Money and adult children?

[pb4uski]

You are the nicest ex-DH ever!!!!

Now that college and weddings are out of the way, DH and I like to be generous to our kids in small ways (a little check for Valentine's Day, enough to enjoy a nice dinner but not enough to buy the stove). If there's $ left when they close the casket on us, it's theirs.

Oops.......you know I meant DD.

 

[pb4uski]

....I plan to take care of college tuition, if that's the appropriate step for them or help some how, if college isn't the right choice in the future. ....

The 'help somehow if college isn't the right choice" part is something that we haven't had to face thus far with DS, who decided not to go to college (compared to DD, who did and for whom we paid the cost).

I'm torn as to whether we should be more lenient in helping DS once he gets out on his own (he lives at home now but hopefully will soon be leaving the nest). I suspect that we will help out but it will be in little, more subtle ways. DS has never play the card "DD went to college and I didn't so I am due something" and I don't think he would, but I sometimes wonder what my response would be. I just don't want to step out onto a slippery slope of continually trying to keep things "even" for our adult children.

In my mind, any evenness is that they both had an opportunity for an parent paid college education and if one decided not to take advantage of the opportunity, they are not due anything other than the opportunity should they later decide to take advantage of it.

Curious as to whether others have faced this and how you have handled it but I am cognizant that the question might hijack the thread.

 

[Aiming_4_55]

The 'help somehow if college isn't the right choice" part is something that we haven't had to face thus far with DS, who decided not to go to college (compared to DD, who did and for whom we paid the cost).

I'm torn as to whether we should be more lenient in helping DS once he gets out on his own (he lives at home now but hopefully will soon be leaving the nest). I suspect that we will help out but it will be in little, more subtle ways. DS has never play the card "DD went to college and I didn't so I am due something" and I don't think he would, but I sometimes wonder what my response would be. I just don't want to step out onto a slippery slope of continually trying to keep things "even" for our adult children.

In my mind, any evenness is that they both had an opportunity for an parent paid college education and if one decided not to take advantage of the opportunity, they are not due anything other than the opportunity should they later decide to take advantage of it.

Curious as to whether others have faced this and how you have handled it but I am cognizant that the question might hijack the thread.

I'm thinking, if one prefers college and the other wants to start a business, I would be supportive. I guess I would help him fund a small business or franchise if that's the direction but only if proper research and dedication is there. Not exactly sure, but openminded for now... as I view helping for my kid's success is college, a business, etc. I have a bucket for each of my kids... we'll see what the best option will be when we get there.

 

[Lsbcal]

...(snip)...
Curious as to whether others have faced this and how you have handled it but I am cognizant that the question might hijack the thread.

We only have one son so have not exactly faced this. However, once he went out and worked in the real world he found out fairly quickly that he wanted to continue his education.

We then helped him and he should be graduating from college this May. We are celebrating with a trip to Europe for ourselves . No "help" after graduation except for continuing his medical until he can afford it. It's been a long haul but worth it.

 

[MichaelB]

The 'help somehow if college isn't the right choice" part is something that we haven't had to face thus far with DS, who decided not to go to college (compared to DD, who did and for whom we paid the cost).

I'm torn as to whether we should be more lenient in helping DS once he gets out on his own (he lives at home now but hopefully will soon be leaving the nest). I suspect that we will help out but it will be in little, more subtle ways. DS has never play the card "DD went to college and I didn't so I am due something" and I don't think he would, but I sometimes wonder what my response would be. I just don't want to step out onto a slippery slope of continually trying to keep things "even" for our adult children.

In my mind, any evenness is that they both had an opportunity for an parent paid college education and if one decided not to take advantage of the opportunity, they are not due anything other than the opportunity should they later decide to take advantage of it.

Curious as to whether others have faced this and how you have handled it but I am cognizant that the question might hijack the thread.

Evenness is in the eyes of the beholder. Having seen how others react to perceived favoritism (badly and often cruely) DW and I do not have evenness as a goal. When we help it is different to each, the exception being college.

 

[MichaelB]

The real issue is how far down do you spend in assets for your own safety?

At 60 is it OK to spend 5% of assets?

At 70 is it OK to spend 6% of assets?

The leftovers are for the kid, but where is the safe border and do you sleep well at night?

Despite FIRECalc and my own models, I still struggle with this. DW and I are planning a few nice trips this year.

There is not an easy answer to this, and the calculators aren't much help, because we don't know how much time is ahead. My aunt passed away last year. In her final year, as the circumstances developed that led to her passing, she did comment to her sister that she should have spent more money on herself. She was then withdrawing around 10% between taxable portfolio and IRAs, and
this represented more than 3/4 of her total spending. Still, one year earlier, her concern was still outliving her assets. I guess most of us do not recognize the moment when we need to shift from outliving our assets to just living them.

 

[Animorph]

Is inheritance to your children part of your retirement fund plan?

I've sent my only child to two college degrees and even paid for her wedding.
I also started her Roth-IRA and contributed about 3 years into it.

After that, I made it clear that she and her husband are on their own.

If I and my wife dies early, my daughter can inherit a good amount, but I intend to spend it all in my retirement. It's mine alone.

Your opinion on this?

It's all ours, but short of buying an all-in annuity there's no way I can spend it 100% and still have some margin of safety (and self-insured LTC contingency) when we're 100. So more than likely our kids will inherit something close to the current value of our portfolio.

 

[growing_older]

I forsee the same thing happening to me. If I have a portfolio with a margin of safety that I am comfortable with, then barring huge final illness expense, my kids will inherit enough to retire on themselves. I guess I had to choose this alternative or annuitize, but frankly depending on an insurance company seems more risky than keeping control myself.

I've lead the kids to believe they will get next to nothing, so they will learn to LBYM and save and invest themselves. Then getting an inheritance years from now when I am gone will hopefully not hurt the characters of thrift and self-reliance they develop for themselves.

 

[FIREd]

We don't have kids, so we can't offer any opinion on the subject as parents.

My parents however are very proud to be able to leave a legacy and they have started gifting some of their assets to us. MIL too felt very strongly about leaving her house to DW. But given her limited means in retirement, she won't be able to.

 

[kz]

A few years ago inheritence was part of the plan but now we've decided to spend it "with" the kids instead of waiting until we're gone. (we did pay for their educations and will do the same for the grandchildren) And if there is anything left once we're gone I hope they will enjoy it with their children.

 

[Birchwood]

Margin of safety, that's the major factor with @lsbcal's comment.

It can be any % of the asset. but the only thing we can be uncertain of is how our health will hold up thru the years and how much time we still have.

By eating good, exercising and physically active, we can help with both health and time but still the out of pocket expenses for health can be a huge amount of money-- so there should be a margin of safety included in the plan.

 

[Nords]

There is not an easy answer to this, and the calculators aren't much help, because we don't know how much time is ahead. I guess most of us do not recognize the moment when we need to shift from outliving our assets to just living them.

I'd prefer to remain blissfully ignorant of my impending demise. I don't mind pre-empting it by living healthy, but I don't need to know exactly how much time is left on the clock.

 

[Shawn]

Oops.......you know I meant DD.

You have to admit, it would make for an interesting Valentine's Day card ...

Dear Wife,
I love you. If you ever decide to marry another man, I will gladly pay for the wedding.
Love,
Husband

​

As for inheritance, I don't have any children. If I did, they would get zip (except for educational, medical, or special care needs). I expect to have a reasonably-sized estate. It will go to charity.

 

[SJ1_]

Is inheritance to your children part of your retirement fund plan?

I've sent my only child to two college degrees and even paid for her wedding.
I also started her Roth-IRA and contributed about 3 years into it.

After that, I made it clear that she and her husband are on their own.

If I and my wife dies early, my daughter can inherit a good amount, but I intend to spend it all in my retirement. It's mine alone.

Your opinion on this?

we did the same thing. Hope to spend a lot of it in retirement but seems no matter what there should be a lot left
One spin we put on it is rather than waiting for us to die (my parents 91-89 wife's mom 92) to enjoy an Inheritance we decided to take our son wife and children on vacations once a year with us. this summer will be the first so we'll see how that goes.

 

[Moemg]

our son wife and children on vacations once a year with us. this summer will be the first so we'll see how that goes.

We have done this for five years and what great memories !

 

[Independent]

This:

While we have told our kids not to expect any inheritance, the reality is that it is likely that they will receive [an] inheritance, not be because we intended it, but more because of the conservatism built into our plans which is at least in part intended to make sure that we will never be a financial burden to our children. That and LBYM flows through our veins and we find it difficult to splurge other than just every once in a while.

I'm surprised that more people haven't stated it.

We're not going to be happy unless we've got enough in the bank to pay for "some big emergency", (which is probably LTC expenses) so we won't be a burden on the kids. If we die without spending it, we'll be happy that the kids get it.

If we die young, they'll get more. That's okay, too.

AFAIK, the only way to be sure that you die with nothing, while not running out, is to annuitize everything. We decided against that.

 

[73ss454]

Remember "it's better to give with warm hands than cold"

 

[Rambler]

We intend to fund Roth IRAs for our two kids whenever we can, and I have told them so. I've also told them that this will not start until we are retired and see our way to be able to do it and still take care of ourselves. I've also told them that when we can't do it, we will not. Current projections (pretty conservative) tell us that we will likely have no problem doing that, but you never know. We also intend to have family vacations with them, their spouses, and our grandkids every now and again, but this is not likely to happen every year...maybe one in two or three. On the off years, we will enjoy our own vacations and trips in the RV to go see them...when we get the RV. We project that there will still be a significant inheritance, but I see no need to save so much that the government gets it instead of us enjoying it with them.

R

 

[Danmar]

Many good comments and mine would be consistant to most. Pretty hard not to leave some legacy given the uncertainties involved. We have been very generous to our daughter and will continue to be. It is a lot more fun to see them use the funds while we are around.

 

[skipro3]

My kids can divy up the real property; house, cars, furnishings. All probably worth at least $500,000 if cashed out. (Insured for probably at least twice that amount if I had to replace it after a disaster.)

The cash is ours. If there is anything left, I've willed it to the progeny of my children or their children, dependents under 18 for educational purposes only. My estate planning attorney set it up.
Teach a man to fish and all that......