have the money. . . now what?

marriedwell

Confused about dryer sheets
Joined
Sep 22, 2005
Messages
2
So here is my situation . . .

My wife’s father was very frugal and smart and nice enough to set-up investment accounts for my wife in the early '70's when she was young. The $10-$15K he put into the account in the 70's are now worth close to $2,500,000 in stocks and bonds and payout roughly $60,000 in dividends a year. Now that is called ROI! She does do anything with the investments, only spends the money as it gets transferred into her checking/savings account.

On top of this, we just found out that we are inheriting roughly $1.5 million this year from a recent unexpected death in the family.

We are both in are 30's and have two very young children.

I am personally shocked by these numbers, as I thought that I was doing well with my $100K in savings until this situation unfolded after we were married.

I want to spend more time with my young children and feel like taking an indefinite "leave" from the real word to do so, and possibly travel with the our young family. I am very apprehensive to do this for several reasons:
1. Affraid her father would not approve of me not working (and living off his/her money)
2. Concerned it would insult my father who isn't retired and paid my way through college
3. Concerned about the what sort of example I would be setting for our children.
4. I would also like to continue to earn and save money for myself. . . "make money the old fashion way" . . . and also do not want to wake-up one day in the future to find my wife is leaving me and will be taking the /"her" money with her!

Sounds like a lot of issues for someone who is in an incredibly good finacial position doesn't it? ? ?

Any thoughts are suggestions?
 
Number one question in my mind: What does your wife think about all of this?
 
Have you had an appreciative, sincere chat with the wife and her dad? Better yet, ask them their advice after telling them how you feel about your current life/job.

If they care about you (sounds like they sure do), I suspect they would suggest you do something very similar to what you have planned. Then it's "their" idea and a win-win.

Congratulations and good luck. This board will get you started on careful planning if you stick around a while.
 
Above all, remember to be very, very good to your wife.
 
Welcome to the board, FLBoy!
FLBOY said:
1.  Affraid her father would not approve of me not working (and living off his/her money)
Tough one. It's not his money any more, though, it's his daughter's, right? Are there any legal strings attached, or "just" family expectations?

FLBOY said:
2. Concerned it would insult my father who isn't retired and paid my way through college
Well, some of your personal savings could go to your father as payback, but I'm not sure he'd appreciate that either. You'd have to hope that a father who truly loves you would be happy at your good fortune.

FLBOY said:
3. Concerned about the what sort of example I would be setting for our children.
Finally-- we have the answer that one!

One of our more experienced ERs exerted considerable effort to disguise his ER and to gradually break the news to his teenage kid. Years later it turned out that the kid was so busy being a teenager that she never noticed. And if she had noticed, she wouldn't have cared.

Our kid knows that her parents have enough money to live a frugal retirement, but that she personally is broke and will have to remedy of that situation on her own. We figure that living our ER life is a much better example for her to aspire to than living a sullen, miserable existence as cubicle dwellers. Not that there's anything wrong with that.

FLBOY said:
4. I would also like to continue to earn and save money for myself. . . "make money the old fashion way" . . . and also do not want to wake-up one day in the future to find my wife is leaving me and will be taking the /"her" money with her!
Seems like a wise move, as long as you enjoy what you're doing. This is theoretically a great chance to find out what you really want to do with your life, and worthy of discussion with your spouse and perhaps even spending some of your own savings toward that goal.

As Martha says, your opinion doesn't have near the dollar voting power that your spouse exerts. Maybe you guys could arrive at a compromise where you continue your chosen career, the two of you contribute equal amounts of $$ to raising a family, and if your lifestyle gets in the way of her desires then she's welcome to buy you out of your job?

You guys are poster children for the book "Navigating the Dark Side of Wealth: A Life Guide for Inheritors". This would be a good opportunity to hold off the spending and not make any big changes until you've both read the book and had a chance to discuss your plans with each other. Forget the financial planners-- this is a marriage challenge.

It's tough to define the life that you & spouse will live if it's based on the expectations of your parents. In that situation you have to reassure them that you know they love you and would want what you feel is best for yourselves and their grandkids!
 
Hi Flyboy,

I'm sorry for your loss.

I agree with the others - the first question I have is "What does your wife think?" I'm assuming she is at home with the kids. Maybe I'm reading into your wording wrong, but do you combine your finances? You said "she takes the money and spends it" - toward what? The mortgage and bills, or "extras"? In other words, is the $60K in income making you think like a two-income family?

At the same rate, the $1.5 million could throw off another $40K in income, giving you $100K a year. So, assuming income isn't a problem, this is really a lifestyle question for your family. You could work part-time. You could start your own business or otherwise work out of the home. Does she have any interest in working? She could work a little and you could stay home with the kids.

You (and your wife) could volunteer your time to charities that interest you.

Your children can learn from any of these situations. I think they will learn more from how you act about money and how you use/spend money than the nature of your job. Meaning, if you are sensible with your money and don't over-spend or splurge on a lot of "toys", and indulge their every desire, your kids will learn to be responsible with money, regardless of if you are working, volunteering or staying at home. And talk to your kids about money - teach them about saving and investing when they are young.

Best of luck to you.

Karen
 
1. Affraid her father would not approve of me not working (and living off his/her money)
2. Concerned it would insult my father who isn't retired and paid my way through college
3. Concerned about the what sort of example I would be setting for our children.
4. I would also like to continue to earn and save money for myself. . . "make money the old fashion way" . . . and also do not want to wake-up one day in the future to find my wife is leaving me and will be taking the /"her" money with her!
1. Your wife may have a good idea if it is acceptable to her father.
2. Ask your father. I am surprised that he is still working. Did he receive (or will he receive) part of the inheritance?
3. Good example - enjoy life when you have achieved financial indepence! It really does not matter how one achieve FI. You could do some volunteer work to demonstrate that you are making contribution to society.
4. You could do consulting or part-time work to keep your skills up to date while still have time for your family and yourself.

Good luck - many people would like to have this type of problem.
 
Thank you for the responses. . .

My wife thinks I should keep working for now.   Her main reason is "we need your health insurance."     But at the same time she wants to travel and I have limited vacation time at work and it is hard to get away.    So we are just sort of starting to talk about it.  

My wife was teaching unitl our second child was born 6-months ago . . now she is a stay at home mother.    She likes teaching, so one option I see is let her go back to teaching (almost like volunteer work) and I could stay home with the kids.    I may be running back to the office as soon as a could spending all day with the kids though!   But, I am realizing that we only get one chance at this!

Mcdaddy - no pre-nub. But I believe in Florida your personal assets you came into the marriage with are yours in case of divorce.  

Nords - - You are right, it is not his money and he has no strings attached.   I started some talking to my wife about this last night and she said "who cares what my dad thinks, I have always done things he doesn't like!"    So maybe we can cross that off the list.  

As far as my father is concerened, he fortunatley loves his job and has done very well for himself and more importantly our  family.  He is close to retiring, but would rather work.    Hell, maybe we can all RV around the country together and he can get us some of his AARP discounts!

Thanks for the book lead.    I will have to look into that.  

Kaudrey - - - My family worked hard in school and achieved welll because of the example my father set with his work ethic. He doesn't need my money.     But I like your point about finding something to do volunteer wise that would respected by our children.  

You are right, her investment income has  been like free money.   We have used it to pay off the house.  My wife can do some serious damage shopping if she is in the mood.   The shopping has stopped due to the kids and her new motherly figure with a several unwanted pounds.    We have been living like  a 3-income and now a 2-income family.   You are right it is a lifestyle question.     I need to figure out how much my personal income improves our lifestyle and balance it with the additional free time.  
 
FLBOY said:
Thank you for the responses. . .

My wife thinks I should keep working for now. Her main reason is "we need your health insurance." But at the same time she wants to travel and I have limited vacation time at work and it is hard to get away. So we are just sort of starting to talk about it.

If health insurance is an issue, do your homework and see what is available and at what cost. If you are young and healthy you may be able to get affordable insurance on the market. One place to check out is www.ehealthinsurance.com for quotes. The place for general health insurance information on your state is www.healthinsuranceinfo.net, a website maintained by Georgetown University.
 
Hi,

That's exactly what I meant! :) You are smart with money because your parents were smart with money. Your children will learn the same lessons, even if you are ERing. And it's great that your father loves his work and wants to keep working. I wish everyone could love their job that much. ;)

My parents retired at 57, and after watching them work hard and save (mom was a stay-at-home mom), and seeing what their life has been like the last 10 years in retirement - I am saving hard to retire at 52.
 
FLBOY,

You are in a financial position many here would give their I teeth to be in your shoes. Sure you have some personal issues to resolve and the advice given here has all been right on target. In the end, you and your wife have to determine what works best for you and your family. The financial side looks very strong.

One way to view your situation is to step back and ask yourself what you really want to do with the rest of your life. What is your dream job? Where do you really want to live? What is important to you now and in 5, 10, 15, and 20 years? You are in the position of being able to have the kind of freedom few every experience at your age. Financial freedom creates choices. Take the time to reallyt think and discuss what you want to do for the rest of your lives.
 
Here are two thoughts.

1. With that kind of dough, and assuming that you don't start become spendthrifts (e.g. private jet), I'd guess that you have plenty of money to cover health insurance yourself.  You could have a high-deductible plan, because all you need to be protected from is a multi-million dollar catastrophy.  So you do not need your job for the health insurance.

2. You've been looking at two alternatives: staying with your job or retiring.  A third is this: Start your own business doing something you really like.  You could become a jazz musician, although I'm not sure you've saved enough for that career.  You could become an artist, a consultant, a pro snowboarder, photographer, financial planner, etc.  That way, to everyone else you're working, but in fact (shhh, don't tell anyone) you're having fun.
 
macdaddy said:

Probably does not matter... the trust is a separate property and inheritance is separate also.. it is only the income off these that are joint.. but then again... I do not know what other states do.
 
FLBOY,
Her money / income is not yours.
Take advantage of a favorable financial environment to work hard / save hard so that YOU become FI (hopefully will be done much faster than most have a chance to achieve given your context) and ensure your savings / assets are YOURS. Then loop back to all the questions you raised and decide whatever you feel appropriate without questioning about what parents / children / whoever can think !
Cheers.
 
"Her money / income is not yours."

Excellent point. A lot of married couples end up divorced because one thinks they have a (moral?) right to the money that belongs to the other. It may start out OK, but then...resentment, doubt, feeling obligated, a sense of injustice ...sets in. Communism just doesn't work, quite often even in marriage.

If you leave your career, you are probably leaving what gives you your your 'central purpose' - your long-range goal that takes up much of your time and energy. I retired early and this is the one thing I have the most trouble with. And you are in your 30's.

Here's something that popped into my head - what if you took over the schooling of your children and your wife went back to work (if she would want that) and she paid you a salary? I can't imagine a more demanding central purpose than properly raising a child!
 
FLBoy, time to brush up on your cooking, cleaning and sexual skills. Maybe learn to converse understandingly about the poor misunderstood folks on Oprah and Dr. Phil. And keep scrupulously well groomed. Perhaps an Hugo Boss suit or two would make you appear more fetching?

Your main job going forward is to keep wifey around.

Does she like breakfast in bed? Maybe some Eggs Benedict? Best find out asap!  :)

Ha
 
What Al and Ha ha said, plus maybe throw in two words of my own.

RUN AWAY!

Spend time with your kids while they're still young. I'm not missing all kinds of precious stuff.
 
Nords said:
Welcome to the board, FLBoy!Tough one. 
....It's tough to define the life that you & spouse will live if it's based on the expectations of your parents....
sounds to me like the crux of the matter
 
What is your day job?

You may have the opportunity to take a lot more time off and still keep the job, thus keeping up appearances with FIL and kids.

You both will have an opportunity to stuff your Roths, which will take some of this windfall out of your hands and may make points with Pop.

I understand how this is a delicate family situation. You may have to move slowly if you decide to change what you are doing. Perhaps you should plan not to spend it all for a while, showing some frugality--or spend none for a while and show a lot of frugality. Good discipline and may also make points with Pop.

Remember the advice not to make life-changing decisions quickly. Consider sitting tight for a year to think it through and get used to the idea.
 
poyet said:
Her money / income is not yours.

I'll just disagree. I think the money's ownership depends on how the couple handles their money. This can only be determined by the two of them.

My wife and I share our finances. I manage paying bills, we each buy whatever we want. If there's a problem, we bring it up. If we're going to buy something expensive, we discuss it first. So if either of us had funds, we would drop them into the same pool.

So my suggestion would be to decide how to handle the funds. Are they going to be "hers", in which case you need to keep working, or will they be "ours", in which case you decide what you want to do. I assume since you're married, she'll want you to be happy, so hopefully you can work things out so that you're both pleased with the situation.
 
I am personally shocked by these numbers

Take your time, don't make major changes until the numbers no longer shock you. Since you have a new baby you may be able to take 12 weeks off for Family Medical Leave, I don't know if just haveing a baby is enough but your company may be required to hold your job for 12 weeks. This will give you some time to be home full time and see if you are bored stiff or love changing diapers and reading stories.
I think you should give it a full year to sink in and to think what to do with all that extra time.
When neither of you need to work and the kids are preschool age you are foot loose you could sail around the world or go live on a sheep ranch in Australia for a year or you could move to Montana and raise cattle or sheep. The world is wide open to you, scary isn't it?
 
I am in a somewhat similar situation although the circumstances of how the money came about are different.

I am currently 41 and retired two years ago (WOW I can't believe it's been two years already).  My wife and I came into similar numbers as yourself when she was disabled as a result of a malpractice surgery.  I had many of the same questions more than two years ago:  What would my kids think that Dad doesn't work?  Would others think I was lazy for leaving work at an early age?  Would I become bored?  Would this feel like when I was a kid during summer vacation and had what seemed to be all the freedom in the world?  Should I still work to instill a strong work ethic in my kids?  Could we afford to do it?  Would we be able to afford health insurance?

Well after two years I can say I haven't regretted the decision to leave work one bit.  We tell our kids (currently 7 and 9) Dad is home to help Mom since she can't do the same things she used to be able to do (she is partially paralyzed).  I eased into permanent retirement by working a four day 32 hour work week for about a year.  We didn't change anything for the first year after we received the settlement monies, I still worked full time. 

But two years after we received settlement I decided life is too short to live as a cubicle rat for most of the day.  The money I was making working 32 hours a week was minimal compared to our investment interest.  We have not been the least bit bored.  I have found new hobbies that I wouldn't have done if I was still working full time.  My wife and I can enjoy midafternoon rompings in the sack.  My wife volunteers in our kids school and on their hockey association.  My son loves baseball and the Red Sox so we make many trips to Fenway Park and travel to other stadiums to see the Red Sox play.  I can play catch when the kids get home from school, go swimming with them in the summertime, have many summer parties with our friends, coach their baseball and hockey teams, help out with our aging parents, etc, etc.  There are still things I haven't done that I thought I would do like taking an interesting college class.

You won't regret having all that time to spend with your kids and neither will they.  Don't worry about what others think - IT'S YOUR LIFE.  You never know what curve life will throw you, enjoy it while you can.  We still find it difficult to tell others that don't know our situation that we are retired.  We don't seem to like announcing "WE HAVE MONEY".
 
Don't discount the shock that follows receiving a large inheritance. We inherited a large sum, not as much as you but enough to change our lives. At first, it was just impossible to believe. We were bewildered by it, for lack of a better term.

We also grapple with what our parents would want us to do with the money, even though they are all gone. It's an ethical issue. My father in law made a couple of requests of us before he passed on: He wanted us to educate our kids and leave them some money when we die. So we cannot spend it all on ourselves, and we have to invest it wisely.

For that reason we are still both working until my husband is eligilbe for his pension in less than 5 years. That's not long and we are very happy about it, but we will be the only couple out of all our friends and family who will have the money to retire. We feel guilty about that.

So inheriting money is not an unalloyed pleasure. It brings conflicts, responsibilities, and negative feelings. I agree that it would help to keep working for a year or so just to give yourself time to assimilate this. I think you have a whole list of uncomfortable issues that you need to resolve before making any big decisions.
 
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