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Relatives do the dumbest things...
Old 12-09-2015, 04:39 PM   #1
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Relatives do the dumbest things...

My BIL retired from a union job last year after years of boasting how the union has taken care of him and he'll be set for life at 55 years old. He had been looking at homes on the Internet, hoping to find a good deal near a beach in Florida. Satisfied he could find something he's like, he decides to retire and promptly chooses to take half of his pension as a lump sum to pay for this house he wants to buy in Florida. After his shock at the high tax bill plus penalty he was hit with , he still goes down to Florida because of all the great deals he saw on the Internet. After a week of looking, he returns home in the grim realization that while you can get cheap houses in Florida, they need a lot of work and aren't in very nice areas. He realizes he can't afford to stay in his house in the northeast, so he rents it to his daughter just to pay the mortgage. Still not deterred about finding a place near the beach, he changes his focus on Delaware. He finds a triple wide that comes with a pontoon boat and a golf cart to roam around in. Afraid of someone else snatching away this great deal, he foregoes inspection and buys the triple wide directly from the owner that sits on a $780/month lot...owned by someone else. With the bulk of his lump sum distribution gone, and realizing this is still a stretch for him, he just knows his father and step mother will be happy to move in with them and contribute financially to help them out. He moves into the triple wide and within a week falls through the floor injuring his head and takes a trip to the ER. His father and step mother have no desire to move to Delaware after recently moving into a retirement home. After further inspection, the triple wide seller had arranged furniture to hide weaknesses in the floor and failed to mention that a small addition wasn't done up to code. The land owner is now threatening to have the triple wide condemned and force removal from his land. If he can convince the land owner to let him keep the triple wide where it is, it will take at least $10k to get it livable again. I feel sorry for my BIL, and more so for his wife, but all of this happened without any research or asking for advice from family. Some relatives do the dumbest things...
Any other good stories out there?
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Old 12-09-2015, 05:06 PM   #2
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nope, can't top that




hope he kept his dues up
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Old 12-09-2015, 05:07 PM   #3
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Wow! Can't top that one. I've just got a BIL who owns 12 Volvos and still has to borrow a car from friends when he drives 700 miles to DC to go to his dentist.
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Old 12-09-2015, 05:46 PM   #4
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I've never seen a $780 per month trailer park. Must be a really nice place. And whoever heard of someone moving all the way down to Delaware to retire--high tax state.

It's all a comedy of errors. Having a home paid for is the ace in the hole for someone retiring young. Or, their house should be mostly paid excluding cashing in deferred income (pensions.)
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Old 12-09-2015, 05:51 PM   #5
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Sorry to say but you can't fixed stupid, end of story.
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Old 12-09-2015, 05:55 PM   #6
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Originally Posted by Bamaman View Post
I've never seen a $780 per month trailer park. Must be a really nice place. And whoever heard of someone moving all the way down to Delaware to retire--high tax state.

It's all a comedy of errors. Having a home paid for is the ace in the hole for someone retiring young. Or, their house should be mostly paid excluding cashing in deferred income (pensions.)

I was surprised at the cost too. I am a little familiar with the trailer park from when I lived in that area about 20 years ago. It has a canal with access to the Delaware coast and a golf course with fees included. It was nice back then but can't speak for now.
Delaware has no sales tax and low property taxes, but the income tax can sting.


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Old 12-09-2015, 05:57 PM   #7
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Thank god for unions. Some folks would be broke and destitute without them.

Oh wait...

I've had the "don't cash out your 401k because you'll end up with just a fraction of it after penalties, state and fed taxes" conversation many times with my in-laws. So far I've talked them all off the ledge, and they are all on track to have a decent retirement at 66 or 67 (20 years from now) from what will be a five or low six figure 401k. Just have to keep reminding them that, yes, it is in fact a good idea to keep retirement assets in the retirement account.
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Old 12-09-2015, 09:24 PM   #8
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I am the dumbest of my relatives. I can hide it pretty well, but DW is beginning to catch on.

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Old 12-09-2015, 09:56 PM   #9
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He can always become a Hollywood scriptwriter... Dumb and Dumber 3.
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Old 12-09-2015, 11:38 PM   #10
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I cannot top that !

Although I was thinking about how DD went and asked a few relatives who are bad with money if she should buy an expensive SUV. Of course they said "Yes".
She didn't ask me as I think she would know the answer I would give.
She is still paying it off, and drives it on the weekends, lamenting about the high price of gas.
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Old 12-10-2015, 07:30 AM   #11
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Doesn't one of the genealogy websites offer an option where you can edit who you're related to?
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Old 12-10-2015, 07:52 AM   #12
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Doesn't top OP's story, but I have a distant friend who is currently living his retirement plan. In the interest of brevity, I'll just say that over the years we've had numerous personal finance discussions, and he's made innumerable colossally stupid decisions.
His last decision was buying a very nice home in a retirement community, except he couldn't afford it. So he took out a new 30 year mortgage. Sadly, his wife recently died and he sold the house, at a loss.
He's currently 68 years old. A whole back he told me his retirement funds will last him until he turns 72 or so, and maybe he'll die by then. He has 4 years to go, I guess. When he last called me, he was about to relocate to Florida to an apartment complex costing MORE per month than his current rent.
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Old 12-10-2015, 07:57 AM   #13
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Doesn't one of the genealogy websites offer an option where you can edit who you're related to?


He managed to grow his gene pool more than any of his siblings. One of his kids is doing well as a young nurse. Another followed in his union footsteps, but married a nurse and they're doing well. The third child, let's just say is struggling.


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Old 12-10-2015, 10:54 AM   #14
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I wonder if the "the union has taken care of him and he'll be set for life at 55 years old" mentality played a role in this? Not a union issue specifically, but just the idea that 'someone else' will take care of you, so you never learn how to fend for yourself, never learn even the basics. So you are helpless.

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Old 12-10-2015, 11:08 AM   #15
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My older brother got laid off at 61 and couldn't find another job so took early SS and decided to live on his $400K or so savings. Much of his money was in an offshore oil drilling company but since the dividends were so good, he put most of his other money into it too. We had a conversation a couple of months before oil crashed on whether it would not be better to diversify but he's an accountant and I'm just the dumb younger sister in index funds. He works in oil so he knows what he is doing! This is an guy who lost his first nest egg in Enron so you would think that he would learn his lesson to diversify. Now he can't afford his mortgage and has to sell his house. Wants to move to the Philippines.
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Old 12-10-2015, 11:08 AM   #16
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Originally Posted by ERD50 View Post
I wonder if the "the union has taken care of him and he'll be set for life at 55 years old" mentality played a role in this? Not a union issue specifically, but just the idea that 'someone else' will take care of you, so you never learn how to fend for yourself, never learn even the basics. So you are helpless.



-ERD50

I have no doubt that is the case. His father was a union guy as is his brother. The girls would have nothing to do with union jobs, even though one is a teacher and refused to join the teacher union. The girls have all done better financially. DW and I are paying for her dad's independent living home until their house sells.


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Old 12-11-2015, 01:41 PM   #17
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I can't think of any family members that have done anything that bad, but I know of one co-worker who blew it.

4 years ago he pulled his pension from MegaGovt just before age 50 when it gets locked in, and of course took a bit of a tax hit. At the time he was 6 years away from a monthly pension, while not large, would have been more than enough to live on comfortably with his wife who also will be receiving a govt. pension. One of the reasons he pulled his pension was that his wife was going to continue working and they'd have the salary and benefits.

6 months after he pulled his pension his wife caught him cheating and they divorced. They had a large mortgage on their house and neither one could afford to buy the other person out so it was sold and they split what little was left. After all the dust settled and all the debts were paid, he was left with about $200k from his pension, an 8-year old car, and monthly rent of $1000. At age 50. He's now 54 and that $200k is quickly running out and he's been working minimum wage jobs (he has no transferable skills from the govt. job). Had he stayed at work, he'd now be 2 years away from a monthly COLA pension and set for life.
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Old 12-11-2015, 02:07 PM   #18
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The story hasn't ended yet but we can see the train wreck coming. SIL is a Big Spender, likes expensive stuff, lots of restaurant meals, and pricey vacations. BIL has a six figure income (with overtime) working in a power plant. They have about zilch saved and are $300k or so in debt including mortgage. His job is very physical and while he's in good shape he's also mid fifties and beginning to feel it so an injury or illness could take him out of the job. He also works 12-hour shifts in rotating shift work - very bad for your health. The power plant is coal fired so that may well be closed in the foreseeable future. She's a waitress and makes $35k/year at best. She has not been without a car payment for the last 15 years that I know of.

She wants to retire to Sarasota, FL which I am given to understand is NOT a low COL area. He will have a small pension from 20 years in the Army National Guard but I don't know if he gets one from the power plant.

Somehow I just don't see this ending well for them.

I'll save the story about my stupid idiot moron nephew for later....
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Old 12-11-2015, 02:37 PM   #19
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I'll save the story about my stupid idiot moron nephew for later....
Its later!!! I'm ready for it!!!
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Old 12-11-2015, 02:44 PM   #20
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My BIL retired from a union job last year after years of boasting how the union has taken care of him and he'll be set for life at 55 years old. .........
It seems to me that the union delivered a good pension to him, the problem was that he took it as a lump sum and squandered it.
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