You, Your Parents and The Money
Posted by Gail | Filed under Money & Family
I’ve been getting a lot of questions recently from people who are concerned about their parents’ ability to make it through retirement independently. These are people who are watching their parents make some big mistakes and wondering if they’re going to have to step in to help later on. Or they are people to whom parents have turned for help who don’t think they can manage it. Or people who have tried to help only to be rebuffed or ignored.
If you’re financially responsible but have relatives who are not, it can be hard to watch them constantly battling with the consequences of their mistakes. It’s sometimes a case of “the child becoming father to the man.” And it’s sometimes a case of “I ain’t going down that road baby. No way.”
It doesn’t matter how you came to see things so differently, it can be tough to watch the people you love totally screw up their lives. Sadly, that’s all you can do. If you’ve got the resources to help, no doubt you’ll do your best. But for many people, helping parents or other relatives means doing less in your own life – be it less saving or less enjoyment from your money – and that can be a hard pill to swallow.
If this is something that you’ve been thinking about, the place to start is by asking yourself what it is you fear for you parents. Do you worry about them running out of money? Becoming frail and dependent on you? Asking you for money when they just end up blowing it on dumb stuff? Think about it. Talk to your partner. Face the fear(s) and you’ll find it easier to deal with whatever comes next.
Sometimes parents can be remarkably closed when it comes to their money. That’s fine if they’re planning to remain independent. But if they tap you for money every time they run into trouble, or because they don’t have a plan, then you have the right to know what’s going on.
If your parents have assumed you will take care of them – after all, they brought you into this world and supported you for the first 16+ years of your life – are you on the same page as to how you will do this? Will you assume full financial responsibility for them? Will they live with you? And how will you balance the need to care for your parents with your children’s needs and your own retirement savings needs?
If one of your parents has had all the control over the money, how will the other deal when the money manager finally kicks the bucket? Your mother won’t be the first woman left high and dry because her husband didn’t have a plan that took into account her longevity. And if your father has left it all up to your mom, will he have clue one when she’s not there to do the detail anymore?
Have your parents made any plans for when they may need help physically or financially? Do they have advisors you trust? Do they have enough and the right kinds of insurance?
It’s not easy to have this conversation with parents, particularly those who are financially private or those who are financial nit-wits. But you must. At the very least you should have a sense of your parents’ expectations, and they yours. If everyone knows where everyone else stands, there won’t be any surprises down the road. And that should cut down on the whining.
At the very least, make sure your parents have wills and have executed both financial and personal care powers of attorney. If they haven’t, and the worst does happen, you won’t be able to help because they will have tied your hands behind your back.
August 26, 2010 at 7:02 am
Wow, that is a lot of good questions. I worry about my father running out of money in retirement. I’d love to see him downsize the house he is in now to something smaller and cheaper, hopefully to something inexpensive enough that he can left without a mortgage.
regards,
Jason
August 26, 2010 at 7:39 am
My parents have all their ducks in a row…my dad never had a company pension plan so they saved it all themselves and still enjoyed their life…they are still in their new home but realize an apartment may be on the horizon…they always travelled, raised 4 kids very well, drove a nice car etc…no debt, enough money for retirement to maintain their standard of living…and all of this by saving their own money from my dad’s paycheque…my mom always stayed home with us kids…this is just one area my parents are a great example!….
August 26, 2010 at 7:39 am
p.s I stll can’t vote on the poll:(
August 26, 2010 at 7:43 am
My parents have always been careful with their money, although they lost a lot in the 80’s in the stock market along with many others. They scrimped and worked hard to have their ‘dream house’, and then sold it at retirement. My dad is often consulted by other’s regarding retirement and pensions, and ensures that his company pension plan follows all the rules and looks out for everyone’s best interest. When he retired at 50 (he took a buy-out package), he knew that it wouldn’t be enough for him to live off of for the rest of his life, so he got p/t work in the States, and can now collect pensions from both Canada and the U.S. He also teaches p/t. I would say they have their finances under control, and I am very relieved and thankful for that.
The one thing that bothers me right now, is that they are considering rewriting their will to provide for my niece, and setting up a fund for her… I think it would be more productive to get her to get a job and actually try something on her own… she did finish a college program, and graduated high school, so I believe that she must have SOME skills to be able to make a living… Don’t get me wrong, I could care less about getting an inheritance, but I hate seeing my parents, who worked so hard, instead of enjoying their money, saving it for their grand-daughter…
August 26, 2010 at 8:18 am
My Dad and FIL are retired (Dad for 10 years, in-laws for
and all are doing fine. Dad and FIL both worked for companies that offered pensions, so that eases the financial issue (my MIL was a stay-at-home Mom since before they immigrated to Canada). My Mom and Step-Dad were retired for a couple of years, but Mom decided to take the reigns of their business back from my step-brother because Mom was “bored”! She loves to work and keep busy; we joke she’ll work until they put the final nail in the pine box.
I don’t worry about any of them being able to financially look after themselves. As far as their health goes, because none of them carry debt (or very little of it), it should be reasonably smooth sailing. My biggest concern is for my Dad; he lives in a 1-bedroom rental apt., and no real estate to sell and use towards moving to a retirement home should the need arise. His pension is pretty good, but he’s not one to plan ahead… “ignorance is bliss” is his motto. I try to bring up the subject on occasion, but he’s one of the “financially private” people Gail mentioned. One day, he won’t have a choice… he’ll have to open up.
August 26, 2010 at 8:53 am
I fixed the poll so you should be able to vote now.
August 26, 2010 at 8:59 am
This is something I’m only half worried about. My mother has done a fantastic job of making sure she is set for her retirement….though she can’t retire until she’s 65. She takes care of my grandparents now – who have also done a great job of making sure they are set for retirement.
The trouble is my father. Same age as my mother, 1 ioda of the financial sense she has. The bigger issue is that he isn’t close to me at all, though is very close to my sister, and thus has imposed some of his “financial wisdom” onto her. So I worry about both of them really. Later in life I can see financial strains in the family for both my mother and I when it comes to the rest of my family. My sister has the sense my mother gave her, but it’s easier to live like my father and not do anything for later. A real case of laziness. And although we joke now – my sister will look after my father, and I my mother, I have a real sense that it will be more like me looking after everyone including my sister. I’m working to rid myself of my debt now so I can build the life I want for myself, and have the versatility to offer guidance to my family, but not money.
August 26, 2010 at 9:05 am
Does anyone have an opinion on whether you should help a sibling financially, particularly one who has never shown much inclination to work and who has instead relied on hand-outs from the government (welfare) and parents for decades? I’m talking about a sibling who is 50.
August 26, 2010 at 9:21 am
My parents also are people who have worked and saved and my mother is very frugal. Their retirement will be fine. My worry is that my mother is SO frugal, she doesn’t believe in having to pay for any services she may need ie: home support for house keeping, homecare nursing, etc.
I envision a future of secretly paying for things or working myself to death to help them.
August 26, 2010 at 9:22 am
We are lucky, both sets of parents are retired and fully independent financially. They planned out their retirements and don’t need any financial help from us, at least not right now. My parents have been retired for 21 years already, my in-laws have been retired for about 6 years now. If we do half as well as they’ve done, we’ll be doing great!
August 26, 2010 at 9:34 am
I’m not worried at all about my parents. They are savers, they have been excellent financial examples, and after a painful debacle with my grandfather’s will, my parents have been even more diligent about making sure their affairs are in order, despite the fact that they are relatively young (57 and 60) and healthy. That said, if they ever hit a snag they couldn’t manage, I would be first in line to help them out as best I could. They were always 100% there for me when times were tough (while encouraging independence) and I would do it for them in a heartbeat.
My inlaws on the other hand, couldn’t be more different. My sister-in-law and I worry constantly (the brothers we’re married to are kind of fatalistic about the situation) and discuss what we’ll do when…(fill in multiple possibilities here). FIL is already retired with a decent pension (he made more on pension that my husband made working FT a few years ago!) and MIL was a SAHM. They are constantly in debt, living off their LOC. Their house, while paid for, is essentially unsellable-we’ll have to tear it down in order to sell the property if they die there-and they have no other assets to speak of. MIL thinks her extensive collection of costume jewellry and badly stored antiques will be our “inheritance”. MIL doesn’t drive and can’t live where they do (very rural) if FIL is unhealthy or dies, but she refuses to move anywhere now, despite FIL wishing to leave their difficult to maintain home. The list of issues goes on and on. Neither SIL or myself could tolerate her living in our homes (my sanity and marriage would be shot in record time) so we’ll have to pay for her to live somewhere if FIL goes first. Terrible thoughts to be having, but I know its inevitable. Sigh…we’ve tried to raise the issues with them multiple times, but his mother is too proud to discuss it, and too stubborn to realize what could happen. My only blessing is that SIL is on board with me with this issue-misery loves company!
August 26, 2010 at 10:35 am
This is a huge concern for me.. I was raised by my maternal grandmother and her second husband (they are Mom and Dad for all intents and purposes). Although they raised seven kids before I came along, and another grandchild along with me – I know that it will be my responsibility to take care of all their expenses within the next five years (outside of meager RRSP’s and CPP). They put me before their retirement, and I feel the need to ensure that they can retire comfortably after all they have done for me (not that it is expected). Nobody else in my family is in a position to help. So now I am working full-time, consulting 20 hours a week, and technically a full-time university student in preparation.
August 26, 2010 at 10:43 am
My parents always said the best thing they could do for their kids was to to take care of themselves so they have their money set and will get the care they need when the time is come. My parents have kept their finances seperate so they both can manage should the other perish. However, not my MIL and FIL. They have plenty but if he should go, she won’t necessarily know what to do, she’s not dumb he’s just controlling. Hopefully, she can learn.
To the one with the 50 year old moocher, don’t let him mooch off you!
August 26, 2010 at 11:18 am
Boy oh boy does this one hit home.. My 60 year old MIL used to be financially independent (never financially smart but at least paying her own bills) Through a series of bad choices she has now wound up with no house no savings no income and to sick to work.. she does qualify for disability pension which is adequate to cover the rent on her subsidized housing and her essential expenses but she chooses to spend how she wants and then expects my SIL to make up the difference. My SIL can technically afford it (we refuse to give her money) but it makes me crazy that she hands over the money with no conditions or stipulations. My MIL’s excuse is that it’s impossible to live on what she gets from the government each month.. it’s only impossible if you spend beyond what you can afford
Now my MIL’s health has reached a point where she can no longer live on her own.. she will need to go and live in a nursing home. Since she has no money/savings she will need to go into a home that offers subsidies from the government. That means she has to wait and live in the hospital until a bed opens up- could be up to 2 years before she is placed… The social workers asked her if she could live with family and she said they won’t let me.. that’s right..because her behaviour is so completely destructive that we refuse to let her live with us.. I have sympathy for her that she now at 60yrs of age has to go into a nursing home and will have to spend months/years waiting for a spot but sometimes the consequences of our actions really suck!!!
It might sound like I am uncaring and callous but we have learnt over the years that the only way to survive with her is to have boundaries and stick to them. otherwise your life as you know get’s totally torn apart as you know it!!
I pray that I do better so my kids don’t have to go through this…
August 26, 2010 at 11:35 am
Ann:
I have limited compassion for those who could but choose not to. I know enough people who had real bad luck to know whom I would help first. I would offer tools and support to make things happen, but not money.
Wasn’t there a case (US or Canada) where the parents were successful in court to get $ from their children for support? That kind of stuff scares me. Why should I be careful with my money if it can be taken away from me?
August 26, 2010 at 11:51 am
This is such an important issue. It is not the children’s responsibility to financially support their parents or adult siblings. Taking a parent or in-law into the home can destroy a family or at the least cause great difficulties. When you marry you do not become responsible for your spouse’s relatives and your partner shouldn’t expect you to bring them into your home or use family funds on them.
However it may be necessary to help parents get their paper work in order regarding wills, powers of attorney, government pensions and subsidies. Children may also need to help their parents research retirement communities or long term care facilities. Support can be given by choosing appropriate birthday, Christmas, Easter gifts, etc. such as clothing, consumables and other necessities.
August 26, 2010 at 11:53 am
I love the photo posted with this article!!!
August 26, 2010 at 12:05 pm
@ Ann – you can’t help those who aren’t ready to help themselves. Focus on someone who deserves your help.
August 26, 2010 at 12:20 pm
Actually reading your post-like many others-this one really did it in for me, I actually got really scared because I’m afraid one day my mom will come knocking on my door asking me for a place to live (she is a recovering alcholic with nothing to her name). I’m 26 with 3 children of my own, I know that family is important but I never would of thought that I would have to become responsible for her when she’s got nobody but herself in her life and her children. Since I’m more responsible with money than any of the other children, I’m just afraid to think that this could happen within the next 15 years of my life. She’s already a little frail and can’t work because of what the alcholism did to her body for the past 15 years.
I’m seriously scared for the future because when we finally have things settled in our lives does my mom come and shake it up for us?
August 26, 2010 at 1:19 pm
I recently had to help my mom with her finances when my dad passed away. I was pleasantly surprised that things were in order. My dad had a plan, deferring some of his pension up front so my mom would have more in the event of his passsing. Nice job dad! I helped clean up any credit cards debt, and now she is saving money each month and doing all the things she wants.
My in-laws have also been budget savvy. I have no worries there.
August 26, 2010 at 1:19 pm
I understand where some people are coming from but I’ve invited my mother to come live with me, since she is critically ill and must be close to major hospitals. My husband does not have a problem with it. She will help out financially in ways of food costs, etc. but she couldn’t afford an apartment on her own. Maybe it’s because my mother is sick or because she has given so much of herself to her children that I feel the need to look after her now in her time of need. I figure my parents clothed, sheltered and fed me for 20 years so why can’t I? Most seniors I know that are cranky etc. are lonely and need some comforting. I think as a society today we are very selfish.
August 26, 2010 at 1:24 pm
@Linda: I agree with your suggestion that support can be give with appropriate Christmas / birthday gifts if a child or sibling is interested in “helping”.
I don’t have any concerns with my parents but my sister’s financial situation makes my stomach churn. I don’t agree with many of the choices she has made that has put her in this situation and we all quietly agree that giving her money will not help the situation, it will only prolong it.
Having said that, I am happy to take their kids out on the occasional clothes shopping trip to help out. Gift certificates also make good presents if one is so inclined. The decisions made by the parents are not the kids fault.
If I had a parent in a similar situation I think I would be more inclined to bring over groceries or other necessities (if I felt it was warranted) rather than giving any cash. I think giving money is a dangerous thing to start. But perhaps picking up some extra meat or meals for their freezer when out shopping is a way to help? I would never continue to do this if I started to feel resentful though. I don’t think that is beneficial to anyone.
August 26, 2010 at 1:28 pm
@Andrea: I think it all depends upon the situation with your parents. When I hear Connie’s story I really feel for her. I imagine if one has an alcholic parent that there have been some very rough times in the past. Bringing that into her family home could be very detremental to her kids and her current family dynamics.
I do hope that Connie can get the help from a co-op housing group or other agencies to help her Mom if it is needed – It doesn’t sound like moving in with her would be healthy at all.
August 26, 2010 at 1:39 pm
Bleah–this one kind of hits home for me. My mom didn’t blow huge wads on stupid stuff or anything like that, but she works low-end, menial labour jobs and has never put money into RSPs or savings of any kind. She does not own property. She is 55 years old, and I wonder how she is ever going to be able to retire. I have tried to talk to her about it, but she just says she’ll work till the day she dies. Great, but who wants an 85-year-old working for them (no offense to the octogenarians, but really)? She has no money to pay for an assisted-living place if she ever needs one. I guess she figures she’ll just drop dead at work before it ever becomes an issue. But she is a smoker, so cancer is a major worry for me. She is pretty healthy for someone her age, I admit, but stuff happens and she hasn’t planned or put away for any kind of contingency. And I can’t afford to care for her any time soon. I hope her carefree, careLESS attitude does not come back to bite us on our bottoms.
August 26, 2010 at 2:25 pm
Wow, did this post ever hit home for me!
My husband and I have been married for 24 years and have spent all of those years watching his parents dig themselves deeper and deeper into financial trouble.
We got the first phone call asking us to pay the in-law’s debts 2 weeks after we were married. The first few years we were sympathetic and tried to help but our advice was rebuffed, the assistance was squandered and they always ended back where they started, in dire financial straits.
Many years later, FIL turn 57 and the bank gives them a 25 year mortgage…REALLY???!!! Do they really think with his financial history and age that he can continue to pay that mortgage until he is 82 years old???
We finally try to intervene, when FIL turns 60, and sit down with the in-laws and BIL to discuss making some changes to plan for retirement. BIL sides with parents and insist that “Dad” will work until he dies so there are no worries.
Three years later, they hit the wall. The house is foreclosed and in trying to settle the issue a whole host of other problems surfaces. Seven years of unpaid income taxes, two vehicle repossessions, unpaid house taxes, unpaid utility bills to every utility imaginable and several bills from collection agencies are discovered. Then to top it all off, in-laws are evicted from rental home for 9 months of unpaid rent.
It takes 3 years of negotiations and paperwork to find a resolution to all of the debts but they are finally debt free with a decent place to live.
Then, disaster strikes. FIL is diagnosed with dementia at age 67 and he is no longer able to work. The disease progresses rapidly and with only FIL’s Old Age Security and a small amount of CPP to support them, they are, once again, in dire financial straits.
We again step in to help and, because they have no pensions, no assets and not one single penny in the bank, are able to obtain the Guaranteed Supplement for them.
FIL, at age 70, is admitted to a senior’s care facility and must pay 80% of his $1500/month income to pay for his care. The final 20% of his income must pay for his incontinence supplies, medication, clothing, personal care items and services (haircuts, dental work, glasses, etc.). If you know anything about senior citizens, you will quickly see that 20% of $1500 won’t cover even a small portion of those items. We are, again, required to step in and help.
MIL, at age 66, now has to try to live on her own with a monthly income of $1400. She refuses to move to government subsidized accomodations (there are several very nice apartment options in her city). She says that she doesn’t “like” living in an apartment and expects us to purchase a home for her.
The moral of my story; if you think your parents, in-laws or other family members are living a financially unsustainable life, don’t be nice and try to keep the peace. Discuss your concerns, candidly, with them and say that you are willing to share your ideas for a better financial life with them. If they are unwilling to listen and/or continue on their merry way, tell them that you will not be responsible for their problems when their world falls apart and they can’t help themselves anymore. If you don’t have this discussion with them, like our family didn’t, you will end up in a very difficult positon. Do you help them and your own family suffers financially or do you ignore them and deal with the guilt that you may be abandoning them in their old age?
August 26, 2010 at 2:36 pm
NorthernBCMom, where is the BIL in all this mess?
August 26, 2010 at 2:58 pm
@Andrea
When people choose to have children it is their responsibility to feed, clothe and shelter those children. It is also their responsibilty to provide for themselves in their old age. If their offspring wish to help out it is a bonus, but they are not obligated to do so.
The children are not selfish because they choose to protect their own marriage, children, future, and often their own physical and emotional well-being.
And, it should not be implied that they are selfish for doing so.
August 26, 2010 at 3:11 pm
I’m so grateful that we didn’t have to go through this mess when my dad died.
I wouldn’t have been up to this emotional at the time, but it would have been something I would have taken care of if needed.
My mom is doing a great job managing the money and seems to love gardening more and more.
She is house bound because she never learned to drive which is about the only problem she is facing at the present time.
I’m very proud of her because she never managed the money at all and has taken over the job perfectly.
August 26, 2010 at 5:06 pm
@Marie
BIL (who lives in the same community as in-laws while we live 300 kms away) is not interested in being involved. He plows their driveway or chops wood a couple of times a month and considers that his contribution.
August 26, 2010 at 5:41 pm
@Flynnycat – Surprisingly, if your Mom worked lower end jobs and had quite a low income throughout her life than she may have been better off NOT saving in her RRSP. This is one of the great problems with the RRSP is that for low income people they may ultimately have their supplements clawed back in retirement due to the RRSP income, and the deduction isn’t worth it for them.
That said, there is nothing wrong with putting some funds away in a regular bank account or now a TFSA.
Others may be better able to comment on the specifics, but if your Mom has lived on a relatively low income her whole life, you may find that her income in retirement is not substantially different. It might be worth looking into what she will be entitled to, as it may take some of your worries away.
August 26, 2010 at 5:52 pm
These posts make my blood run cold. It’s shocking to see that people can be so ignorant and naive about their futures. Like being 60 years old and really thinking that you’ll never get sick and that you can feasibly work until you die. Unfortunately there are SO many stories like this, and I know some people very close to me who have had to deal with some very similar situations. I think that NorthernBCMom gives the best advice that can be given – to speak candidly about your concerns, even if it upsets the family, and like Linda suggests, recognize that you don’t have the responsibility to clean up others’ messes. Of course, when it comes to family drama, it’s easier said than done…
August 26, 2010 at 6:02 pm
Thank God my parents have always been super-responsible and frugal. They make more money in retirement than I am currently earning at the height of my career! They have pensions, RRSPs, and a huge stock portfolio. I am not worried about them at all. My partner’s parents are similarly responsible and financially stable. The only fly in the ointment is my brother, who isn’t very good with his finances, but he will hopefully inherit money from my generous parents to help him out.
August 26, 2010 at 7:15 pm
My parents are absolutely fine. My grandparents were one of the scenarios that Gail is talking about, Nan and Pop were married for 72 years when Pop passed away, she was always a SAHM to four children.
He took care of ALL of the money, kept a close eye on everything and denied her several things that she wanted over the years, a sun room extension on their house, one of those chairs that lifts you up without you having to stand….
When he passed away Nan went through the money and saw that they had so much money it wasn’t funny, there was almost 100k sitting in a PASSBOOK account earning about 1% interest!!! She was livid. She went out and spent money on that chair straightaway…
It is not a bad ending I guess as she had more than enough money to last her til she passed away two years later, but she always got upset thinking about all the times Pop told her no for something she needed, he made her get a second hand walker and wheelchair….
S
August 26, 2010 at 7:31 pm
Both my parents and my In-laws spend money like it was stolen and are deep in debt. I know that my husband and I will be responsible for their furneals ect… when they pass. (We each have 1 brother. Mine lives on the other side of the country and his can barley look after himself) What I’m worried about is what happens to the debt after they pass?
August 26, 2010 at 10:59 pm
tough to consider this line of thought…i remember quite fondly the day i received a letter from my mom telling me she had paid off “her” house. i laughed, knowing full well dad was paying 50%, as they always had…but he always let her think she was in charge. he paid for all his toys in cash, cars, clothing, gifts for his numerous children & grandkids…and let my mom charge away as she was always hyper responsible about paying each month in full, and saving out of each paycheck for her retirement. when my mom passed, her will was specific and laid everything out in a very detailed way. we, as 7 siblings, truly appreciated her attention to this matter. my father is exactly the same, to his children goes this, to his grandchildren goes that, etc…i don’t worry about dad; one of my brothers lives less than 2 hours away and my dad would be a welcome addition in any of oiur houses, and in most any of the grandchildren’s too. my daughter would fall over herself to convince her grandpa to go live with her in new york city!
my parents were truly quite responsible and forward thinking when it came to retirement & teaching their children to be financially saavy too. i don’t have a huge retirement fund; however, i continue to up the percentage of my salary i save and plan in 2011 to take advantage of the over-50 catch-up clause. age does have its advantages!
for those of you who aren’t blessed to find themselves in the same position, i would echo what’s already been stated: talk to mom & dad. put the cards on the table and be willing to take the difficult conversation and comments made. it won’t be pretty, and it may be quite emotional. but taking the time now will definitely pay off as all parties come to the table, share their thoughts, fears, and dreams; only then can resolution be found.
*sigh* now if my brother could just pull himself together financially, i think we’d all be set. i guess 1 out of 7 is pretty good though…
August 27, 2010 at 8:17 am
[...] You, Your Parents and The Money @ Gail Vaz-Oxlade [...]
August 27, 2010 at 9:26 am
@ Kristy – debt can not be inherited. Unless you’ve signed for it, its not your problem. You just wont get any of their assets either.
August 27, 2010 at 9:36 am
[...] You, Your Parents and The Money @ Gail Vaz-Oxlade [...]
August 28, 2010 at 10:35 am
I cried reading this b/c it’s like it was meant for me to read. As an adult child living with her parents, it’s a struggle every day watching them mis-manage their very limited funds. My father, retired with no pension, has racked up “secret” debt amounting to over $20k – we still don’t know where this money went! My mother, who is a few years from retirement has less than $30K in retirement funds. Currently they still owe more than 2/3 on their mortage, with no emergency funds! They are so bad with money, that the rent I pay is directly put towards the mortage and their line of credit as bonus payments (if I gave it to them, it would never make it to a bill payment!).
Gail is right when she says that helping others financially takes away from your own life. It’s a constant, conscious effort to fight resentments (my own!) and try to achieve balance in my life, knowing they are in dire financial straits. I do want to move out, but don’t want them to loose the only real asset they have. I’m just happy Gail helps me to stay financially grounded…oh nice touch finding out she’s from JA too.
August 28, 2010 at 11:10 am
Ann – I hear you. My younger sibling is only in her late teens but she seems to squander her money on “stuff” and then needs to “borrow” money to actually pay for her expenses. As a result my parents who are in a pretty bad financial shape as it is fork out money for her extras like her gas, cell phone and all. They also do not charge her room and board to live at home. She called me once to ask if I can give her $2000.00 but did not want to tell me why. She then finally admited it was for a piano. ( she has a baby grand and a keyboard already) I did not lend her the money but it really made me angry.
My parents are another constant worry in my head. They are in a baad position financially and they have no savings for retirement. My dad is 70 and he still works. his CPP is enough to cover their rent. my mom is is in failing health and at 55 is still working with no hope of retiring anytime. They are too proud to ask for money but I am not sure what will happen. They do not want to talk about the future or take any advice about money. I really don’t know what to do.
August 28, 2010 at 3:35 pm
I too am one of those who feel though this was written directly to me.
I am in my early twenties, just recently graduated from University and started a fantastic new job. In the short time that I have been there, I purchased a brand new home and vehicle and am swiftly paying off the reasonable student debt I accumulating while at University. I work for great company with a great pension and investment savings plan and put away a substantial amount of money each month into long term savings. I am constantly referring to my budget worksheet to ensure that I am on the right track to achieving my financial goals.
The problem is my mother… she is quickly approaching retirement age and lives paycheck to paycheck. She racked up a substantial amount of debt over the years including having to take out second and third mortgages on her home. My brother had to co-sign the last mortgage and to my knowledge he quite frequently has to make payments towards it. The heat and electricity and phone are always being disconnected due to missed payments, something I remember occurring while I was growing up. She has ‘borrowed’ money from my elderly grandparents to pay off debt (I doubt she has the means to pay it back) and damaged their credit.
The situation has started to cause conflict between my brothers and I within the last couple of years. She was ‘given’ a trip by another family member but was required to pay for her own plane ticket (which she did not have the money for). My brothers both chipped in for the ticket and I declined to do so because I at the time was a University student with no source of income. I know they resent me for not helping her while they both do.
Recently she decided to cut her full time hours down to only part time and I know that she is struggling even more financially because of it. My question is, when I have the means to help her how do I turn a blind eye to her situation? How do you help someone who continues to did themselves into a deeper and deeper mess? I feel that other family members ‘bailing her out’ time and time again has contributed to her inability to manage her funds appropriately.
August 28, 2010 at 10:50 pm
I read the replies to this post with interest, because most of the people here seem to have responsible parents.
My situation is different. Partly I think the lack of ambition on my parents’ part need to be blamed. Despite being frugal I don’t think my parents save enough for retirement. Only quite recenty do I realize that my dad hasn’t been earning to his full protential. On the other hand, my mom stayed at home to raise us. Meanwhile, me and my siblings were given almost everything money could buy until our late teenage years. So, it was a shock when we learned that my parents, unlike our friends’ parents, didn’t have extra money for us for post-secondary education. I was so prepared to leave home but I ended up attending the unviersity at my hometown and be resentful. I think if dad would have been more ambitious he woud bring home more money. Perhaps my parents would still want me pay my way through my university education, but at the very least they wouldn’t have felt that they’d spent every single penny on us.
Partly I think the way they understand the Chinese culture needs to be blamed, too. Because they feel that they’d spent every single penny on us, me and my silbings should show them some love by spending money on them. I’m still working on getting pass my resentment about my university tuition bills. So everytime my mom says that she “deserves” to have certain things, I’m ready to blow!
If I’m so blessed to have children, I will never treat them as my RRSP.
August 29, 2010 at 9:27 am
Have any of you looked into the cost of nursing homes lately? $5,000 to $6,000 a month. So what is a child to do? Mom’s money is tied up in home equity. Even after freeing up the equity her money would run out in 2 years. Currently she is 91, lives on her own in a condo but dementia has slowly been taking over for the past 4 years. In about a year she won’t be able to live on her own (she doesn’t always recognize me) but her body is very healthy. She will probably live to 100. The amount of her pension is just over the allowed amount for government support, so there will be no government assistance. The nursing homes I have spoken to will kick her out when her money runs out. I would have her move in with me but my house is a small two story. I would sell to buy a house for the both of us but I’m underwater on my mortgage. I’m working a full time job (which can include overtime) and I’m at her condo (a half hour drive one-way) seven days a week to make sure she is OK. I’m wondering what is going to happen in a year and I’m too close to the situation to see the big picture. I’m open for suggestions.
August 29, 2010 at 3:27 pm
@Chas – Wow, this must be a very draining situation for you. You must be exhausted dealing with this and supporting your Mom.
My grandmother recently moved into a funded nursing home. She lived on her own into her 90’s and then into a private somewhat assisted condo. Recently they determined she needed more care so she moved into a government funded nursing home. I believe she has a fair bit in the way of assets, but I understand her current accommodation is based upon a percentage of her income. She was luckily able to get into their first choice quite quickly. I wish I knew more details – but I wonder if there are some options out there for your Mom that will be based on percentage of her income even if she is over a predetermined limit? I know that when my Mom looked around, they varied in quality – but they were able to find one that they were quite happy with.
Do take care of yourself !
August 29, 2010 at 5:42 pm
@ Chas: Before you believe that you need to foot in $5000-$6000 for your mom’s care, I think you should do some research on which part of your mom’s care would be eligible for assistance from government health plan like OHIP in Ontario. You might be surprised to find out that for someone who has dementia, OHIP could cover his or her Chiropodist visit! And I agree with Jen — you should look at government funded nursing homes.
August 29, 2010 at 11:36 pm
Shelley:
That can be tough. It is time for a good talk which includes the financial resources of your Mother and her expenses. Your Brothers have to get a real picture of the situation and you are entitled to expressing your opinions. A talk with your Mother might follow. You might feel the need to give some money. You might inform your Brothers that you will give nothing for at least 45 or 60 days after the initial discussion (let things cool down). That first talk HAS to be about getting your Mother on a reasonable and sustainable budget. A subsequent talk could be about additional money from the ‘kids’ but why agree to that unless every one (including you, your Brothers and your Mom) has a clear picture of the situation. Once that is on the table, every one can go home and mull over the right thing to do for them. You might decide to pay for a specific item directly to the company (phone, cable, utilities) and might decide to have some things in your name (unless there is a bad legal aspect to that) for her benefit. If your Brothers want to enable her, it is their choice but not your responsibility (but they have to see that). I agree to not giving money until you see a plan in front of you. Good luck!
August 31, 2010 at 12:57 am
[...] You, Your Parents and The Money @ Gail Vaz-Oxlade [...]
August 31, 2010 at 5:00 pm
@Ann, does your sister expect you to help her out financially? You could offer to give her financial advice, but that probably is not what she wants. At all.
My sister has not been talking to me, and I heard from a mutual friend that she is angry that I have not supported her family. I have in fact made investments for my nieces, which they will get when they graduate from high school. I had given my sister some money for the girls when they were babies, but instead of investing the money/putting it in an RESP she and her husband spent it on car repairs and the like.
It’s like being part of her family has an entrance fee, and since I haven’t “paid” I am not considered part of it. I don’t know my nieces and that is really sad.