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Old 03-23-2004, 08:39 AM   #1
 
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relatives

I am looking at retirement. I am 52 and my spouse doesn't work. We have no children. We have enough to cover our own needs with some, but not a lot, left over. Our problem is that we came from humble beginnings and our relatives live financially on the edge. There is a brother that goes from job to job, has no assets or savings, and often needs to be bailed out of trouble. Fortunately, this doesn't involve a lot of money. There is a sister that has a long time job, but it pays very little and she lives paycheck to paycheck. We are now having to help her with a divorce from an abusive husband. This is costing a lot of money because we likely will have to pay him his equity in their home as she does not have the ability to service a larger mortgage. The home isn't fancy. How do you budget for these things? Anyone have a creative ideas on how to deal with these disparities in a family? Or is it as simple as having to decide whether to work more years to support more people or be tougher on them. We did draw the line on bailing out nieces and nephews.

Maybe there are no answers, but anyone have similar experiences that you managed to muddle through?
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Re: relatives
Old 03-23-2004, 09:20 AM   #2
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Re: relatives

I have a couple of close relations who make little money, have been unable to learn how to save or invest, and are very generous with whatever money I give them. *Like you, I felt obligated to help them out, but I grew weary of hearing their tales of woe.

So, I gave one of them a credit card with a limit I felt comfortable with. * They use the card for emergencies (which apparently occur every couple of days), I get a record of how they spent the money (a fire-and-brimstone speech from me every few months seems to keep them in line), and I get the dubious bonus of receiving credit card perqs for my generosity.
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Re: relatives
Old 03-23-2004, 09:55 AM   #3
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Re: relatives

Our situtation is not too dissimilar to what you describe. Fortunately we haven't had to bail out any of our siblings yet, but it is always a possiblity due to questionable life choices some have made.

I think what you must to do whenever putting together a financial plan, be it for retirement or whatever, is to allow for some contingencies. i.e. You should have slack in your budget that, if all goes well, you can spend on yourselves for luxuries or extra travel, but if things don't go as planned, is still there to cover emergencies, such as bailing out ne'r do well relatives, dealing with health problems, natural disastors, or who knows what. If you don't have this kind of slack built into your budget, yes, you might want to reassess whether you are actually prepared to retire.

Once you have a contingency allowance in your plan, a prudent way to proceed might be to set aside your "emergency fund" for the first year after retirement, i.e., not spend any of it until the first year is over. That way you create a cash cushion to deal with any emergencies that may arise.

Another consideration in your situation would be not to advertise to your relatives that you are retired, as that could send a message that you have plenty of money to spare. (Certainly you do - compared to them! )

You've likely observed that people who get into certain kinds of difficulties often do so because they don't take responsiblity for themselves. They blame their problems on someone else or bad luck and think that the world owes them a living, because they have been so mistreated. And as the "lucky", "rich", retired brother, you would be the first person who "owes" them.

So it just might be wise to be less than completely honest, and tell them you are working part time, consulting, starting your own small business, etc. (Or, to be completely truthful, you could actually do one of these things. )

Hope this helps.
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Re: relatives
Old 03-23-2004, 10:48 AM   #4
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Re: relatives

That's a great question balat. As I am now starting to think more about long-term savings plans and goals it occurs to me that I may at least partially support my mother and/or father in 10 or 20 years. And I may soon become the most cash-rich of my relatives, so I may be the one to contribute if my Grandad has a sudden financial crisis. (At least my sister is doing well; my brother is 21 and doesn't have a foothold on a career yet. And Grandad seems to currently be the cash rich relative although I don't think he's set to retire.)

I don't have answers, but I parrot the question.

Granddad has worked hard all his life to provide for family; same with Mom. Mom could've managed her money better, but I can't really fault her for her choices; they mainly benefited us kids. Granddad has worked very hard his whole life and I think has done incredibly well with his background, although he's not rich by any strech of the imagination. Dad's the only one that flaked out, but I don't see myself letting him suffer if it comes to that.
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Re: relatives
Old 03-23-2004, 12:14 PM   #5
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Re: relatives

Give your relatives full emotional support, and only render financial support on the rare instance that it serves to prevent a disastrous situation, while concurrently assuring its a rarity or one time thing.

Give the brother all the emotional support he needs. Keep your money in your pocket and let him solve his own "small problems".

You may consider selling the sisters house, paying the husband his portion, investing the rest and moving her into an apartment or make a downpayment on an inexpensive home that she can afford on her own.

As far as parents and grandparents go, mine will have my full support emotionally AND financially at any time they need it. I expect one of the bedrooms in my home to become a destination to my parents at some time when they feel that independence is no longer in their best interests.

For those capable of taking care of themselves that are over the age of 21, they're on their own.

Best bet is to sit down with each of them, let your intentions and limits be known, and then stick with those going forward. Anyone in the family relationship with you for more than your wallet will understand, respect the decision, and will start paddling their own canoe. Anyone that doesnt respect the decision? Well, that question is easy to answer...
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Re: relatives
Old 03-23-2004, 01:45 PM   #6
 
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Re: relatives

Some observations from my life. Being older, no grandparents left to worry about and my wife's parents are deceased. However, my parents are living (86 and 83) and in relatively good shape. My wife and I joke that they may outlive us (a real possibility). Anyway,
my folks are not rich but quite comfortable. I have one brother (estranged) who is well off financially. My spouse
has done her duty vis-a-vis kids and sibs. All done
with that. My 3 kids (although raised with silver
spoons firmly in their mouths) are all doing fine.
Sooooooooo, what's my problem? Well, my folks
can't go on forever and I am the only child living nearby
with the time to help out. Also, my Dad loaned
me and my brother money over the years. I paid him back and my brother did not. An issue that will need to
be dealt with eventually. Personally, I would not loan my kids money, although I might just give it to them.
These are all issues that I never considered when I ERed.

John Galt
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Re: relatives
Old 03-23-2004, 02:52 PM   #7
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Re: relatives

My parents are both living, healthy, and approaching 80. Both my wife's parents are deceased. I watched my parents look out for their parents and I was very impressed by that. They did very well by their parents, and they deserve no less. So... I'm planning to move to the town where my parents live so that someone is close by and available just in case they need help. Plus, both my wife and I truly enjoy them and have missed living near family all these years. And if we live close to them, we'll see more of my siblings when they come to visit. The town has a lake, a college, a terrific park system, etc., and meets our needs in other respects. I see all this as a plus; it's one of the things I look forward to in ER.

If my kids ever have trouble, the door will always be open for them to recuperate, recover from financial disaster, or whatever. I haven't planned to fork over money and probably wouldn't do that. A warm bed, home-cooked meals, and moral support if it's ever needed. Perhaps a small amount of money, but it would have to come out of our annual draw and not at the cost of depleting the nest egg. They would understand that nobody wins if our financial ship sinks.
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Re: relatives
Old 03-23-2004, 05:46 PM   #8
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Re: relatives

Tuff luv approach that TH advocates sounds like a winner! If you have saved & sacrificed all your life while others, including adult siblings, have not prepared for stormy times, then they have made their own bed!
Don't let them die but throw them only a life preserver or a fishin pole & let them finally learn how to fish!
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Re: relatives
Old 03-23-2004, 05:46 PM   #9
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Re: relatives

Relatives ... hmmmmmm an overdue topic that can and often does affect retirement plans... My father died when I was young and my mother used his life insurance to pay for my college education. She remarried and when her second husband died, my wife and I invited her to move in with us. I am an only child and had no choice. My wife and mother got along wonderfully, thank goodness. My mother lived with us for 12 years before she passed away. We still miss her so much and speak of her most every day.
She received modest pensions and S.S. and contributed about 20% of the household expenses. Over the years she held a mutual fund or two and added what was left of her pensions to savings accounts. To my suprise, the miracle of compounding and such low living expenses created an estate that made allowed us to ER earlier and pay for my daughters education.
I have carefully invested the inheritance and it has doubled.

My daughter has used her education to shepard goats on a communal farm in North Carolina. She has been a member of that community for over two years now and rarely needs any help except for travel expenses to come visit us. Her time there during the worst of the recent recession somehow seemed a viable alternative to the unemployment stories of others her age in Austin... However, she now has a huge hole in any resume and shows no sign of returning to the working world of what some with her in N.C. call the 'death culture'. It seems that at some point her father will need to help out. But she is strong of character.
I do worry that she is now almost 29 years old and has no career path, let alone a financial plan.
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Re: relatives
Old 03-23-2004, 06:03 PM   #10
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Re: relatives

I would not tend to worry too much about 29 yr old , Rancher, as some tend not to follow the mainstream. Much talk on this forum about personality types INTP & INTJ who march to the beat of different drummers. Perhaps she is one. 15 years from now, she could be the proud owner of a huge goat ranch! Or have 3 kids & be a happy housewife!
But I am curious as to what she means by "death culture"?
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Re: relatives
Old 03-24-2004, 03:36 AM   #11
 
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Re: relatives

I too am curious about "death culture", although I
can guess being a cynical critical curmudgeon.

My son is pushing 40, never married and never held a long term job. He has wanderlust like his dad, but not
my workaholism. Right now he is back in college
working on his bachelors in forestry. After that it's anyone's guess. Some of his less adventurous
relatives ask "When will he settle down?" My guess
is never, but he's happy with his life. Everyone should be so lucky.

John Galt
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Re: relatives
Old 03-24-2004, 10:24 AM   #12
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Re: relatives

Rancher -

Good for your daughter. I've known a few goats, and they were better people than, well, some people I know.

I think the explanation for "death culture" is pretty self explanatory and not too cynical.

We get up in the morning before we're rested, jam bad food into ourselves to accommodate "the schedule", impose pointless deadlines that create stress, fight "political" situations that exist solely to fill someones ego, and recuse ourselves from enough association with friends and family. All this to feed the advertised lifestyle that forces us to aspire to be even higher consumptives. Then we go to therapy and eat lots of pills to help us sleep, wake up, feel better about ourselves, and combat illnesses that this unhealthy lifestyle induces.

Sounds pretty darn much like a "death culture" to me.
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Re: relatives
Old 03-24-2004, 05:56 PM   #13
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Re: relatives

Hmm; if TH's description of "death culture" is correct, then, years ago when I was about that young ladies age, I felt the same as she did! This is actually my 2nd ER! First was at the tender age of 26, I told them to take this nice white collar job & shuv it! Walked out giving 2 wk notice, did some soul searching, survived on savings of $12k(big bux back in 70's), periods of travel & no jobs, some part time jobs, some social work.
Oddly enough, there was much good that came from this 10 yr rebellion to "death culture". Within 2 years, gave up smoking, drinking, & womanizing, & found some real common sense morals.
In reality, it's possible that 29 yr old followed in my footsteps. I didn't go to a goat farm but pretty close & probably more secluded when I purchased a desolate 33 acre plot of land & did my mother earth "back to the land" thing for 2 yrs. Turned out to be a great experience & sometimes still yearn to go back to those simple days of building log cabins, out houses, gardening, & good ole mother nature!
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Re: relatives
Old 03-24-2004, 07:41 PM   #14
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Re: relatives

Jamesgang, you and TH have correctly identified the communes use of 'death culture'. They combine that with a loose philosophy they call ecolibrium. Not base on religion, or leftist politics .. drug and smoke free. They have been an entity for over 30 years now beginning in California (where else?) moving to New Mexico, then Texas, now North Carolina. They use the gains from each farm as leverage for the next. As best I can figure out it is basically a place to drop out for awhile. Some have stayed a long time however.

I figure some members here would be able to identify with an alternative means to leave the rat race, 'death culture'. The farm attempts to sustain itself with agriculture, crafts, and music fairs. They even face some of the problems we do like medical coverage, and withdrawal rate of funds. They are not completely self-sufficient and send members to music or cultural events to 'sell' broushures and CDs.

My daughter is on her way to visit as I write this. I am not sure this involvement is but a phase or if she has some vision of her own future.

At one level, I feel this situation is some sort of cosmic payback for my indiscretions of the '60s.... hmmmmmmmm
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Re: relatives
Old 03-24-2004, 08:22 PM   #15
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Re: relatives

I guess what it boils down to: if she's happy, then its all good. Yes?
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Re: relatives
Old 03-24-2004, 08:49 PM   #16
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Re: relatives

Quote:
I figure some members here would be able to identify with an alternative means to leave the rat race
You know, I think you may be on to something here. An Early Retirement commune. I can see the ads now....

Leave the rat race behind! Bring your nest egg and come roost with us ... at the Frugal Farm! Join your host, Ol Rancher, on a tour of the decompression chamber, the fishin' hole, and the safe withdrawal room....
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Re: relatives
Old 03-25-2004, 04:21 AM   #17
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Re: relatives

In !953 R.A. Long (Longbell) sold the 'world's largest lumbercamp' to Rwtirement Estates Inc. I remember the ads when I was a kid. The commune flavor has died off over the the decades.
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Re: relatives
Old 03-25-2004, 05:12 AM   #18
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Perhaps, Rancher, my family's reaction to my "soul searching" back in 70's could be of assistance. Mom & Dad were extremely unhappy with my decision to give up career & then do the "mother earth" thing within a few years. As I look back, no amount of arguing on their part would have changed my thinking. In sadness, they merely watched their "black sheep" son go off the "deep end"!

What they did may have actually hasened my return to civilization, but this is an unknowable. They actually came down to visit my "homestead" about twice a year(a 400 mi. drive), spent weekends under primitive conditions of no electricity & running water, & even helped with choirs.

Willfullness & defiance is a funny thing & I believe our educa. system, even back as far as the 50's, plays a major contributory role in setting up many sensitive youngsters to have to "thrash about" in an effort to recover their lost "spirit" that was "broken" in the same way that wild horses are broken of their spirit.

Have you visited her commune? Has she invited you? My suggestion is to express a sincere desire to understand her. That may not bring her back tomorrow, but communication often gets one to "reflect" in a non-defensive manner if it is perceived as genuine. & perhaps, if she is happy & healthy, this is where she belongs. If not, these things must just run their course. Somehow, I suspect my folks knew that.
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Re: relatives
Old 03-25-2004, 06:11 AM   #19
 
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Re: relatives

Hey jamesgang! With my son, I just let him go. If he
was happy so was I. Nice of your folks to help with "choirs". I guess with no electricity, singing must
have provided good entertainment.

John Galt
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Re: relatives
Old 03-25-2004, 08:03 AM   #20
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Re: relatives

No singing! For entertainment, as I recall, if we were not too tired after the days work, we'd go fishin or build a campfire & cook our catch.
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