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Old 02-14-2008, 02:17 PM   #21
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I see nothing wrong with helping your children or your parents if you can afford it . To me it's the rhythm of life . My parents helped me now I help them and my child .
I used to be with you in the "Gotta know your parents" camp, but we've had a bad experience with my parents-in-law. I no longer believe in sharing family money. It'll be interesting to see whether PILs feel the same way when a new tax year rolls around. It's only money but you can't just go buy a new set of PILs.

Of course the money issue may have merely hastened the conclusion of an inevitable & irreversible process. So perhaps we should be grateful for the experience.

Of the money that will probably drop into our kid's lap, we're trying to couple the experience to her hard work. We've given her enough money (when she was younger) for her to learn how to manage it, and now it's up to her to learn how to make it and invest it with as little gifting as possible. For example her W-2 for her part-time job gives her a chance to start up a Roth IRA, and we've made sure that it's funded to the full extent. (She hasn't really been spending it anyway.) If she goes to college on scholarships (instead of just relying on the college fund) then there'll be profit-sharing.

When I was a teen/20-something, I remember how frustrated I'd feel when I made money/budget mistakes. But I'd be even more frustrated when my parents swooped down with a "There, there, we'll make it all better" attitude ad a check in the mail. A few years later I apparently hadn't learned my lesson when we asked for a bit of down-payment help from my father for our first house, but he was smart enough to say "Gee, sorry, my money's all tied up in the stock market right now and the taxes would kill me." Spouse & I really relished the feeling we got when we went back to the seller/bank and worked it out on our own.

We haven't made that mistake with my parents since, and I wouldn't deprive our kid of that experience or feeling of accomplishment.
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Old 02-14-2008, 02:58 PM   #22
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Well, there is a possible downside. According to Chapter Five of The Millionaire Next Door, adult children who receive substantial economic gifts generally accumulate less wealth than those who do not.

Why? For one thing, normal ambitions may be stunted. For another, houses or similar gifts (private school tuition for the grandkids, etc.) may inadvertantly pressure the children to elevate their lifestyles to keep up with the Jones, which of course is incompatable with LBYM.

I don't say that such problems are inevitable, or that The Millionaire Next Door is a meticulously-documented, infallible source (it's not). But these points are worth bearing in mind.

I'm not talking about giving substantial gifts to my child or my mother but there is no way I can stand by and see them struggle . I pay for my mother's home health aide and I'm happy to do it .I occasionally ( Okay most times I visit ) I buy my daughter something for their house . I'm not forking over thousands of dollars ( except for the wedding ).I'm much too thrifty for that plus I also believe the kids have to find there own way . I've gotten good at saying "You'll work it out ".I'm probably more protective and worry morry about my daughter since her brother died but that's just natural.
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Old 02-15-2008, 09:44 AM   #23
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I can totally relate to that. The reason my parents are helping my sister and not me is because I defied their parental authority. When I decided to leave Europe to go spend 2 years in America to get my MS degree, they forbade me to go. They threatened to cut me off, using my inheritance as leverage. I went anyway and since then I have clearly been paying for my "disobedience", especially since I never came back (I had not planned on staying in America, but even the best plans have hickups; I didn't plan on finding the woman of my life right here in America). Now don't get me wrong, I love my parents to death and we have remained very very close, even after my moving away (I am closer to my parents than my wife is close to her mom living down the street from us). But, nonetheless, they are far more generous with my sister and, as I mentioned earlier, they are in the process of building her a house. But I am not envious of my sister. They use that leverage to get her to do everything they require, often trampling all over her private life. She often gets upset and angry, but she realizes that the relationship with my parents is a complex one based on mutual dependency. On the other hand, they have no leverage over me. I do as I please. I actually think that, on some level, my sister is envious of the freedom I have. My cousins who have received large sums of money from their parents are also very "tied" to their parents, some willingly, some not so willingly.
As strange as it may sound to some people..... yes.... there are some things in life that ARE more important than money. And your freedom is certainly one of them. I am beholdant to no one.... and I would never choose to live my life any other way. I choose to do things for others because I care about them, not because of a sense of obligation or fear of loosing something they can provide me with. In any relationship between parents and their children thinking of the word "leverage" should not happen. That is not going to be a heathy relationship.
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Old 02-15-2008, 10:43 AM   #24
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I pay for my mother's home health aide and I'm happy to do it. I occasionally (okay, most times I visit) buy my daughter something for their house. I'm not forking over thousands of dollars.
Sounds reasonable to me.
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Bank of Mom and Dad
Old 02-17-2008, 02:18 PM   #25
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Bank of Mom and Dad

I never grew up with the opportunity to make any withdrawals from the Bank of Mom and Dad, but as a new parent, I don't think that giving your kid some money to help them get started is in itself a bad idea. BUT, you have to have raised them right with proper understanding on the value of money, how to manage it, and how to build wealth, otherwise your just throwing your money away.

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Old 02-17-2008, 03:15 PM   #26
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DH's grandfather was "the richest man in town" in a very small town in the midwest and gave each of his three sons a home. DH's father gave his kids each a car (but we have them our car back as we did not need it) and a downpayment on a house. DH and I gave each of our kids a car (of course they cost more than the home DH's father received from his father). Wonder what our kids will give their kids.... On the other hand the typical gifts from DH's parents through the years have always been quite thrifty; my parents passed away before we were married/had children so no "help" there and I miss them every single day. $$ not important--we would still have been able to buy our home without DH's father's help. DH's father and grandfather's generation did feel entitled, but not DH's generation and certainly not our kids who work hard and are better off than we are financially. We paid for their college and daughter's wedding--if blessed with grandchildren we will certainly be enjoying ourselves by thinking of them.
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Old 02-17-2008, 03:22 PM   #27
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The concept that gifting surplus assets to the kiddies always creates some sort of undesirable obligation on the part of the kids to the parents is only true in some cases. In many cases, the ongoing parent - child obligatory link is established strictly though emotional ties developed through the child rearing years. No monetary or other asset transfer may be involved, or even possible. The child may simply have protective, family-oriented tendencies and naturally just want to be part of the ongoing extended family team. Driving an elderly parent to get groceries once a week is a natural act of kindness for one child, a hellish obligation for another.

And, sometimes it's the kids, not the parents, who seek the ties in those cases where monetary transfers are involved. For example, we've listened to young people right on this board moan and groan that the Bank of Mom and Dad could easily have helped them more though college, could have easily provided a down payment for a first home, could have had nursing care under Medicaid instead of private pay, etc., and instead spent the money on themselves or gifted it to others. Or the whining when one sibling recieves more than another. Yuuuch.
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Old 02-17-2008, 04:44 PM   #28
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I never grew up with the opportunity to make any withdrawals from the Bank of Mom and Dad, but as a new parent, I don't think that giving your kid some money to help them get started is in itself a bad idea. BUT, you have to have raised them right with proper understanding on the value of money, how to manage it, and how to build wealth, otherwise your just throwing your money away.

musings on personal finance
I feel as if I've just been spammed to generate blog traffic.

Would you mind showing me what specific topic at your link corresponds to this thread on outpatient economic care?
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