Good friends are spending too much

[freedomatlast]

2nd golden rule....MYOB

 

[TheWizard]

Was that wife gainfully employed

2nd golden rule....MYOB

3rd golden rule: BYOB...

 

[freedomatlast]

LOL!

 

[Exit 2024]

I would not worry about them , they are adults and they are capable to make their own decisions.

Also you disagree on their house purchase but they did pretty well with it, already earned about $1m and by the time they will need to sell it price may go up a lot more.

High level of spending? It is their business, husband mentioned that they will need to downsize on house, may be that was the plan all along, RE investment? Would that bother you if they would buy less of the house and invested difference and then mention that they will need to sell that investment?

 

[RetiredHappy]

Wife had a good paying job as did he, but stopped a couple of years before her husband, which surprised him.

They certainly did well with their home purchase. When we all decided to move, their plan was to move into their "forever/retirement" home and so was ours.

Last year, she had brought up that they would need to downsize again and we were a little surprised by the use of "need". We didn't ask. Last week he brought up that they would run out of money in 7 to 10 years time and hence they will need to sell their home. He thought maybe they could cash out and buy a $1M home and take a $400K loan on it. I think it is very difficult to take a mortgage when the income may not be able to support the loan payment. I suggested to simply get a cheaper home. My husband suggested that they stay put and take on a reverse mortgage.

Yes, MMOB but they had brought it up. I am not suggesting on saying anything to them, other than we will be a bit more careful in future expensive joint trips. We had often booked 2BR/BA in Hawaii, on the east coast etc, and invite them to join us. Since we only fly first / business class, they would buy their own tickets in the same cabin class. We each get our own rental cars. Maybe we will do fewer expensive trips with them. On the other hand, they are adults and can decide for themselves whether they would join us. We are very close and tend to do the new experiences/locations trips together.

 

[Cayman]

It's their business. Unless they specifically ask you for help - then of course offer advice. Otherwise let them live their lives, make their own choices.

 

[youbet]

Maybe we will do fewer expensive trips with them.

Excellent idea.

 

[2HOTinPHX]

Wife had a good paying job as did he, but stopped a couple of years before her husband, which surprised him.

They certainly did well with their home purchase. When we all decided to move, their plan was to move into their "forever/retirement" home and so was ours.

Last year, she had brought up that they would need to downsize again and we were a little surprised by the use of "need". We didn't ask. Last week he brought up that they would run out of money in 7 to 10 years time and hence they will need to sell their home. He thought maybe they could cash out and buy a $1M home and take a $400K loan on it. I think it is very difficult to take a mortgage when the income may not be able to support the loan payment. I suggested to simply get a cheaper home. My husband suggested that they stay put and take on a reverse mortgage.

Perhaps you could take a look at this thread I started a few days ago on reverse mortgages. There is a really good video linked and a book by Wade Pfau. They might be in one of those situations where it could work well for them?

Using Reverse Mortgages in a responsible retirement Income Plan discussion.

Hello all, I have seen a few brief reverse mortgage discussions here regarding some specific situations and thought perhaps a more general discussion might be useful. I think the general consensus is to avoid them if possible and only use as a last resort for various reasons. Probably some of...

www.early-retirement.org

 

[Midpack]

I wouldn’t bring up the subject of finances with any of my friends period - even if I was concerned they’re making a big mistake. When it has come up, I stay very general. You do NOT want to be blamed for giving bad financial advice, that’ll end a friendship for sure.

If a friend actually asked me in earnest, even then I would say little and focus on referring them to a book(s) or another resource I trust. If they seem professional help, I’d make suggestions on how to choose an advisor, but it has to be their choice.

All of us are adults who made it this far. So we should be capable of making our own way, smart enough to ask if we don’t, and learning the easy way or the hard way from there?