Boomers preventing their own retirement?

[Rich_by_the_Bay]

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Originally Posted by youbet Isn't it strange how parents who, for whatever reason, don't do a good job raising their kids get lots and lots of notice and you seldom here a word about effective parents?

Amen.

[Darryl]

Kid's are free. I'm sure my retirement date will be earlier because we have them.

Income is higher than it would have been and lifestyle is simpler (less extravagant/wasteful) than it was before them.

As far as ongoing support I'll get them through four years of college just like my folks did for me and then I will wish them luck in their future endeavors just like my folks did for me.

They will get whatever we leave behind but I don't believe the subsidies and gifting for estate planning are good for the receiver.

[Billy]

Soon to retire

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We've found that taking care of grown kids is not an issue at all, they are quite independent. The real issue is taking care of aging parents.

I think they are both ‘issues’ - just on a different end of the spectrum. Both of my parents died when they were reasonably young. I would hesitate to say that was a benefit… however I understand your point.

Rwood

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Proud Vietnam Veteran: Cu Chi 66,

Thank you, Rwood for serving our nation. Billy and I went to see the Cu Chi tunnels on a tour in 2005... (CU CHI TUNNELS ) ohmigod.
I have deep respect for you.

Goonie
Perfect. More parents would benefit by utilizing that same approach.

Rich in Tampa

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I share your empathy for those who regret any major financial decision because it caused things not to work out for them in the end. Kids, investments, too big a house, a bad dot.com, whatever. And as for those who continue the pattern long after it is clearly destructive, well, it is sad.

It is sad. I just made a Skype call to the States (from Thailand) this morning and spoke with a friend. A mutual friend of ours (mid 60’s) is working to put her 3 grandkids through private schools, and has her own 38 year old daughter still living at home with her… It wouldn’t be so bad, except that our mutual friend feels the ‘weight of the world on her shoulders’ because of this…

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Funny thing about kids, though. I'd do it again in a heartbeat even if it prevented me from every retiring until the day I died. Folks either understand that or they don't. Hard to describe.

I see your point, and I would like to add that there are many reasons people don’t have children. For some it’s not simply a matter of choice. It could stem from having been abused or neglected themselves when they were children, and they don’t want to repeat that pattern, or it could be a physical problem.

People are not better or worse human beings for having or not having kids… and the reasons are not always monetary.

Want2Retire

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One of the greatest gifts we can give our children is the pride and self confidence that comes from supporting oneself and steering one's own course into the future.

Amen!

DblDoc

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One of our incentives in LBYM and early retirement planning is to instill those values into our son as he grows up. IE not to fall into the trap of continuous, extravagant consumerism financed by debt which we are surrounded by where we live.

Again, in my opinion, Excellent!

Nords
Your comments are right on the money there! I couldn’t have said it better.

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Originally Posted by Billy Since we are childless, many times our insights, advice or experiences are not taken seriously.

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No problem, send 'em to me. (Seriously.) I'll turn them over to our almost-15-year-old and she'll straighten them out in a couple weeks. Well, that option's available along with other more serious advice.

You’re on, Nords! I’ll do it! I have utilized you as an example in some of my replies, but perhaps I will simply forward the emails on to you to begin with! Straight from the horse’s mouth is much better.

Be well,

Akaisha
Author, The Adventurer's Guide to Early Retirement

[Milton]

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Originally Posted by bssc I have at least one friend who is paying for her 25 year old daughter's credit card bills. I have asked her why she does this and she says I would not understand because I don't have kids.

I have had similar conversations.

Personally, I don't mind if people want to spoil their 'adult' offspring ... after all, I spend a (small portion of) my income on a hobby that many would consider an unnecessary indulgence. But it is extremely frustrating to hear them whinge about having to do pay for everything, especially when they respond to obvious suggestions that they simply stop with the old "you don't understand because you're not a parent" non-answer.

[W2R]

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Originally Posted by Milton I have had similar conversations. Personally, I don't mind if people want to spoil their 'adult' offspring ... after all, I spend a (small portion of) my income on a hobby that many would consider an unnecessary indulgence. But it is extremely frustrating to hear them whinge about having to do pay for everything, especially when they respond to obvious suggestions that they simply stop with the old "you don't understand because you're not a parent" non-answer.

I don't understand (why someone would pay their 25-year-old's credit card bills), and I AM a parent!

It is tough to be a good parent and one of the toughest things is to let the baby bird spread his/her wings and fly. Sure, I have shed my share of tears over that, as have many mothers. But in order to be a good parent, we have to let go.

[Dog]

DH and I allowed our daughter and a roommate to move back home for one year. She rented the downstairs finished daylight basement for $500 a month. The agreement was one year so she could save some money. I'm not sure she saved any money, but she did find a better paying job and got her life a bit more organized. When the second year rolled around we told her we were raising the rent - needless to say they moved out. What we found more interesting were the comments from co-workers and friends. They thought we were heartless and cold to charge our daughter rent - geez....she was 23 (DH & I had already bought my first house by then).
I admit to struggling with the desire to want to give her money or buy her some extras - I work hard to fight that urge

[Spanky]

Our kids, we feel, do delay ER since we want to support their college education. It's one of the greatest rewards in life to see them graduate form college and then making contributions in society.

[donheff]

Boomerang kids are very common. I moved home with a preggers wife for a couple of months at age 25. Didn't seem to bother my folks much and didn't cost them much. My son moved back at our suggestion for two years at 27 and finished college. When the time was right we told him to hit the road. He lives about 5 blocks away in hs own home, is a joy to have around and very responsible. DD is a senior now and I wouldn't be surprised to see her pop back home in a couple of years if NYC doesn't work out well.

It doesn't have to be a cold no or an unrestricted gravy train. With common sense you can help out without major costs and without encouraging "failure to launch."

[Milton]

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Originally Posted by Rich_in_Tampa I see our friends who chose not to be parents as being as content and satisfied as we are (that's why they're our friends ). We sometimes exchange reflections about how nice it must be at times to have kids/not have kids and can share the joys and trade-offs of both decisions. But none of us regrets our choices.

Very fair-minded. Bravo!

At least one academic study [http://www.pop.upenn.edu/rc/parc/agi...RCwps96-02.pdf] suggests that the presence or absence of children does not significantly affect the happiness of men in their middle and later years. Although that study reported that childlessness might be important to women's emotional wellbeing, a more recent study by the same author reportedly says otherwise: Childless women fare as well psychologically as mothers at mid-life.

[simple girl]

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Originally Posted by Milton Although that study reported that childlessness might be important to women's emotional wellbeing, a more recent study by the same author reportedly says otherwise: Childless women fare as well psychologically as mothers at mid-life.

Thanks for sharing that link, very interesting

[Nords]

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Originally Posted by macdaddy I am curious what people's attitudes are about family estate planning to avoid estate taxes. Anyone with more than a couple million in assets is looking at massive estate taxes in the future. Let's say you have health care provided by an ex employer and a pension that covers all your living expenses, so you don't have to worry too much about cash. If your kids are genuinely hard workers, and you trust them, wouldn't you start to transfer your assets to them? Would this be different than supporting them, meaning paying for a lifestyle that they can't afford themselves?

The heck with the kids, I'd rather plan my estate to ensure that my money goes to worthy charities rather than to governments with their hands out.

But if we're just talking about whether or not to give money to your kids, I like the Buffett approach: Give them enough so that they can do anything, but not so much that they can do nothing. I appreciated the fruits of my labors that much more for having labored over them.

I've been gifted money by my father and it's worked out fine. Spouse has been gifted money by her parents and it's been a nightmare. Never again. Next time any of our parents send checks our way we'll do something nice with their money for someone else and let them know that they should feel free to give it to their grandkid instead of to us.

I'm trying to come up with a nice way to let our parents know that-- if they haven't already-- they should include us out of their own estate planning.

[Milton]

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Originally Posted by Nords Spouse has been gifted money by her parents and it's been a nightmare. Never again.

What happened? Were certain (explicit or implicit) conditions attached?

[donheff]

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Originally Posted by macdaddy I am curious what people's attitudes are about family estate planning to avoid estate taxes. Anyone with more than a couple million in assets is looking at massive estate taxes in the future. Let's say you have health care provided by an ex employer and a pension that covers all your living expenses, so you don't have to worry too much about cash. If your kids are genuinely hard workers, and you trust them, wouldn't you start to transfer your assets to them? Would this be different than supporting them, meaning paying for a lifestyle that they can't afford themselves?

DW and I divided our assets so when one of us dies the total amount doesn't go into a single estate (e.g. she owns our primary residence, I own the weekend house). We then separately put our assets in trusts going to the kids with the surviving spouse able to use the funds for their own support. We also added so called bimbo clauses and rotten daughter and son-in-law clauses. The bimbo clauses would prevent the surviving spouse from giving everything away to the "bimbo" or "bimber?" and cutting out the kids. I'm not sure whether that clause is actually necessary with the trusts - but, whatever. The trusts are also structured such that the proceeds do not become part of the kids' marital estates if our kids are married or get married after we die. Thus, if they divorce, what they get from us stays with them.

DW's firm has some top-notch estate lawyers who set things up for us. I understood the terms at the time we set things up and they made sense to me. But I would have to re-read everything to fully describe it now. The topic makes my brain go numb.

[Eyerishgold]

Do the Right Thing When is it okay to cut off adult kids? «

Something I just ran across this morning.

[FinanceDude]

I have two kids, and I already have started "money management" training, at the agesof 8 and 5.

[lazygood4nothinbum]

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Originally Posted by macdaddy If your kids are genuinely hard workers, and you trust them, wouldn't you start to transfer your assets to them? Would this be different than supporting them, meaning paying for a lifestyle that they can't afford themselves?

later in life, mom said she wanted to gift us so she could share our enjoyment of the extra cash but by then alzheimer's kicked in and so she kept forgetting and so we never received such gifts. upon assuming guardianship 5 years before the end, we enacted her iving will which stipulated that we were to take tax-free gifts yearly. most of that money i saved (and then retired early on) but also used some to update my house and i splurged some on a yellow vertible stang which my mother loved to go to lunch in.

my fiscal childhood was a combination of spoiled brat and house slave. i didn't just cut the lawn and take out the garbage; i also cleaned the pool and scrubbed the decks. a cleaning lady did the house but i did a lot of the cooking and cleaning up after dinner. i received a generous allowance and never felt lacking cash. as mom saved my young letters from camp, i am reminded that i was always asking for more money, for care packages or to send up some of my own things. so apparently when i wasn't doing their chores, they were doing mine. i guess i was born into a cooperative.

in fact, many of the chores i did and allowance received were contracted with signed papers. it was the business of family. my mother would have done anything for me, i was as lazy then as i am now, my biodad was completely uninvolved, my stepdad who arrived early in life had a family motto: "sh*t for yourself." so there were always some interesting dynamics in play and the contracts helped to spell things out for all of us.

at 18 i was shown the door (to college) and i was never invited back home. i worked summers and got student loans and my parents kicked in whenever i fell behind. i think they raised me with a good balance of growing independence and of aid when in need. i gained a sense confidence that comes from knowing that they would help if required.

my parents never retired but not from lack of money. i think the ol'man would have liked to quit but mom was a workaholic and so he kept the business going so mom would have a place to work. they were always very supportive of each other. in fact, i never met two people who worked so diligently on their relationship together.

the ol'man never would have sacrificed his retirement for his kids. but he worked until he died to keep mom happy. they worked and worked and worked but it had little to do with money.

[youbet]

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Originally Posted by Eyerishgold Do the Right Thing When is it okay to cut off adult kids? « Something I just ran across this morning.

I think Rich hit it right on earlier when he said that spending money on kids disproportionately to your means is only one way to make RE difficult financially. You could also be living in an excessively large house, paying for an unneeded FA, not doing a good job with tax planning, buying loaded funds, accumulating unnecessary "stuff," and on and on and on.......

There have been a lot of interesting anecdotal examples of disproportionately generous gifting from parents to adult children given in this thread and I'm sure they're all accuate and true. But I must say that in the dozens of households (relatives, friends, etc.) we're familiar with, we know of only one example where we'd question the level of financial support the parents are giving an adult child. On the other hand, we're familar with several situations where the adult children have stepped in to be extremely helpful to their parents, financially and in other ways.

I don't think this subject can be painted with a broad brush.

[Milton]

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Originally Posted by youbet I don't think this subject can be painted with a broad brush.

Generalizations are always dangerous ... but useful, nonetheless.

[JustCurious]

Do the Right Thing When is it okay to cut off adult kids? «

[Nords]

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Originally Posted by Milton What happened? Were certain (explicit or implicit) conditions attached?

Not verbally but effectively yes. They've never felt comfortable relinquishing control.

The money came across during the late '90s bull markets and I suspect that by 2002 they sincerely regretted gifting it. We've always kept spouse's "gift" money separate from the ER portfolio, but as we were raising our ER equity allocation they were going into 100% Treasuries & CDs and they weren't happy with the Fed slashing interest rates. By 2004 they were squeezing nickels until the buffalo whimpered.

I bet they were as tired of telling us their "sure hope you know what you're doing" attitude as we were of hearing it. I don't think they'll ever buy a stock or an equity fund again, and I think they felt we were foolishly risking our savings with our allocation. We could never get them to accept that a federal pension is the equivalent of I bonds.

Spouse will probably use their gift money for their long-term care expenses (if necessary), and I wouldn't be surprised if someday they asked for it back. I don't mind managing our finances but I don't enjoy back-seat stewardship.