Ramifications of Revealing Wealth

[Golden sunsets]

We never, ever discuss our financial situation with anyone-including our adult children. There is really no need for anyone to know anything other than we are comfortable. Any knowledge past that point can only bring us grief. Most especially from the n'er do wells. It only breeds resentment, envy, and a few other unpleasant things. So why enable that? We prefer to keep our mouths shut and our eyes and ears open. on.

I disagree with this approach. Depending on the age of one's children and the level of their maturity, I believe it is appropriate the share finances and anticipated bequests. We have two children, ages 29/31 who are responsible adults. We want our children to know our financial situation, where to find appropriate records if necessary and possible inheritances. Unless we had a disabled child or grandchild, I can't see splitting our estate any other way than 50/50.

 

[Redbugdave]

There is another Awkward Wealth Moments thread active right now. Consider this a thread for when revealing wealth becomes more than just awkward, like affecting relationships.

When I retired it was a year after selling a company. I made enough from the transaction and my previous savings to be FI and retired a year later (though I call it a sabbatical to all but my closest friends and family).

Here's the problem. My mother knows my net worth. She is currently undergoing cancer treatment and her prognosis is uncertain. Since my brother and sister live 2 hours away, I am her main support person when she needs rides to doctors, help around the house, and I manage all her administrative needs, finances, taxes, etc.

We are now working with an attorney to create a new will and trust. When it came down to answering how she wanted assets distributed she wants me to be the executor of the estate and she wants all the assets put into a trust for my younger brother who is a nice guy but also a never-do-well who can't hold a job.

Then upon his death, if there are any assets left, they should be distributed to my brother's son (currently 6 yo) as if the son is destined to also be a never-do-well.

If the son and grandson are not alive, then the assets would go to my sister's kids, and if they are not alive, to my children.

She says that this is because I and my children don't need the money. I agree I don't but my children are not me. It hurts because it reinforces all the insecurities I carry about mine and my children's "rank" in the family. I actually lobbied her to put my children equal with the other grandkids in the will (not me, my children) but she wouldn't hear of it.

Of course it is totally her call and I told her I support her doing whatever she thinks is right, and I am upholding that, but it feels bad and I'm afraid it may cause lingering resentment.

What situations have you faced where your FI status has affected close relationships?

The whole thing is crappy. I would tell your Mom to just make your younger brother the executor and be relieved completely of the mess. The other family members can also step up the the plate and help out, too. You don't need to be shouldering all the responsibilities. I have been there, too.

 

[nezz]

DH has a disabled sister and DH told DMIL to give any and all of his portion to his disabled sister but is concerned that bad vibes will be the result from other 2 sisters. DBIL also in a position to disclaim /redirect any inheritance from his mom to the disabled sis and I think he would. Any money to the sisters would be significant to them. It would be nice to take that money to pay off debts/mortgage to get to his ER or put towards a LTC policy for him but it's DH's call. I keep my mouth shut about it , I know she could use the money way more that we could but she also has a high risk of blowing it all. I hope DBIL is listed as the executor and can dole it out to her as she needs it.

 

[robnplunder]

Your mom seems to be playing favorites and it affects your relationship with her and with your siblings. I don't think she realized this at all.

IMO, it may not be a "favoritism" at work here. Rather, I read it as the mom trying to take care of a child with financial (and other) issues vs one that is already well off. I'd like to believe it is motherly love at work. I have/had 3 siblings and it was the one with most financial issue I tried to help the most. And I can tell you that he wasn't my favorite sibling at all, a black sheep of the family.

 

[MichaelB]

Yes. OP's mom needs a trusted friend and confidant to help her do what she wants to do for her children and, apparently, that person is OP. Leaving unequal amounts of material possessions to children and grand children is NOT a ranking or ordering of a parents love for those children. It's an expression of the parents desire for all her children to be safe and happy in life. If one is well off and exceptionally able to cope in the world, he might get less. If another has coped less well and is threatened by circumstances, he might get more. But the parent isn't rank ordering love and affection. In fact, the parent may love and appreciate the capable one more for not being the one causing the worry and anguish but, of course, can't say so.........

As a parent, providing unconditional love to all your children while shouldering worry over their well being (some more than others) isn't an easy thing. OP, help your mom and be proud that rather than being a worry or concern to your mom, you're a benefactor and there for her when she needs you.

I share this view, have tried to live it and urged my parents to do the same. It isn't easy, as parents and children we are all flawed, but it really is a blessing to be able to provide reassurance or comfort to another when both know it is motivated by love and compassion and not in exchange for a reward or future compensation.

 

[AnIntentionalRoad]

I share this view, have tried to live it and urged my parents to do the same. It isn't easy, as parents and children we are all flawed, but it really is a blessing to be able to provide reassurance or comfort to another when both know it is motivated by love and compassion and not in exchange for a reward or future compensation.

Thanks, this is a helpful way to frame the situation. I won't forsake my mother and will help her at a level I feel is appropriate--out of a son's loyalty and no other reason.

FYI, my brother, sister and I are on reasonably good terms, though we don't see each other much. I do believe mother is making decisions based on taking care of all her children/grandchildren according to their level of need. My children don't have financial needs, hence her decision.

As someone else mentioned, the key will be explaining to my kids why their grandmother structured the will this way, based only on perceived need, so they are not hurt by it.

 

[BellBarbara]

Wow. You are far more forgiving than I would have been. If my father had treated an ex's kids better than his own kids, and been so dysfunctional, I would have cut off all contact, and never spoken to him again. He could have spent the rest of his life homeless and living in a ditch.

I'm funny about those things, and definitely hold a grudge (I get that from my Mom, who was the same way). Once somebody treats me dirty, it's over. Doesn't matter to me if it's family or not.

There was a time I felt like this. I can't be bothered to let him get under my skin, it's just not worth it. I had a WONDERFUL mother and maternal grandparents and felt very loved. The nice thing about him being so distant and such is that we don't feel obligated at all, so we only do what we feel like and have zero guilt about calling all the time, visiting, etc. We thought of our grandpa as our dad, he was awesome.

When my dad dies I won't shed a tear. I won't spend a cent burying him or anything. Oh, and he did finally do a will naming my sister and I as the beneficiaries....though he has NPH and I doubt there will be anything left. He'll end up in a nursing home at some point.

We already agreed when he runs out of money we are not supporting him to live in a better place or anything.

 

[daylatedollarshort]

My parents would have split their estate equally but I told them to give it all to my siblings that they are closer to and who need the money much more. Plus I didn't want the strings I felt would be attached. It felt very freeing. No regrets.

I guess if I ever end up hungry and poor I'll be kicking myself.

 

[Milton]

Here's the problem. My mother knows my net worth.

Big mistake telling her!

She is currently undergoing cancer treatment and her prognosis is uncertain. Since my brother and sister live 2 hours away, I am her main support person when she needs rides to doctors, help around the house, and I manage all her administrative needs, finances, taxes, etc…. I actually lobbied her to put my children equal with the other grandkids in the will (not me, my children) but she wouldn't hear of it. Of course it is totally her call and I told her I support her doing whatever she thinks is right, and I am upholding that, but it feels bad and I'm afraid it may cause lingering resentment.

I hope that you won't let your frustration affect your willingness to help out now … far better to 'take the high road' and continue being a good son: not for mom's sake, but your own piece of mind.

As far as the "lingering resentment" goes, that is within your control and should not become a problem unless you let it. Remember that "life isn't fair", and tell yourself that worrying about this sort of minor injustice simply isn't worth it: your kids will turn out just fine, with or without the inheritance.

We are now working with an attorney to create a new will and trust. When it came down to answering how she wanted assets distributed she wants me to be the executor of the estate and she wants all the assets put into a trust for my younger brother who is a nice guy but also a never-do-well who can't hold a job. Then upon his death, if there are any assets left, they should be distributed to my brother's son (currently 6 yo) as if the son is destined to also be a never-do-well. If the son and grandson are not alive, then the assets would go to my sister's kids, and if they are not alive, to my children.

As you say, she can designate whatever inheritances she likes and you don't get a say. But nothing compels you to waste your own time serving as executor or trustee. To avoid confrontation at this sensitive time, I would not currently voice any reservations; but following mom's death, you can then respectfully decline the appointment.

 

[Milton]

I'm funny about those things, and definitely hold a grudge (I get that from my Mom, who was the same way). Once somebody treats me dirty, it's over. Doesn't matter to me if it's family or not.

It's entirely your call … but various studies have demonstrated that holding a grudge can lead to hypertension and other cardiovascular disorders, whereas forgiveness has a substantial positive impact upon one's psycho-emotional wellbeing.

 

[citrine]

I can identify with your feelings. My parents helped my brother out tremendously with medical school and paid all of his expenses till he got a real job a couple of years ago. In the money meter...they have spent close to 400K on him...maybe 75K on me. I let it get in my head and cause a lot of resentment....but I have had to let it all go. In the end, it is their money...none of my business how they allocate it. I will not be factoring any monies from them for my retirement stash.
If it makes you uncomfortable and resentful to be the executor, you can tell your mom to hire a lawyer. I also think you should let your mother know your feelings and have her leave something sentimental for your children so they do not feel left out.

 

[Totoro]

.. and have her leave something sentimental for your children so they do not feel left out.

I think that's a great idea, also for yourself.

It can even be a letter that she writes for them to be opened after she passed away, or a favorite recipe. Or childhood pictures.

My mom for example doesn't care about her parent's money (she is an only child and has plenty of her own), but the last pack of cigarettes her father smoked (long story) has a special place.

Likewise for me, there's a wooden storage box where my grandmother keeps all important things, it dates back to her years in Congo. It would be a great honor and emotional thing for me if I could (eventually) inherit that.

Some people may get money, but all of you have her love. That is a very powerful message.

 

[RobLJ]

I admire the poster for being a good son and to some degree the situation ironically is an expression of your mother's confidence in OP.
My DM is doing the opposite, which is to split the house (her only main asset) between myself and sibling, who is erratically employed and living with DM--but also providing needed support and care. I told her she should consider leaving it all to the sibling, but DM is sticking with what she and DF had decided--feels awkward since we don't need it.
There's no ideal solution. We're leaving a little more to the oldest who is happily working away in a good job and about to start a family, while the youngest DS started making 6 figures a few years ago. Nothing is set in stone, of course.
Tough decisions. But I suspect OP's Mother is expressing great confidence in him, which was the case of my parents, since I (and DW) were always fiercely independent.
Noone can tell you OP how to feel, however.

 

[PERSonalTime]

You have been blessed with good prosperity, kids, and a loving mom. Be thankful for your blessings and let your mom pass along her assets as she wishes. God has been good to you and your family and will continue to bless you all. It's that simple!


Sent from my iPad using Early Retirement Forum

 

[CaliforniaMan]

I forgot to tell the story of how my errant father mentioned above (asking to borrow 300K from me) once called me about 10 years ago (when he was still married to the ex-wife who has his house hostage) telling me he was creating a will and would be naming me executor....but that he wanted me to know in advance that he would not be leaving any money to me or my sister, he would be leaving it to the kids of this ex-wife (3 of which are losers). Hahaha Who does stuff like this? I didn't tell my sister as I knew she would flip out.

Make sure you charge the estate the maximum allowable executor fee!

 

[gauss]

As someone else mentioned, the key will be explaining to my kids why their grandmother structured the will this way, based only on perceived need, so they are not hurt by it.

Is it customary these day's to discuss grandparents finances with the grandchildren? Back in the day when my grandparents died, there was no discussing these matters with us. I think I was an early teenager at the time. Grandparents were definitely not wealthy.

We ourselves do not have children so all experience is second-hand.

I know that child raising has changed over the last 50 years, and this is the first time I have been exposed to this type of issue.

Truly curious - Thanks
-gauss

 

[Milton]

Is it customary these day's to discuss grandparents' finances with the grandchildren? Back in the day when my grandparents died, there was no discussing these matters with us.

+1. I see no apparent need for discussion, let alone explanation.

 

[Andre1969]

Is it customary these day's to discuss grandparents finances with the grandchildren? Back in the day when my grandparents died, there was no discussing these matters with us. I think I was an early teenager at the time. Grandparents were definitely not wealthy.

It might depend on the family. On my Dad's side of the family, Granddad is still alive, and if he makes it to October 24 he will be 100. That side of the family doesn't talk about money, though. There are three sons on that side of the family, six grandsons, and I forget how many great-grandkids. Might even be a great-great grandkid by now. I had always just assumed that whatever Granddad had would be split evenly among the three sons. I heard that we grandsons are in the will as well, but I don't know what to expect. So, I expect nothing.

On my Mom's side of the family, Grandmom is still kicking, at 90. On this side, there's just my Mom, my uncle, and me...no other grandkids, and I never had kids. I know in this case, Grandmom and Granddad split the estate 40/40/20 (Mom/uncle/me). On this side of the family, we would tend to talk more about money...probably too much in some cases! I've learned to start being a bit more coy. As for 20% of Grandmom's estate...well, it's sizeable enough that, if I was to get it now, it could bump up my ER by a year or two. My goal now is to go out in 2020 at the latest, when I turn 50, so it could move me to 2018 or 2019. But, I have a feeling that OMY will kick in, regardless of when Grandmom passes away, and I'll still hold off until age 50.

 

[marko]

Is it customary these day's to discuss grandparents finances with the grandchildren? Back in the day when my grandparents died, there was no discussing these matters with us.
-gauss

I wonder if it is a matter of how a family views wealth overall.

For some, it is not viewed as "money" but a resource. As such, it is easier to look at money/inheritance/etc as something to manage rather than something to spend.

Everybody knows (or has an idea) how rich Dad/Grandad is, so it is not a matter of discussing some taboo as much as preparing for the next generation to manage that wealth. (i.e. "here is the lawyer to contact")

 

[jjquantz]

I wonder if it is a matter of how a family views wealth overall.

For some, it is not viewed as "money" but a resource. As such, it is easier to look at money/inheritance/etc as something to manage rather than something to spend.

Everybody knows (or has an idea) how rich Dad/Grandad is, so it is not a matter of discussing some taboo as much as preparing for the next generation to manage that wealth. (i.e. "here is the lawyer to contact")

This reflects the past in DW's family. Her grandfather sent out a yearly update on the will, account contacts, and general information concerning his finances. All family members received the update and everyone knew where everyone stood. Grandfather definitely viewed his accumulation as a resource that would benefit all members of the family.

When grandfather and grandmother passed on, the finances passed on to FIL and MIL (through a suspicious last minute will change, complete with funny signature, initiated by grandmother the day before her death. A woman who had never made a financial decision in her life. The passage of financial information moved into a black hole. There was NO discussion of finances among family members. FIL managed to squander much of the inheritance through well meaning but poor investment decisions. When he passed on, his finances were a disaster and now, 6 years on, we have ALMOST gotten everything straightened out.

I don't know what the perfect amount of sharing is, but I would argue that providing the surviving generation with ZERO information is probably insufficient.

 

[brett]

We are not yet ready to discuss this with children however they are aware of where to locate up to date summaries, legal, and accountant info.

When we last redid our wills DW asked if I wanted to make provision in our wills for one of her sisters or to a charity. I was somewhat taken aback by this. In my family it always goes straight down to the children. And I do not believe that our children will enjoy the same levels of financial rewards career wise that we have enjoyed. We decided to flow it down.

 

[clifp]

Had an uncle with a different perspective. As his adviser, I had gently asked why he was only willing a much smaller amount to one of our less fortunate family members while leaving a lot more to those with more resources.

"They have no real money" I argued.
"Well, then, to them it (that small amount) will seem like a lot! Why give them more!?" was his answer.

I love that, even if I don't really agree..

This comment and the thread reminds me that it is really hard to be fair,because perceptions of fairness are all over the map.

My mom had always been very good about dividing up the money equally. So eventhough I don't need the money her will (I am the executor) has the money split 3 ways. My younger sister and I have no kids and my older sister has 2 kids and 4 grandkids. My niece is an angel,and my nephew is a black sheep, that my mom can't stand. So it was relatively easy for my mom to just split the money 3 ways. My older sister always felt that the her kids should get something, but since it would be unfair to leave something to my niece but not my nephew she dropped the issue.

So a long come the great grandkids. My nieces 3 home schooled kids are angels. The nephew got divorced and their 12 year old son lives in New York with mom who is not mother of year material either. Mom sends (actually I automated it) each grandkid $50/month for lesson and another $50/month for college fund. Then she decided to leave each great grandkid $25K for college in her will. Not sure how my younger sister felt about $400/month on great grandkids. But I know she wasn't thrilled with that $25K. (Both of my sister are reasonably well off ~$1 million).
Sadly mom's memory is fading so she asks me least once month about the details.

I finally had to put the foot down the other day. My niece and minister husband are moving to a small town in Wyoming and prices were both pretty expense and the selection was slim. They put in fair offers on two different places and the owners refused to budget. Dear mom wanted to give them the extra $20K, and I said NO. I am not sure they wanted the money or help and even if they did my sister was in financial position to help her kids not grandma.

Still from my mom's prospective, she understandably adores my niece and just wants to make live easier for her. I don't care about the money and want mom to give it where it can do the most good. My younger sister is by nature a worry wart so she is concerned about mom running out of money and also herself eventually. She also doesn't think it is environmentally responsible to have kids. While my older sister thinks grandkids and great grandkids are the best thing ever, and sees no reason that mom should not help them.

The only thing I can say to the OP, is when the day comes and the will is read. Be prepared to explain how your mom's philosophy was to leave the money to those most in need and that it was NOT a reflection of her love for her grandkids.

 

[gerntz]

I admire the poster for being a good son and to some degree the situation ironically is an expression of your mother's confidence in OP.
My DM is doing the opposite, which is to split the house (her only main asset) between myself and sibling, who is erratically employed and living with DM--but also providing needed support and care. I told her she should consider leaving it all to the sibling, but DM is sticking with what she and DF had decided

If you disclaim your share when she's gone, won't it all go to sibling then?

 

[marko]

Be prepared to explain how your mom's philosophy was to leave the money to those most in need and that it was NOT a reflection of her love for her grandkids.

I suppose we could devote an entire other thread to inherited money and "lottery winner syndrome"

We have a few ne'er do wells (who, as a result, are perpetually "the most in need") who we are seriously concerned about if/when they inherit a piece of our estate.

We suspect it won't be pretty but we decided to split everything equally among all our nieces/nephews as we have no direct heirs. We'll be gone and it'll be their problem to sort out.

 

[rodi]

Is it customary these day's to discuss grandparents finances with the grandchildren?
...
Truly curious - Thanks
-gauss

On a similar topic - there are those that don't discuss their finances, at all, with their children. I'm taking a slightly different approach from hiding things from my kids... I'm trying to TEACH them how to handle money, budget and save for big expenses, etc. If you don't talk to them openly, to a degree, how can you expect them to pick up LBYM values.

They don't know exactly balances... but they are aware that we have a budget that needs to be maintained, but that neither parent needs to work. I've talked about saving when I was young and compounding is how we got here. I point out real life examples of friends who's family make good money choices, and some who don't make good choices.

If you never talk about money to your kids - how can your kids learn?

That said -I've also advised them I hope not to run out of money - but that I also didn't budget a big inheritance for them, either.