Like watching a car drive off a cliff...

[DawgMan]

This is more of a vent and frankly, not sure which forum this really belongs on.

Most everyone on this site obviously has similar interests/practices in planning their lives, controlling expenses, saving for RE, understanding investing, etc. What I have recently been reminded of is there is a whole other group of people out there who have made very poor irresponsible choices and will be at risk of living off SS only. Case in point, my 54 yr old BIL recently had an accident that for now has him wheel chair bound as a quadriplegic. There is a reasonable chance he will regain a fair amount of his mobility, but we will not know for 12 months. He & my SIL both have college degrees, however, he is the bread winner in a very narrow industry with limited income potential. SIL has always been under employed working part time in a sandwich shop. 4 kids between ages of 14 - 20, 2 in college. They have sacrificed everything to send their kids to private schools and college out of state. Fast forward today... this accident to my BIL has totally exposed their financial situation. They have some, but little NW in home, $15k in credit card debt, no savings/RE acct. Large family on my DW side and we will all be contributing $$ to bridge the next 12 -18 months until we know more. Both my BIL and SIL have their head in the sand and think everything will just work out. Even if he gets 100% back, they are driving off a financial cliff and refuse to see it regardless of any sound family advice. Frustrating, heart breaking none the less, but this is probably more typical than any of us want to believe.

 

[frayne]

Sorry to hear about your BIL and his situation but I would think they are probably in the majority. I wonder what percentage of the US population would be considered financially responsible ? My guess, less than 25% and that is no doubt generous.

 

[Pilot2013]

Both my BIL and SIL have their head in the sand and think everything will just work out.

I think this, unfortunately, is the majority of people. My Sis and I talk about this often. While I am not in perfect shape and could have done MUCH better (as evidenced by some on here), and a catastrophe would thwart ER, I think I would be able to make it without burdening others.

One of discussions with Sis is how those in situation like your BIL and his wife seem to live without a care in the world, while those of us that have the foresight and understanding of this need seem to have the more stressful lives...

 

[DawgMan]

What makes it worse is there are non adult kids (my nieces and nephews) involved that have been kept in the dark, been indulged most of their lives (never had a part time job) that are about to see their lives completely change (hopefully make them stronger in the long term). Also, while we as family provide a bridge for the next 12 - 18 months of up to $100K, its so clear how the movie ends here. We are providing a band aid to only see it get ripped off! The Family (at least we say this now) have said the financial aid will stop once recuperating period has ended. At that point, its their baby. We will see...

 

[mpeirce]

One of discussions with Sis is how those in situation like your BIL and his wife seem to live without a care in the world, while those of us that have the foresight and understanding of this need seem to have the more stressful lives...

Do kids get taught Æsop's The Ant and the Grasshopper any more?

 

[Ready]

Really sorry to hear about your BIL. Just being wheelchair bound is incredibly challenging, regardless of the financial situation. I hope he fully recovers.

 

[Car-Guy]

Also, while we as family provide a bridge for the next 12 - 18 months of up to $100K, its so clear how the movie ends here. We are providing a band aid to only see it get ripped off! The Family (at least we say this now) have said the financial aid will stop once recuperating period has ended. At that point, its their baby. We will see...

It's really nice to see your DW family step up but my guess is (only a guess since I don't know your family) if he doesn't recover as planned, the 100k and timeline will grow and grow. I've seen a number of similar scenarios and while they usually start off well, some family members don't always hold up their end of the bargain, for one reason or another, and the others end up doing or contributing more to help them keep up. But that will/can become another set of problems.

As a start, maybe the younger kids should start attending public schools and the out of state kids come back and attend a local collage or better yet, for the older ones "get jobs" to pay their own way.

 

[ivinsfan]

What makes it worse is there are non adult kids (my nieces and nephews) involved that have been kept in the dark, been indulged most of their lives (never had a part time job) that are about to see their lives completely change (hopefully make them stronger in the long term). Also, while we as family provide a bridge for the next 12 - 18 months of up to $100K, its so clear how the movie ends here. We are providing a band aid to only see it get ripped off! The Family (at least we say this now) have said the financial aid will stop once recuperating period has ended. At that point, its their baby. We will see...

Wow, that's a lot more then I would and just puts off the day of reckoning for all of them. They need 100K for basics? Now I'm not heartless and realize there was a health issue, but many bad not health related issues lead to this outcome. About how much of this amount will be your money and how do you know they won't continue with the crazy spending?

 

[LOL!]

When do short-term disability payments start?

For kids in college, they must have terrific financial aid if family had no savings. But they can drop out for a year to stay at home to take care of father. And they can work. There are lots and lots of "Help Wanted" signs in retail and food establishments.

For kids in private school, they can switch.

My post could be responded to with "It not about the nail." Can you tell my sex?
BTW, my wife's father died while she was a freshman in college. Things did change.

 

[Danmar]

Sorry to hear about your BIL and hope he recovers. Your DW's family are to be commended for stepping up.

Clearly the majority of people in our society don't do very well financially. Not much we can do about it other than realize how lucky (smart?) we are.

 

[MRG]

So sad on many levels. There's many in the same financial position.

A buddy of mine credits me with showing how he could get at his retirement funds. Well I did tell him about QDROs but not to get divorced to do so. Their still a happy couple, with zero retirement. Guy's close to 60, couple of kids in junior high school. Guys skills are very limited to the obsolete technology he supports.

 

[Johnora]

I'm afraid they are the majority....

First off, great job helping out your family as that is what family is supposed to do.

We have my DW parents living with us for last 14 years and will be until the end because no thoughts what so ever on how they were going to live in retirement. He even retired because he thought he should and then couldn't pay his mortgage. No thought towards money at all.

Because we are the planners, and I have laid out a long financial plan to prepare for retirement, my DW and I know that if and when anything else happens to someone else in the family who also is living life without a plan or a care, they will simply come knocking at our door.

However we might not be home....

People need to wake up, pay attention unless they wish to work much longer than they should.

My thoughts go out to your family for all they have done and I hope your BIL recovers 100% and is able to get back on track. As long as he is in a wheelchair he is a captive audience to talk to.

 

[W2R]

Life is tough sometimes. I don't have the statistics at hand, but my guess is that the vast majority of retirees live off social security alone so it can be done.

In his case it sounds like he would qualify for SS disability if he doesn't recover much. He may not be able to continue his prior lifestyle, though, and that plus the care he might need as a quadriplegic will be a big adjustment for him and his family.

 

[DawgMan]

In regards to some of the comments, yes, we have said 1) get older kids home now, take a semester off and get a job and/or go to local school and live at home, 2) remove kids from private school and put in public. BIL/SIL think a combination of college loans & pushing out $$ due for these will solve the issue until BIL is back "on his feet"... they are fooling themselves. Unfortunately, BIL started a new job in Jan and does not have disability leaving only SS to fill in the gaps. As mentioned earlier, this has been a lifetime of habits and the snow ball has been rolling down the hill just waiting for 1 event to implode it. Completely understanding the "needs" for the next 12 - 18 months is still a work in progress, but with no income, no disability, funding 100% of the medical premium and max out of pocket expenses, we anticipate a number larger than any of us would like. And yes, I see potential family conflict in all of this with who really gives and what... lots of potential for more family problems. For many reasons, it amazes me how people let this happen to themselves and their family, but clearly more of an epidemic than any off us would hope. I suppose its a combination of ignorance is bliss, entitlement, lack of responsibility/maturity, keeping up with the Jones, betting on the come, and pure illusion that let these people sleep at night. The sad part is we are all affected, particularly when its family, especially when minors are involved. Tough love is on the horizon as there is a fine line between providing real needed assistance and enabling...

 

[Walt34]

Do kids get taught Æsop's The Ant and the Grasshopper any more?

Apparently not. It was read to me many times and the message sunk in.

But as DawgMan notes this seems to be pretty much the norm. A BIL retired at 62 after his 2nd heart surgery and the doc told him "You're retired. Now." It did stress them some and the pension is not what they had planned on but at least they do have that. Had it happened before he was eligible for any pension at all he would have been on SSDI only, but at least his wife worked as a nurse and had a six-figure income.

They're both retired now and have a mortgage, two vehicle payments, and cc debt. We have none of those, so we find it hard to understand why people do that to themselves.

 

[Doughpile]

Interesting thread, I think we all have that relative (s) headed toward that cliff, I did not budget in my ER plan for bailouts so these actions give me heartburn,,,,


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[folivier]

If you can get all of the family who is contributing to agree to do something like this>
Draw up a contract that states in order to receive any assistance he has to do the following: 1) get older kids home now, take a semester off and get a job and/or go to local school and live at home, 2) remove kids from private school and put in public. Etc.....
Not really any different than the requirements banks put on someone with bad debt to get a loan.

 

[mpeirce]

...so we find it hard to understand why people do that to themselves.

My theory is that most people just do what other people do - i.e. follow the cultural norms.

That worked fine when almost everyone was a farmer/peasant and you saw how old folks were taken care of (they basically lived with younger folks until they died) and followed that pattern. It made sense to have lots of kids so there'd be at least one around to feed you when you got old.

Since the industrial revolution (not long ago really in generational terms) things changed. People didn't live in extended families as much, so it didn't work as well to just have granny and gramps live with the younger generation.

Culturally, we invented pensions. That sorta worked, for some, for awhile. And wasn't really economically sustainable. Certainly not when companies only last a few years and people change jobs a lot.

Social security helps. But it's basically a safety net, not a plan for living well after retiring. It keeps lots of folks from starving, but for some, that's about it.

Some portion of the population are naturally planners. People who think ahead and delay gratification for future benefit. Ants. Most of the folks here fit in that category.

For "ants" modern life offers many rewards. For "grasshoppers" not so much.

Of course you might argue that grasshoppers have more fun early in life, which ants give up. I don't see it that way myself.

So the real solution is how to establish new cultural norms so people do the right thing. Not sure how that's done, especially with such constant change going on in culture and work opportunities.

 

[Mulligan]

Apparently not. It was read to me many times and the message sunk in.

But as DawgMan notes this seems to be pretty much the norm. A BIL retired at 62 after his 2nd heart surgery and the doc told him "You're retired. Now." It did stress them some and the pension is not what they had planned on but at least they do have that. Had it happened before he was eligible for any pension at all he would have been on SSDI only, but at least his wife worked as a nurse and had a six-figure income.

They're both retired now and have a mortgage, two vehicle payments, and cc debt. We have none of those, so we find it hard to understand why people do that to themselves.

Hopefully they are like me, Walt. I have a mortgage, credit card debt, a vehicle payment (on another CC) and retired. But I could pay it off tomorrow if I chose to, though. Well, make it a week, as I have screwed up my finances buying too much stock and don't even have $500 to my name now...Better give me a week!


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[Souschef]

I have a cousin who fits the description. They have blown through over $1 M in inheritances! My BIL sat down with them to try to work out a budget, and it was obvious they will run out of money/ They live in some fantasy land that it will all come out right.

 

[Walt34]

Hopefully they are like me, Walt. I have a mortgage, credit card debt, a vehicle payment (on another CC) and retired. But I could pay it off tomorrow if I chose to, though. Well, make it a week, as I have screwed up my finances buying too much stock and don't even have $500 to my name now...Better give me a week!

Lots of members here have mortgages, cc debt and car loans but like you they also have the resources to pay them off. Nothing wrong with that of course.

But the in-laws do not have the resources to pay them off and instead rely on anticipated future income. That can create a problem.

 

[LARS]

It is very true that all of us are "but for the Grace of God" away from a disaster. However, how prepared we are for that disaster has little to do with God and much to do with our own preparations. There are exceptions to this, but what the OP describes doesn't seem to be one of them.

Thus, to my mind, much of the burden falls to BIL/SIL. Somewhere in all this is Lincoln's words of wisdom to his step-brother...

Finally, to my mind, these kind of financial situations take on a new meaning if you've retired and no longer have a paycheck to replenish spent funds.

YMMV...



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[LARS]

If you can get all of the family who is contributing to agree to do something like this>
Draw up a contract that states in order to receive any assistance he has to do the following: 1) get older kids home now, take a semester off and get a job and/or go to local school and live at home, 2) remove kids from private school and put in public. Etc.....
Not really any different than the requirements banks put on someone with bad debt to get a loan.

Sorry but this just allows the parents to shift blame from themselves to family members vis a vis their children. "We don't want to upset your life, but your nasty Aunts/Uncles are making us..."


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[Mulligan]

Lots of members here have mortgages, cc debt and car loans but like you they also have the resources to pay them off. Nothing wrong with that of course.

But the in-laws do not have the resources to pay them off and instead rely on anticipated future income. That can create a problem.

I always find it fascinating to see what is being rationalized in peoples heads who do that... I can relate in a way. I was that way more or less until about a dozen years ago or so. I just mostly focused on not being in debt, but accumulating any wealth was never important to me as I knew a pension was down the road. But it is a amazing how just a few tweaks and an attitude transformation can quickly bring about growing wealth. Although I will never be a 1%er, assuming I dont outlive Methuselah, but now I am accumulating more wealth than ever and doing less than ever to acquire it.


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[redduck]

...My post could be responded to with "It not about the nail." Can you tell my sex?
BTW, my wife's father died while she was a freshman in college. Things did change.

OK, I want to take a shot at guessing your sex, but I need more information. Can you give just one or two more clues?

note: words in bold by redduck