21, she's still in school so my parents are mostly supporting her. She has a part time job but only $14/hr for 10-12 hours a week. She's not incredibly wasteful (by normal standards) but she's not frugal either. What most concerns me is what my parents pay for her. Now, this is really their business, not mine, but I can't help but worry that it's unsustainable and will be ongoing. My parents are both retired, and have a networth of just slightly over 1M, most of that is in home equity. They own their home and 2 cars outright, but they only have about 400K-500Kish in financial assets, and they're spending it quick. They recently bought my sister a $27,000 car and a $69,000 condo in town. I don't know what her expenses are exactly but I expect something like $2000 a month, and that's without rent/mortgage or tuition. I'm worried that they are seriously depleting their savings quick. I don't think my sister will be able to maintain what life style she has once she graduates, she goes to a local state school (which is fine, I went to the same school and got a good job before I graduated) but she's majoring in psychology and isn't doing well at that even (not failing, but mostly Bs and Cs - I asked and she said her GPA was 2.8 or so), so I am worried it will be hard for to find professional work. Even if her part time job turned full time, that's still only $2240 a month, and after taxes more like $1600. And I am skeptical she'll even get that, it sounds like that business isn't doing well. To clarify, she's not a bad person or anything, she just doesn't watch money or think about her future at all.

I'm worried that my parents will either deplete their savings too quick trying to finance her and will go broke, or will cut her off and she'll just pile on debt until nothing can be done. I've been trying to talk to her about school (trying to get her to major in something more profitable instead, she just finished sophomore year so it's not too late), or about just making sure she does better so she's in the best position of all psychology graduates. She always says she's gonna get straight As next semester, and next semester is always the same, a couple Bs and a couple Cs. I tried talking to her about her spending yesterday for the first time, but she doesn't even know what she spends. Also, it's hard for me to do much since I don't live in town any more (my job is about 800 miles away from my hometown, I'm planning on going back for Thanksgiving), so it's harder for me to help from here. I tried asking my parents what they thought and they basically said it's not my business (which they're right, but I'm just worried about them).

I'm wondering what advice you guys have. Should I try to do anything? If so what can I do?
To the OP; I don't understand your parents financial situation. They are retired, with no pension, Only in their 50's, $400,000 to $500,000 in savings, SS years away and annual expenses of $70,000 per year? With those assets they should be spending no more than $12,000 to $15,000 per year using a SWR of 3 percent. Even if they sold their home and rented, increasing their portfolio to $1,000,000, using a SWR of 3 to 3.5 percent doesn't begin to meet their expenses not to mention purchasing a condo and car for your DS. I guess I wonder how they thought they could retire.

Are they looking to SS to eventually meet their spending needs?
__________________

__________________
Golden sunsets is offline   Reply With Quote
Old 07-11-2014, 09:37 AM   #63
Recycles dryer sheets
 
Join Date: Mar 2012
Posts: 125
To the OP
I agree that there is little you can do to curb your parents' spending and support of your sister.

Are you worried that they will run out of money then look to you for support?
If that is your concern it might help to realize that low income seniors have some resources: you can check for low income senior housing (either in your location or in theirs). Once they are 65 they will qualify for Medicare or if poor enough, for Medicaid. I'd focus my energy on learning what resources (other than yourself) will be available to them. Our county has a senior resources office and they publish an annual booklet of useful information.

Other than that, as difficult as it may be, you need to let go and look after yourself.


Sent from my iPad using Early Retirement Forum
__________________
dmdunca44 is offline   Reply With Quote
Old 07-12-2014, 07:35 AM   #64
Thinks s/he gets paid by the post
gauss's Avatar
 
Join Date: Aug 2011
Posts: 1,708
Quote:
Originally Posted by JRM1510 View Post

I'm not as worried about my sister's spending as her potential income. She spends a lot, but not incredibly outrageous. With a decent income she's not going to retire young but she's not going to be super indebted either. ...
Have you talked to your sister about the huge benefits of getting an internship or co-op job in her field of study now during summers? This worked wonders for me coming up through the system. Having the job experience under her belt when it comes time for the interviews for permanent positions could be priceless.
__________________
gauss is offline   Reply With Quote
Old 07-12-2014, 05:31 PM   #65
Recycles dryer sheets
 
Join Date: Sep 2006
Location: clearwater
Posts: 223
It sounds like your parents will have a big problem. Hopefully your dad is willing and able to go back to work .


Your sister sounds perfectly normal ie: average to me. It is not her fault if your parents are too generous.
What is she majoring in? Her grades are fine. Her income is fine for part time income of a student. What makes you think she won't be self supporting after she graduates?
__________________
rothlev is offline   Reply With Quote
Old 11-17-2014, 07:36 AM   #66
Recycles dryer sheets
cooch96's Avatar
 
Join Date: May 2014
Location: Lakewood
Posts: 442
This isn't advice but it is related. My DF called yesterday sobbing, asking me to "save his life." He wanted me to give him a $25k line of credit so he can keep chasing his dreams (which are currently Dallas real estate and Honduran rain forest management). This will not happen; I have a wife to support and will not let him drag us into his fantasies further. I promised him a few hundred and some more for Xmas. I also told him to apply for SS, since he turned 62 this year.

After reading this thread, I'm more convinced that tough love is correct and still counts as love. I'm just not sure where to stop. I want to help, he did his best to raise me, he loved me and I love him, but is giving money helping? How many strings do I attach to my support? I'm going to have to have some long conversations with him. This is emotionally exhausting.
__________________
Why be normal when you can be yourself?
cooch96 is offline   Reply With Quote
Old 11-17-2014, 09:20 AM   #67
Recycles dryer sheets
 
Join Date: Dec 2011
Location: Chicago area
Posts: 427
Quote:
Originally Posted by cooch96 View Post
I want to help, he did his best to raise me, he loved me and I love him, but is giving money helping? How many strings do I attach to my support? I'm going to have to have some long conversations with him. This is emotionally exhausting.
I would not attach any strings to money given to family. If you want to give them money, make it clear it is a gift and there is no repayment desired. Otherwise it could cause serious resentments from either side into the future.

I don't think there is a universal right or wrong answer as to whether or not to give money to family. Each family and situation is different. Just don't loan!
__________________
AnIntentionalRoad is offline   Reply With Quote
Old 11-17-2014, 12:08 PM   #68
Full time employment: Posting here.
 
Join Date: Jul 2014
Posts: 616
To the OP, as sad as it sounds, you don't have any control over your parents or sister and can't get them to act in a way you think best (even if it is the best). I wouldn't worry about your sister, she's young and she may not really get motivated to work hard and get extra jobs until she realizes she needs the money. Supporting her will only encourage her to keep up her above her means lifestyle.

For your parents, could you encourage them to go to a fee based financial planner to develop a plan for their retirement finances? If you want to help them maybe you could offer to pay for a consultation. I wouldn't discuss this in the context of your sister taking advantage of their financial resources, but more of an overall "You need to have a plan for your future" - your Dad seems to at least be concerned about the issue. Maybe hearing the hard truth from a third party would be easier than hearing it from you and they may be more likely to accept a "professional's" advice.
__________________
Katiek is offline   Reply With Quote
Old 11-17-2014, 12:33 PM   #69
Thinks s/he gets paid by the post
 
Join Date: Feb 2014
Posts: 1,471
I think your response to your DF was on the money. Since he asks you to "give him a $25K line of credit" he is asking you for an open ended loan. You are not your parents' bank. If you give him the money for pipe dreams, it's guaranteed you'll never see it again. If he went to a bank for a loan or a line of credit, they would look at all his finances, his credit score, his tax return for the last 2 years, as they well should. And if a loan is for business purposes, the bank would also want to see a business plan.

If you feel compelled to support him, treat it as a business transaction and do everything a bank would do--look at his 1040s, check his credit rating (he can check his own while you watch), and ask for a business plan. If he has no business plan, you would be throwing money away to lend him any money.

If you "give" more than $14K, it will be subjected to a gift tax. If you loan him money, do it by the book, collect interest and expect regular monthly payments.

If he is uncomfortable with sharing his finances with you as you are with the idea of a line of credit, he may decide to give up on the idea.

Katiek's suggestion of a fee based financial planner is excellent.
__________________
EastWest Gal is offline   Reply With Quote
Old 11-17-2014, 12:57 PM   #70
Thinks s/he gets paid by the post
 
Join Date: Feb 2014
Posts: 1,049
My advice, stay out of everyone's business.

What do you care if they crash and burn? When they come to you for money simply ignore them. Problems solved.
__________________
jim584672 is offline   Reply With Quote
Old 11-17-2014, 02:15 PM   #71
Recycles dryer sheets
Taxman59's Avatar
 
Join Date: Sep 2014
Posts: 484
Quote:
Originally Posted by AnIntentionalRoad View Post
I would not attach any strings to money given to family. If you want to give them money, make it clear it is a gift and there is no repayment desired. Otherwise it could cause serious resentments from either side into the future.

I don't think there is a universal right or wrong answer as to whether or not to give money to family. Each family and situation is different. Just don't loan!
I have a sister that was a magistrate. She was considered the expert (she wrote a book on her specialty). She was terminated do to politics, so now she is unemployed. Long ago, she helped me before I had a job, so I turned around and helped her. I, however, put a cap on the assistance as well as referred to the $$ as a gift. I never expect to see the money again, and if I do, then it will be a bonus trip for the DW and me (maybe include my sons as well!). If you make a gift, be sure to be clear to your sister that it is a one time gift.
Good luck, it can be gut wrenching to put a family member through the tough love program.
__________________
Taxman59 is offline   Reply With Quote
Old 11-17-2014, 03:15 PM   #72
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
travelover's Avatar
 
Join Date: Mar 2007
Posts: 9,880
From the OP's profile:

Last Activity: 08-14-2014 12:35 PM
__________________
Yes, I have achieved work / life balance.
travelover is offline   Reply With Quote
Old 11-23-2014, 12:15 PM   #73
Recycles dryer sheets
racy's Avatar
 
Join Date: May 2007
Posts: 481
Quote:
Originally Posted by Walt34 View Post
You can't save them all.

You might try showing them the numbers on how this is all going to pan out, but based on your descriptions of their personalities and reactions I doubt it will have any effect.

You are right. Your parents will be broke very soon if they keep this up. Your sister may very well sink into a lifetime of servitude to the credit industry.

Save yourself.
+1
__________________

__________________
The Big Lebowski: Are you employed, sir?
The Dude: Employed?
racy is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
A question from my sister Nuiloa Other topics 16 08-24-2011 12:10 PM
Anna Nicole Smith has a sister? REWahoo Other topics 5 05-14-2007 06:25 PM
Help for my sister scubamonkey Young Dreamers 55 11-30-2006 10:36 PM
Same wife's sister, different problem Elderdude FIRE and Money 35 10-08-2006 02:54 PM
How do YOU plan to ER? -sister topic to "How Did You RE?" on the FIRE section.. mangodance Young Dreamers 11 07-06-2005 05:44 PM

 

 
All times are GMT -6. The time now is 12:33 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.