Worried about sibling financial future

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justsomeguy2018
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Worried about sibling financial future

Post by justsomeguy2018 »

Maybe some BHs have similar situation....

I have one older sibling, early 40s, married 20+ years. Still lives in same small-ish town we grew up in.

Honestly, I am not really close to this sibling. Only communication would be during the holidays, or maybe the occasional happy birthday text.

I apologize if this comes across as snooty, but I know that they are not very well off financially (no savings, no assets other than vehicles, no home ownership, lower income, no high school diploma etc). Sometimes I worry that they may be in a real financial pickle when it comes time for their retirement because they have no savings, don't own a home, etc.

I have no intention of interfering with their life, but has anyone ever been in a similar situation or had similar concerns?
annu
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Re: Worried about sibling financial future

Post by annu »

You might like a view from opposite end than yours.
Not going too much into detail, just knowing my brother cared, was enough for me. My issues were never just financial, but I sure needed good people who cared, to be present.
So if you reach out, do that without any judgement. Not everyone needs a stock portfolio to retire, or a big 401k savings account. If your expenses are low and live where home ownership is cheaper, probably you have more options.
Biggest expense that will cause problems in older age is Healthcare, and if you are in similar age range, you can talk to him about that. Maybe if he understands better about this specific area, it will lead to other options/discussions with him.

I was bad about keeping in touch, but starting there will definitely help, no one will share or listen to a stranger, we all share/listen more to people who are in our lives more. So if you think a lecture talking to him can help, it is no different than a self help book you get as a gift or a youtube link someone else sent(aka you did not invest anythign into it).

Now when I look back, my brother, made sure he talked to me every day over some form of communication(even sharing stupid memes was an example) and every saturday @ 10 AM, no matter what was going on, he would call and we would talk, pretty soon I was doing same every Tuesday evening @ 7, he insisted to let me know that a specific time will work him better, now looking back, he wanted to make sure I schedule it in, to keep up with it.

Also in some cases, you can only help people, who will take help, you may think someone needs help, but if they dont see it same way, not your fault.
stimulacra
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Re: Worried about sibling financial future

Post by stimulacra »

Keep in touch. Maybe monthly call or weekly text to get the channel of communication flowing again. Create opportunities to spend time together and have meaningful conversations. Finances and retirement shouldn't even be on the agenda of topics for the first few times you do this. It'll eventually surface.

Early forties isn't too late to course correct.

Good luck.
Katietsu
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Re: Worried about sibling financial future

Post by Katietsu »

You can find many threads here where people are trying to assist an older loved with low income. Lower income means that social security will make up for much of his lost wages after retirement. Lower income can also mean access to free medical care and subsidized housing.

If you keep yourself financially stable, you may be able to help out in small ways that makes his life better, should you choose to.

For now, you can help by listening for the big dangers like no health insurance and pointing towards possible solutions if available. You might help by providing information and not money in these situations.
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camillus
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Re: Worried about sibling financial future

Post by camillus »

They might be specialists at living with a very low income, and so they don't consider themselves as having a problem. If you are interested in developing a relationship, that's one thing, but I don't think you have very much in common.
invest4
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Re: Worried about sibling financial future

Post by invest4 »

The most important thing is to simply love your brother the best way you can and feel comfortable with.

I recognize and appreciate that people often feel an obligation (whether by their own expectations or under the potential pressure of others / society) to provide some type of financial support to a struggling sibling if they are able.

In my view, this may be absolutely appropriate for a sibling who is otherwise responsible, but has fallen on hard times for one reason or another. However, there is another type of person who is simply unable or unwilling to help themselves...usually their entire lives. For this person, while you may still decide to help them (whatever your reasons), you should not expect any type of 'return on your investment' as far as creating a better situation for them longer term. They are who they are and you are extremely unlikely to change them. You are much more likely to be disappointed and potentially resentful.

Such a situation can be very difficult and usually impacts the whole family (parents, other siblings, in-laws, etc.). Only you can decide what is right for you and your family.

Best wishes.
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justsomeguy2018
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Re: Worried about sibling financial future

Post by justsomeguy2018 »

invest4 wrote: Sun May 24, 2020 3:30 am The most important thing is to simply love your brother the best way you can and feel comfortable with.

I recognize and appreciate that people often feel an obligation (whether by their own expectations or under the potential pressure of others / society) to provide some type of financial support to a struggling sibling if they are able.

In my view, this may be absolutely appropriate for a sibling who is otherwise responsible, but has fallen on hard times for one reason or another. However, there is another type of person who is simply unable or unwilling to help themselves...usually their entire lives. For this person, while you may still decide to help them (whatever your reasons), you should not expect any type of 'return on your investment' as far as creating a better situation for them longer term. They are who they are and you are extremely unlikely to change them. You are much more likely to be disappointed and potentially resentful.
This is kind of my fear actually. Doing something to help but it going nowhere because they aren't really long-term thinkers.

For example, in an ideal world I would like to gift them a small sum to start a Roth IRA that they could possibly contribute to (even if only $15/mo), but most likely the money would be gone in 5 years or seized by creditors.
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backofbeyond
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Re: Worried about sibling financial future

Post by backofbeyond »

I have three sisters in similar situations. One is retired and the other two are almost at that age, all single. Their savings are almost non existent. SS and part time jobs will be what they live on. I''ve always made it a point to stay in contact with all of them and let them know that if things get tough, they always have a place to shelter with my family. The retired one has come to live with my family 3 different times in her life.

All three say that simply knowing they have a place to go to if things get really bad, relieves a lot of stress.

We have one daughter that when she comes into her own, would be very well off. So for us, helping our siblings with a "warm hand"' is better than giving it all with a "cold hand" to our daughter. Charity begins at home they say.
The question isn't at what age I want to retire, it is at what income. - George Foreman
terran
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Re: Worried about sibling financial future

Post by terran »

This isn't something you can control and therefore should try not worry about (I didn't say shouldn't worry about, because that can be hard). What you can and should think about is what you're willing and able to do if they come to you with their hand out. Try to come up with some situations and what you'd be willing to do so you don't have to make those decisions in the heat of the moment. I wouldn't give them money for an IRA, but if you want to be able to help supplement their retirement you could over save in your own accounts up to the amount of support you're willing to give.

Keep in mind that social security will replace a large amount of a low income person's income. If they manage to work a full 35 years, the first $11,520 (in 2020 dollars) will be replaced at 90%.
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Watty
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Re: Worried about sibling financial future

Post by Watty »

justsomeguy2018 wrote: Sat May 23, 2020 11:27 pm I have one older sibling, early 40s, married 20+ years......lower income....
One thing that you might be able to get them to look into is to see if they know about the retirement savings contributions credit.

The way this works is, depending on their income, they can contribute $2,000 each to an IRA and get up to a $1,000 credit each in addition to a tax deduction.

That is non-refundable though so that if they did not owe $1,000 in federal taxes they could only get that up to the amount of taxes they would have owed.

If the tax deduction is worth $200 then this means that for $800 out of pocket they could each get $2,000 in an IRA. ($2000 - $1000 - $200)

The income at this link is an adjusted gross income which may be less than their salary because of some subtractions.

https://www.irs.gov/retirement-plans/pl ... ers-credit

If they qualify they could still get this for 2019 but they might need to file an amended tax return if they have already filed their taxes.

It also is possible that their current situation is not as bad as you envision.

If they are both working jobs at $15 an hour that is $31K a year each which combined is over $62K a year which is right about the median household income.

https://www.census.gov/library/stories/ ... -2017.html
Last edited by Watty on Sun May 24, 2020 11:41 am, edited 1 time in total.
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climber2020
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Re: Worried about sibling financial future

Post by climber2020 »

justsomeguy2018 wrote: Sat May 23, 2020 11:27 pm I have no intention of interfering with their life, but has anyone ever been in a similar situation or had similar concerns?
Yes. Not my problem, and not my responsibility. Any future request for money will be promptly denied.
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Cranberry44
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Re: Worried about sibling financial future

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ram
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Re: Worried about sibling financial future

Post by ram »

If ones hangs around on this board long enough your baseline shifts. We have many threads here where a million does not seem enough to retire on.

I live and work in a rural agricultural midwest community and have many patients who have little money but seem content. If they have worked 35 years they have a decent social security income. Some have modest pensions. Some other work part time as handymen etc.

Cost of living is low. Median house price is 140K and a small older house is available for 70K. Small unsubsidized apartments are available for 400/mo. Healthcare costs however can cause difficulties. Many need help for registering for the appropriate government assistance program for healthcare, prescription programs, subsidized housing, home health assistance etc especially if they lack a high school education.
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Wricha
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Re: Worried about sibling financial future

Post by Wricha »

justsomeguy2018 wrote: Sat May 23, 2020 11:27 pm Maybe some BHs have similar situation....

I have one older sibling, early 40s, married 20+ years. Still lives in same small-ish town we grew up in.

Honestly, I am not really close to this sibling. Only communication would be during the holidays, or maybe the occasional happy birthday text.

I apologize if this comes across as snooty, but I know that they are not very well off financially (no savings, no assets other than vehicles, no home ownership, lower income, no high school diploma etc). Sometimes I worry that they may be in a real financial pickle when it comes time for their retirement because they have no savings, don't own a home, etc.

I have no intention of interfering with their life, but has anyone ever been in a similar situation or had similar concerns?
Someone wise said I having no intention of interfering with their life.
Topic Author
justsomeguy2018
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Re: Worried about sibling financial future

Post by justsomeguy2018 »

ram wrote: Sun May 24, 2020 12:39 pm If ones hangs around on this board long enough your baseline shifts. We have many threads here where a million does not seem enough to retire on.

I live and work in a rural agricultural midwest community and have many patients who have little money but seem content. If they have worked 35 years they have a decent social security income. Some have modest pensions. Some other work part time as handymen etc.

Cost of living is low. Median house price is 140K and a small older house is available for 70K. Small unsubsidized apartments are available for 400/mo. Healthcare costs however can cause difficulties. Many need help for registering for the appropriate government assistance program for healthcare, prescription programs, subsidized housing, home health assistance etc especially if they lack a high school education.
I am worried $2.5M won't be enough to retire on!
NJ_Bogler
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Re: Worried about sibling financial future

Post by NJ_Bogler »

Not sure what’s driving you to get involved when you say you’re not really close and rarely communicate.

It seems like the first step would be to develop some sort of relationship, if that’s even what you want to do. Once you have that relationship, maybe you’ll learn whether in fact they actually have any money issues.
MathWizard
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Re: Worried about sibling financial future

Post by MathWizard »

I have a younger sister who may need help, but I have lots of brothers who could help.

She is pretty independent, so I am just looking to make sure my family is OK, and being very conservative with my estimates of what I can withdraw. I should then have plenty if she needs help.

One possibility is when she turns 62.
I assume she might want to take SS at 62. I estimate that her SS at 62 would be about $9.1 K , but that she could get $13K at 67
I may be willing to give her $ 9.1 K per year with cost of living adjustment for her to wait until 67 to claim. That would cost me
$45.5 K real, but then she would have $5.2 K /yr more for as she lives. She is not married.
To do this until 70 would cost another $27.3 real,so $72.8K real to
get her to just over $16 K /yr inflation adjusted of SS.

That is nearly as much as she made, though she would not have benefits , health insurance in particular. She has about $100K in a 401k, a paid off house,and a small pension
The extra almost $7K/yr should put her in a good place.

I'm not sure if I will do it,or get together with brothers to do it.
I'm also not sure she would accept.
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warowits
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Re: Worried about sibling financial future

Post by warowits »

justsomeguy2018 wrote: Sat May 23, 2020 11:27 pm
I have no intention of interfering with their life, but has anyone ever been in a similar situation or had similar concerns?
I grew up in a similar small town. The average retiree had a paid for house (worth very little), SS and maybe a part time job if they could still physically work. That was it. But these are not sad, destitute people. They know where their next meal is coming from and have a roof over their heads.

It costs very little to live a good life in LCOL parts of America. It isn’t the life you wanted, so you saved enough money to put you in the top 5%, even in a very wealthy country. But somehow you are still scared.

What are you buying with your 2.5 million? Is it something your brother even cares about?

That being said I think owning a home is what makes these situations work. Without that his future is far bleaker. Maybe stress to him the value of home ownership.
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Stinky
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Re: Worried about sibling financial future

Post by Stinky »

MathWizard wrote: Sun May 24, 2020 10:51 pm I have a younger sister who may need help, but I have lots of brothers who could help.

She is pretty independent, so I am just looking to make sure my family is OK, and being very conservative with my estimates of what I can withdraw. I should then have plenty if she needs help.

One possibility is when she turns 62.
I assume she might want to take SS at 62. I estimate that her SS at 62 would be about $9.1 K , but that she could get $13K at 67
I may be willing to give her $ 9.1 K per year with cost of living adjustment for her to wait until 67 to claim. That would cost me
$45.5 K real, but then she would have $5.2 K /yr more for as she lives. She is not married.
To do this until 70 would cost another $27.3 real,so $72.8K real to
get her to just over $16 K /yr inflation adjusted of SS.

That is nearly as much as she made, though she would not have benefits , health insurance in particular. She has about $100K in a 401k, a paid off house,and a small pension
The extra almost $7K/yr should put her in a good place.

I'm not sure if I will do it,or get together with brothers to do it.
I'm also not sure she would accept.
Funding your sister to allow her to delay SS would be exceptionally generous. And would be really helpful to her, if she accepted it.

You mention that health insurance would be a concern. Remember that Medicare kicks in at age 65. In many parts of the country, electing into Medicare Advantage would give her a drug plan and supplementary benefits at little or no additional cost.
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michaeljc70
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Re: Worried about sibling financial future

Post by michaeljc70 »

I have two brothers that have no savings and make little effort to work. They are in their 40s, but I highly doubt they will change their ways. Both are smart and it is a self made situation so they won't be getting any help from me. One brother had a 6 figure job and got mad at the company and quit (without notice - just stopped showing up) and hasn't worked in 6 years. I'm really not sure how they even survive....I guess scrounging for whatever they can get and some generous (but smallish in the big picture) gifts from our parents. I always wonder how they will survive (and what they think they will do) as they get older as they won't even get much SS given their work history.
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Sandtrap
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Re: Worried about sibling financial future

Post by Sandtrap »

Communication is a person’s choice.
Equal and open reciprocal “tit for tat give and take” communication is by choice and also capability (willingness and ability).

For example:

You send a 20 sentence sharing email to sibling or friend.
Response: “that’s nice”.

You receive Yearly birthday and holiday texted symbol or moving emoticon. No text or words or sentences. No response to your response beyond that.

Holiday family, relatives, friends get together.
Other person: “Hey, we should get together for lunch sometime, I’ll call you.”
Never happens. Same line no follow through empty words.

Actionably: it is difficult not to measure the behavior and concerns of others against our own values and conduct. If you were as important to someone as they were to you, they would reach out as well. It creates awkwardness to create imbalances.

Actionably: if you reached out and said friends/family got your “I’m financially well off” message, what would you do if they asked for a $10000 loan?

Then again, a courtesy text response with some sharing opens the door that is theirs to take or not.
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muddlehead
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Re: Worried about sibling financial future

Post by muddlehead »

To the OP:
I am/was in a similar situation with 2 of my siblings. Not sure I can offer any actionable advice, however.
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JoMoney
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Re: Worried about sibling financial future

Post by JoMoney »

I've known people who managed their entire life never having more than the next few days worth of expenses (or even in perpetual debt). Some of them seemed quite happy in their personal situation. They certainly never "worried" about what the stock market was doing, liability 'umbrella' insurance policies, convoluted tax planning, estate planning, etc...

Some people will never make it to retirement age. Maybe your sibling worries that you save too much sacrificing the life you could be living today for a future you may not make it to (let alone whether your investments pay off). Perhaps they'll enjoy your savings for you if you go before them.

I expect Social Security will continue to be extremely important, perhaps more so, going into the future.
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Cycle
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Re: Worried about sibling financial future

Post by Cycle »

If they have health and shelter, that's better than having millions and shelter, but poor health.

Everything is relative, in central America people get by and live healthy to old age on five dollars a day.
Never look back unless you are planning to go that way
sd323232
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Re: Worried about sibling financial future

Post by sd323232 »

justsomeguy2018 wrote: Sat May 23, 2020 11:27 pm Maybe some BHs have similar situation....

I have one older sibling, early 40s, married 20+ years. Still lives in same small-ish town we grew up in.

Honestly, I am not really close to this sibling. Only communication would be during the holidays, or maybe the occasional happy birthday text.

I apologize if this comes across as snooty, but I know that they are not very well off financially (no savings, no assets other than vehicles, no home ownership, lower income, no high school diploma etc). Sometimes I worry that they may be in a real financial pickle when it comes time for their retirement because they have no savings, don't own a home, etc.

I have no intention of interfering with their life, but has anyone ever been in a similar situation or had similar concerns?
Thats your opinion, and why are you to judging their finances? The only finances you should worry about are your own. I mean, what if someone with 50 million networth looked at your finances and said, "well, this person is really bad financially, he does not have 50 million like me, how heck is he gonna retire?"
Carguy85
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Re: Worried about sibling financial future

Post by Carguy85 »

Same situation with my father in law. He is nearly 60 and in construction (owns his own business) and has no savings, no retirement, no health insurance, and spends every last extra dollar he makes trying to prop up his daughter (my wife’s step sister) and his x wife that don’t seem to care much about him. He is very good at what he does and has always managed to make it to the next job but his luck may be running thin in this economy..My wife and I get extremely frustrated because we care so much about him and the kids love their papaw. The stark truth is that nothing we can say or do will help him change for the better if he hasn’t already come to such conclusions to want to make his life better/easier.
stoptothink
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Re: Worried about sibling financial future

Post by stoptothink »

If I worried about the financial future of my parents and in-laws, let alone my 6 siblings (and my wife's 3 siblings), I'd never be able to sleep. Between all of them, I'd say there is only 1 (my younger brother) who is even remotely financially stable and considers saving. My in-laws, in their early 60's have a negative net worth around $300k (almost no assets and >$300k in education debt). If they need a roof over their head, they have one at my home; otherwise it is not my problem and frankly none of my business.
NewMoneyMustBeSmart
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Re: Worried about sibling financial future

Post by NewMoneyMustBeSmart »

justsomeguy2018 wrote: Sat May 23, 2020 11:27 pm I have no intention of interfering with their life, but has anyone ever been in a similar situation or had similar concerns?
How is this actionable?
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MathWizard
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Re: Worried about sibling financial future

Post by MathWizard »

Stinky wrote: Mon May 25, 2020 4:59 am
MathWizard wrote: Sun May 24, 2020 10:51 pm I have a younger sister who may need help, but I have lots of brothers who could help.

She is pretty independent, so I am just looking to make sure my family is OK, and being very conservative with my estimates of what I can withdraw. I should then have plenty if she needs help.

One possibility is when she turns 62.
I assume she might want to take SS at 62. I estimate that her SS at 62 would be about $9.1 K , but that she could get $13K at 67
I may be willing to give her $ 9.1 K per year with cost of living adjustment for her to wait until 67 to claim. That would cost me
$45.5 K real, but then she would have $5.2 K /yr more for as she lives. She is not married.
To do this until 70 would cost another $27.3 real,so $72.8K real to
get her to just over $16 K /yr inflation adjusted of SS.

That is nearly as much as she made, though she would not have benefits , health insurance in particular. She has about $100K in a 401k, a paid off house,and a small pension
The extra almost $7K/yr should put her in a good place.

I'm not sure if I will do it,or get together with brothers to do it.
I'm also not sure she would accept.
Funding your sister to allow her to delay SS would be exceptionally generous. And would be really helpful to her, if she accepted it.

You mention that health insurance would be a concern. Remember that Medicare kicks in at age 65. In many parts of the country, electing into Medicare Advantage would give her a drug plan and supplementary benefits at little or no additional cost.
Good point on Medicare Advantage. I have a very good plan through work that my wife and I can stay on, but it plus the Medicare premiums will be about $5.2K /yr each.

Thanks.
MishkaWorries
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Re: Worried about sibling financial future

Post by MishkaWorries »

NJ_Bogler wrote: Sun May 24, 2020 7:26 pm Not sure what’s driving you to get involved when you say you’re not really close and rarely communicate.

It seems like the first step would be to develop some sort of relationship, if that’s even what you want to do. Once you have that relationship, maybe you’ll learn whether in fact they actually have any money issues.
Agreed. The OP seems way ahead of himself. He needs to ask if he is doing this for the sibling or himself. Or is he just posturing or indulging in judging?
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clip651
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Re: Worried about sibling financial future

Post by clip651 »

justsomeguy2018 wrote: Sun May 24, 2020 9:33 am
invest4 wrote: Sun May 24, 2020 3:30 am The most important thing is to simply love your brother the best way you can and feel comfortable with.

I recognize and appreciate that people often feel an obligation (whether by their own expectations or under the potential pressure of others / society) to provide some type of financial support to a struggling sibling if they are able.

In my view, this may be absolutely appropriate for a sibling who is otherwise responsible, but has fallen on hard times for one reason or another. However, there is another type of person who is simply unable or unwilling to help themselves...usually their entire lives. For this person, while you may still decide to help them (whatever your reasons), you should not expect any type of 'return on your investment' as far as creating a better situation for them longer term. They are who they are and you are extremely unlikely to change them. You are much more likely to be disappointed and potentially resentful.
This is kind of my fear actually. Doing something to help but it going nowhere because they aren't really long-term thinkers.

For example, in an ideal world I would like to gift them a small sum to start a Roth IRA that they could possibly contribute to (even if only $15/mo), but most likely the money would be gone in 5 years or seized by creditors.
So, you already know it's not an ideal world. If you are worried about your sibling, and would like to be able to help them out if they got into a tough spot in the future, there is a simple solution, and doesn't even require your sibling to be aware of it. (This assumes your spouse/partner, if you have one, is on board.)

Open an account in your own name, with your sibling listed as beneficiary. It can be whatever you feel comfortable with - a high yield savings account, a brokerage account with index funds in whatever asset allocation you feel is appropriate for this savings goal, etc. Anytime you wish that you were able to give them a small sum that you wish they would set aside and add to in order for them to save for a future rainy day, put the money in this account. You can add however much you wish. The money will still be yours, so you'll know it's looked after properly until/unless it's needed. And if you decide you need the money yourself, it's still yours, and you can use it however you like.

Since the money is in your name, you retain control of how much you add, when/if you decide to gift some to your sibling, how it's invested, etc. This may help set your mind at ease, because you have a plan and you've done something about the problem you are concerned about, even if your sibling isn't worried. And on a practical level, you'll have money set aside to help the sibling if you decide to do so.

The relationship issue with the sibling is a separate issue. Maybe you want to try to build the relationship, maybe you don't, and ditto for them. But I wouldn't build it just with the idea of teaching them how to run their financial life. It's fine to offer ideas if asked, or to mention that you're available if they have questions, but I wouldn't push it. Their life is much different than yours. They may be OK with that, or they may wish it was different, but might not want advice from you. It's nice of you to care about your sibling despite the distant relationship.

best wishes to you and your sib,
cj
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1789
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Re: Worried about sibling financial future

Post by 1789 »

justsomeguy2018 wrote: Sat May 23, 2020 11:27 pm Maybe some BHs have similar situation....

I have one older sibling, early 40s, married 20+ years. Still lives in same small-ish town we grew up in.

Honestly, I am not really close to this sibling. Only communication would be during the holidays, or maybe the occasional happy birthday text.

I apologize if this comes across as snooty, but I know that they are not very well off financially (no savings, no assets other than vehicles, no home ownership, lower income, no high school diploma etc). Sometimes I worry that they may be in a real financial pickle when it comes time for their retirement because they have no savings, don't own a home, etc.

I have no intention of interfering with their life, but has anyone ever been in a similar situation or had similar concerns?

A lot of people are already happy with their lives. Maybe your siblings too. Why do you want to break a system that works for them. Do you think your sibling will come and ask your help one day? From what you summarised, it is likely that your sibling may not ask a penny from you and can survive life with his/her own rules.
"My conscience wants vegetarianism to win over the world. And my subconscious is yearning for a piece of juicy meat. But what do i want?" (Andrei Tarkovsky)
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