How to figure how much?

[rodeosweetheart]

This is a general post to get some differing viewpoints on family spending, for those of us who are empty nesters, with aging parents in the mix.

I'd like to get some ideas here, as I am feeling really overwhelmed by family obligations, perceived and real, and their impact on the sustainability of my lifestyle over the long haul.

I have obligated myself to give my son a part of a downpayment on a house. Which means I am obligated to do the same for the other two sons. This is okay, so long as they all don't need it at the same time, but I am giving the one the sum this year, and it is kind of freaking me out. At the end of last year, I gave another son money to move and to hire a divorce lawyer, and I am not expecting this money back. I also gave him money for my grandson's medical bills. Another son got nothing for college, because he dropped out, and I'd like to give him what I gave the others, but at least give him part of a house downpayment, if he ever gets to that point where he is buying a house.

I have also started accounts for my two grandchildren and want to add to them each year, but I am just nervous about the long range sustainability of this. It only came to a head when I needed to help the one unexpectedly last year, and when I rather grandly offered the house downpayment (why the hell did I do that, I wonder).

Then there are the parents, who are going to be requiring more travel funds and possibly moving in with us, which will mean adapting the house for disabilities, etc.

I have been accustomed to doing things like paying for their travel (the kids) to come see us, or to a family reunion, renting the space, but I think am going to have to let go of this, as well as letting go of the kind of birthday and Christmas presents I have been giving them over the past 10 years since they moved out. The bank of mom is going to have to close down, except for the house downpayment help and true emergencies. And even the true emergencies are going to have to be limited--I just cannot keep doing this.

It is not the kids--I keep offering. (What is wrong with me?)

What do you all do on this subject, to rein yourself in so that long term, you can help/give/stay involved but still not endanger your long term sustainabiliy?

Just looking for ideas and what you all do,and thanks.

They pay their own bills, etc, most of the time, anyway, and have only come to me with emergencies,

Do the rest of you obey certain guidelines--like saying okay, I will only give x percent, or how gifts and travel will be handled from now on, as I get older, and their income increases?

Thanks in advance for ideas you might have.

[TxZen]

My parents have given me zilch, not even when it was an true emergency. I am looking forward to hearing what others do as well, because I don't know what to do for my own son when he gets older. Thanks.

[catherine]

I so relate, rodeosweetheart! First of all, I was blessed with getting my undergrad paid for by my grandfather and that left me with a sense of obligation to do the same for my children at least--which I've done for the most part. Just like you, one of my sons hasn't gone to college yet, even though he's 30, but if he ever expresses an interest, I'm worried about how I'm going to make it fair and give him his just due… especially since I allowed my DD to go to an expensive private school and I'll be paying that off for years. (I'll admit that was a mistake. I should have limited what I gave her for tuition). I finished paying my student loans for her, and I've told her that I'll pay the ones in her name, until I can't. So I'm thinking, if DS30 decides to go to college, I may have to have that discussion with DD.

I have this number in my head for each of the four kids for wedding/house down payment, etc. It's not a large sum, especially considering what it costs to get married and buy a house, but it's the most that I think I can afford, and I'm pretty sure I really can't afford it. And, like you, I'm hoping everything doesn't happen at once, because no one will get anything in that case!

As for the grandchildren, yes, I was hoping to open a 529 or something for my new GS christening and try to contribute even a small amount, like $50 a month.

Thankfully, parents on both sides have passed. (that sounds weird but I'm sure you know what I mean).

So, really, I can't give you much advice, but just wanted to share that I hear ya. At this point. the kids know my financial situation and I've told them point blank that I will a) never cosign anything again, and b) I'll happily give them my present money if I have it, but not my future money. BDTD and crashed and burned. I know they'll understand, so it's really me coming to terms with my being satisfied with what I can do for them. I do think it helps to set those expectations clearly. I used to give my frequent flier miles away very generously, but I'm not traveling as much, so the last time the kids came down, I had to tell them that I'm running low and I'm not willing to give anymore out until I build up the bank. I think being as transparent with my kids about ability to fund stuff keeps me from feeling guilty.

[dmc]

I bought my kids cars and paid for their college. They are now on there own and have not asked for anything. I have sent money for plane tickets for them to visit us in Florida. I sure don't want to visit them in the winter. But that was to make the wife happy. If an emergency came up I would help them out, they are going to end up with something when I am gone anyway.

So far they have done fine on their own.

My dad is doing fine, but if he needed anything I would help him out. He also bought me cars and paid for my college when I was a kid. And I always knew that I was always welcome at home if for some reason I couldn't make it on my own.

[sweetana3]

My parents gave us the ability to go to college. One of us completed the work. They did this because they refused to fill out the financial aid application. We went to state schools and chose the most affordable option. (It was 40+ years ago).

Over the 40 years, my brother may have borrowed a little as he was the least responsible with money. They paid for the $500 wedding I had 42 years ago. Other than that, we were considered self supporting and we all were. They left us what was in the accounts when both died but if zero, it would have been fine. To this day, I am glad that I had to work for what I wanted and learned the value of saving and patience.

We have friends that are spending their funds on their three adult kids and grandkids. All the kids are self supporting in dual income families. I hope the parents have enough for retirement. A fine balance is needed.

Best thing to do if you have multiple kids is to have a serious conversation with them.

Forgot to add that we have always helped out my husband's parents. They lived on very little (had little education and minimum wage jobs) but stretched it very far. We have taken them on vacations, helped them buy a little house, paid their real estate taxes, and now give money each month to his mother to help her out. This is really because we make 6+ times more than she does and does not cause us any hardship.

[dmc]

But you also have to take care of yourself, unless your certain that the kids will help you if needed. If the kids are not asking, why are you offering if your worried that it might put you in a bind? Save the money until a true emergency comes up or your sure you won't need it.

[catherine]

I've kept this article in my desk drawer ever since I ripped it out of a Family Circle magazine in November of 1977. I was pregnant with my first son at the time. I think has stood the test of time


What Do Parents Owe Their Children?
By Ann Landers
If I had to select a word that best describes the majority of American parents that word would be guilt-ridden. It's often sad to see parents becoming the willing victims of the "give-me-game" only to discover that, no matter what they do, it's not enough. Finally they are despised for the lack of firmness and blamed when their children get into trouble. With this in mind I’ll try to answer the question: "What do parents owe their children?", but I'll start with what they don't owe them.
Parents don't owe their children every minute of their day and every ounce of their energy. They don't owe them round-the-clock car service, sing¬ing lessons, tennis lessons, expensive bicycles, a motorcycle or a car when they reach sixteen, or a trip to Europe when they graduate.
I take the firm position that pa¬rents don't owe their children a college education. If they can afford it, fine: they can certainly send them to the best universities. But they mustn't feel guilty if they can't. If the children really want to study, they'll find a way. There are plenty of loans and scholarships for the bright and eager who can't afford to pay.
After children marry, their parents don't owe to buy a house for them or give money for the furniture. They don't have an obligation to baby-sit or to take their grandchildren in their home when the parents are on vacation. If they want to do it, it must be considered as a favor, not an obliga¬tion.
In my opinion, parents don't owe their children an inheritance, no matter how much money they have. One of the surest ways to produce a loafer is to let children know that their fu¬ture is assured.
Do parents owe their children anything? Yes, they owe them a great deal.
One of their chief obligations is to give their children a sense of personal worth, because self-esteem is the basis of a good mental health. A youngster who is constantly made to feel stupid, constantly compared to brighter brothers, sisters or cousins, will become so unsure, so afraid of failing, that he (or she) won't try at all. Of course, they should be corrected when they do wrong — this is the way children learn. But the criticism should be balanced with praises, preferably with a smile and a kiss. No child is ever too old to be hugged.
Parents owe their children firm guidance and consistent discipline. It's frightening for a youngster to feel that he is in charge of himself; it's like being in a car without brakes.
Parents owe their children some religious training. The fact that so many strange cults are enjoying such suc¬cess is proof that children feel the need for something spiritual in their life.
Parents owe their children a com¬fortable feeling about their body, and enough information about sex to bal¬ance the misinformation that they will certainly get from their friends.
Parents owe their children privacy and respect for their personal belongings. This means not borrowing things without permission, not reading dia¬ries and mail, not looking through purses, pockets and drawers. If a mother feels that she must read her daughter's diary to know what is going on, the communication between them must be pretty bad.
Parents owe their children a set of solid values around which to build their lives. This means teaching them to respect the rights and opinions of others; it means being respectful to elders, to teachers and to the law. The best way to teach such values is by
example. A child who is lied to will lie. A child who sees his parents steal tools from the factory or towels from a hotel will think that it's all right to steal.
No child asks to be born. If you bring a life into the world, you owe the child something. And if you give him his due, hell have something of value to pass along to your grandchil¬dren.

[rodeosweetheart]

But you also have to take care of yourself, unless your certain that the kids will help you if needed. If the kids are not asking, why are you offering if your worried that it might put you in a bind? Save the money until a true emergency comes up or your sure you won't need it.

That's what I am thinking about--why AM I offering? I have to figure that out. As you say, I want to be able to help in an emergency, but realistically, maybe all I can offer after a certain point is a place to land if they need to temporarily.

Thank you all for these answers-- so many good points, and I think you are all raising the points I have been pondering. I definitely want to give them what my parents gave me, and also help my parents in future. I'm not doing much beyond what my parents did for me, along the line--I had to borrow money from my mother to pay for a divorce, for example, though I paid her back. Our college educations were paid for by parents and grandparents via inheritance. I want to keep things fair among the children, and I want to do things for the grandchildren, like the 529, because my grandparents did things for us.

I've done the things like plane tickets to let them visit when they were working terrible jobs--as much for me, to get to see them, as for them, I guess.

Catherine, I really, really like what you said about only using present money, not future money. That is so important, I think, and why I am bringing this up. I have to scale all of this to whatever I can afford now but also in the future, and now times 3 kids. I have to figure out a line item budget for family, and then stick to it.

Really, what I want to do is to scale back our lifestyle right now so that we can move into retirement at some point at the lower level of expense--to get used to it now and to make it sustainable, so that the retirement years are fulfilling and don't feel like deprivation. And looking at what we spent this year, what jumped out was how much we spent on our two families, and that we can't continue at this level of spending.

[rodeosweetheart]

Thank you, Catherine for that article--that is really nice, and I needed to read that right now.

[Float On]

My parents feel that everything has to be equal. If they send me $500 for some emergency, they also send $500 to my brother even though he does better than all of us.
I don't know if it's because my brother and I argued a lot while growing up (both of us threw out the "it's not fair" statement way too much) but my dad has a ledger he has kept of all moneys invested in the kids to "keep it fair". They've even figured out how to divide the farm between the two of us to keep it fair after death.

My husband comes from a wealthy family and his three siblings did a lot better than we did. His mom has helped us a lot but not offered the same to the others because of how well they've done. She did invest $5000 for each grandchild at birth and that is basically all the grand kids have rec'd to this point. I don't think there has been any hard feelings from his siblings about the amount of money that his mom has helped us with, there are no charts or "keeping things fair" like my side.

[iris lilies]

But you also have to take care of yourself, unless your certain that the kids will help you if needed. If the kids are not asking, why are you offering if your worried that it might put you in a bind? Save the money until a true emergency comes up or your sure you won't need it.

Like. :laff:

Seriously, for people at ANY economic level, put on your own oxygen mask first before trying to save your children.

If you (the generic you) are financially set for retirement, I think it's great to help out your 20 something kids with vacation tickets, house down payments, etc. But if you aren't there yet, remember that you've already done your job by launching them out into life with skills and presumably some sort of formal education. And if you can offer your parental home as the place where they can land if they crash & burn, that is generous. I would say pretty much the same thing for supporting elderly parents.

The Millionaire Next Door has quite a lot to say about "economic outpatient" help for adult children, and it ain't pretty.

The Mr.Money Mustache forums discuss this pretty often, although those guys are fairly young and they have the problem of supporting parents, and often parents who have lived large and then crashed and burned. Probably those parents are my age, ugh, how awful to burden one's children in this way. Since the MMM board if composed of international members, there is a fair number of non-Western attitudes about the elderly, and many grandparents just take for granted that the youngsters will support them.

[iris lilies]

I will also say that my mother said regularly and clearly "We are paying for your education, that is your 'inheritance.' " The clear communication was very good in keeping expectations in check.

There was no notion of tit-for-tat that if I didn't go to college, I would get an equal amount of money. It was education or naught. And that said, they DID give a few cash handouts to us over the years, entirely voluntary on their part, and I got a tidy little sum at her death, but since all of that equals only 3% of our total net worth, it's not as though I got rich with family money.

[iris lilies]

Why are you even thinking about paying for houses and weddings? These are not NEEDS they are WANTS.

[ApatheticNoMore]

If you give money to your kids it should definitely be equal amounts (and yea even the kid that doesn't go to college - eventually - maybe don't let them on to that right away :) ). Yea people say the kids who have done better financially (and remember better is relative) don't' resent getting less. But actually it's like an incredibly forcible punch to the gut, so that frankly giving all the kids nothing would be better.


And if you can offer your parental home as the place where they can land if they crash & burn, that is generous.

it's a whole lot.

[iris lilies]

If you give money to your kids it should definitely be equal amounts (and yea even the kid that doesn't go to college - eventually - maybe don't let them on to that right away :) ). Yea people say the kids who have done better financially (and remember better is relative) don't' resent getting less. But actually it's like an incredibly forcible punch to the gut, so that frankly giving all the kids nothing would be better...


It might be, depends on the family and sibling relationships. In our families, probably because there was always a stated effort to be "fair" that there are few resentments of distribution of money.

One thing is going on right now in DH's family. DH's father has, at the moment (because farmland is valued high) a lot of wealth. He is paying for complete replacement of his grandson's teeth. Grandson is a former meth-head.

I think that is great use of his money. This child was sort of a lost soul, the kid was dealt a bad hand in life by getting a skanky mother and a father who didn't save him from that soon enough and then, the kid ended up with an evil step-mom. But I digress. All of his peers, his cousins, had great parents. I suspect that everyone in the family thinks it is the least anyone can do for this young man, to give him expensive dental work.

But I also know of plenty of sibling situations where the chronically irresponsible child gets never-ending economic help from parents and siblings resent it, as they should. So many times this kind of thing ends up bankrupting the helper parents. It's a common theme on the MMM site.

[rodeosweetheart]

APN, you are right, that is a lot, that they know they are always welcome if they need a place to land and regroup.

IL, I read The Millionaire Next Door, too, and the economic outpatient stuff is part of what I am taking into consideration--it sure seemed to hurt, rather than help, didn't it. I sure don't want to get into that syndrome, like some of those families in the book! No chance I'd have that much to give them, anyway, lol. Like Catherine said, it's present, not future, money only.

I think I want to do what my parents did, what their parents did. I'd like to feel I have a hand in my grandchildren's long term prosperity, even if it's more symbolic than anything else! When my son went to college in 2000, he cashed in savings bonds that his great aunt had gotten for him at birth--it meant a lot to me. That't the kind of thing I am going for here, not the economic outpatient stuff, God forbid.

Some of this probably has to do with wanting to pass on what other generations did for me, to feel connected to the larger pattern of the family taking care of subsequent generations.

But I have to make adjustments based on the realities of my own economic circumstances, and I am definitely going to have to cut back on things like Christmas and tickets, so that I will have enough for more important things.

Although I really wish I could just fund a family reunion every year, wouldn't that be nice.

And I really admire those of you who are taking care of elderly parents. That is a good thing, I think. Have finished with weddings and college, so nothing to worry about there, thank Goodness.

[Teacher Terry]

When i was married to the kid's Dad we paid for college-all 3 had a chance to go. Once we divorced my salary could not afford it so when they decided to finish college as adults I gave them a free place to live & fed them. They took loans to finish school. I have helped the kids as they need it so different amounts to different ones at different times. Only my oldest is married & we gave him $3,000 towards wedding. When they were in their 20's I would buy plane tickets for visits but now they range in age from 35-41 so I don't. One of my boys I have had to quit helping because he has a drug addiction & now I won't let him live with us because when he is using he steals, etc. My oldest son & his wife will live with us for a year so they can save $ for down payment on house but they buy their own food so not really costing me anything. Once my Dad died my Mom lived on the part of his pension that was left & it was very small. She would not take any $ from any of her 3 kids. However, we could treat her for gifts & she would even accept an expensive vacation so that is how we all helped her.

[razz]

When our two girls were around sixteen years of age, I had seen a horror example of family financial obligations run amok and the parents suffering enormously. After talking it over with DH, we agreed and advised them that we would give the girls a lump sum towards their wedding and as much as we could afford beyond the tuition for their education, nothing further!!!
That was what they were able to plan for and advise their partners when they entered the picture. Saved a lot of grief. When I sold our farm after DH passed away, I gave the two an inheritance from the proceeds for the two girls only. The balance was mine to use as I saw fit. If there is something left after my demise so be it. If nothing, so be it. Both families are content with the full disclosure from the get-go.

[Zoe Girl]

i am in a different situation, i really hope i can help my kids and i am doing better financially for the next year. in a year child support is over and i will face a serious drop in income. So i am putting aside as much as possible for that and to help my kids. over the last several years i have put money and effort into various mental health things such as counseling and psych appointments. my parents have helped me and i know they have not sent the same money to my siblings. i am perfectly fine with that, My brother owns rental properties, his kids will go to college, his house will be paid in 15 years. i work in social services, got divorced, and am very frugal with what i do get from my parents. my parents don't owe me anything and i would figure out things on my own, but in my buddhist practice there are things we learn about generosity, both giving and receiving. My mom at least is pretty supportive of the work i do and even my buddhist practice which includes supporting others. So i gratefully accept that i will never come close to earning what my brother does, it has been a HUGE struggle in acceptance honestly, and that often people have offered support in various material ways that allow me to keep doing the work that i do. i wonder if this is off topic by now.

So i am thinking about starting accounts for all my kids and put in money monthly. i already get savings bonds every year with part of my tax returns in their names.

[SteveinMN]

I think the answer to your question is that "nothing is constant but change". We always are in changing circumstances, and even well-laid plans need to be altered based on unforeseen circumstances.

Over the last few years, we've made it clear to everyone -- family, friends, etc. -- that we are finishing our big earning years and preparing for retirement ourselves, so we are on pretty much a cash basis now. We asked DD and SiL what they wanted as Christmas gifts and told them right out that, while we were happy to consider some of those items, we weren't going into debt to provide gifts. This, of course, comes after we gave them a substantial amount of money last year for their wedding (another thread in this forum). When our friends decided last year to go on a cruise this year, we agreed to go, stating up front that we were not "buying up to keep up". If one of our moms had a sudden financial need or something big happened with DD/DSiL, we'd figure out what we could do and do that, feeling okay about our involvement and not fearing for our own future.

We probably would not have done the same were I still making what I was at my old job (or, presumably, more, assuming promotion/raises). But life changes. There's nothing wrong with a cash-only ethos at any point in life, but it would be easier to sidestep that had we been able to rely on future earning power and credit. We assume none of that now. It might be time to have a frank conversation with your kids and find out if you all are on the same page regarding expectations and abilities.

[Glo]

Lots of parents fund their grown children's problem. Some of this results in parents being unable to retire. Close the bank. They are adults with adult problems, which they need to solve on their own.

[rodeosweetheart]

I think the answer to your question is that "nothing is constant but change". We always are in changing circumstances, and even well-laid plans need to be altered based on unforeseen circumstances.

... But life changes. There's nothing wrong with a cash-only ethos at any point in life, but it would be easier to sidestep that had we been able to rely on future earning power and credit. We assume none of that now.

Right, this cash only thing is what Catherine is saying with the present money, future money. That is where I am coming down on this, while still trying to, as one Boglehead poster put it, "invest in family growth and possibilities for each individual." I think that is what i am trying to do, while maintaining the boundaries, or even figuring out where the boundaries are now and will be in the future.

They have definitely shifted from several years ago. All my kids are grown now, so they are launched, and no one is funding their problems, as Glo put it. Not at all. and she is right, you definitely never want to do that!