What to do with all this MONEY ?

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Seasonal
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Re: What to do with all this MONEY ?

Post by Seasonal »

Rajsx wrote: Sun Jul 05, 2020 7:12 pmThis is not uncommon if you observe people around you, just an example of Warren Buffet comes to mind, he still lives in his old house but can probably buy the whole town & more. He probably feels comfortable, likes it there & does not want to change.
Warren Buffett's company bought NetJets. He no longer flies commercial, let alone coach.
JackoC
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Re: What to do with all this MONEY ?

Post by JackoC »

FIREchief wrote: Mon Jul 06, 2020 1:09 am
goodenyou wrote: Sun Jul 05, 2020 10:58 pm You are brave to post your yearly budget. I wouldn’t be as brave because it would be flamed to a crisp. Comparing your spending to the average spending in the USA or to an average third world citizen is meaningless.
LOL. Ironically, my suggestion that I can live happily/comfortably on $60K was only met with criticism that I should spend more (and be less happy). Strange (first) world we live in.... :P
Yes but unless I missed it I didn't see you give any specifics on your asset level (which of course you don't need to, I don't). And the most relevant comparison of spending level for retired/near retired people is their assets and incomes streams. What the median income is in the local community, country or world is only tangentially relevant, and mainly in the first case*.

And based on goals in terms of bequest. Again IMO OP's spending is not that low with a goal of preserving inflation adjusted principal for heirs. It's around the triple net (after expenses, taxes and inflation) expected return on 55/45 portfolio in my estimation. OP could spend much more without a serious chance of running out of money. But first one must establish the goal, pretty sure of not running out of money and a sizable bequest in most cases; or alternatively maintain the inflation adjusted principal at the expected return. Those imply quite different % withdrawal rates.

But of course OP (let's stick with that example because we know the asset level) could spend $60k if that's all they want to spend. There just should probably be some thought given at super low withdrawal rates like that would be for OP what the goal of the whole exercise actually is, especially for people yet to accumulate the money pile, though various sacrifices, that they won't ever want to spend much of. Maybe it's just to be happy from *having* the pile. That's OK too, but maybe in some cases people haven't been fully honest with themselves that that's their actual goal.

*the whole country or world doesn't know or care what we, specifically and personally, do. But some people we know locally, and extended family, might become more envious (already a background tension in some of our relationships for years) if we raised our spending a lot. Nor is it as simple as 'then go somewhere else and make new friends', we'll lived same place for 30+ yrs. We don't decide our spending mainly based on this, but it is *a* factor, particularly in visible purchases.
bsteiner
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Re: What to do with all this MONEY ?

Post by bsteiner »

Since the original poster is 64 and his wife is 59, one or both of them could live another 20 or 30 years or more. At this point, while they have ample money for their living expenses, we don't know what the future will bring. Also, while they have more money than most people, from an estate planning standpoint their estates are far from being considered large.

They should provide for their children in flexible trusts. That will keep their inheritances out of their estates for estate tax purposes, which is particularly important for their daughter since she and her husband are both physicians. It will also protect their inheritances against their creditors (which is particularly important for their daughter for the same reason) and spouses. In the case of the son, it will protect against him spending too much and running out of money.

They should consider the degree of control that each child (especially the son) should have over his/her trust.

If the son is likely to need some distributions, isn't likely to have a taxable estate, and has a low risk of creditors and divorce, they might consider leaving his share of their retirement benefits in a charitable remainder trust to replicate the stretch.
bltn
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Re: What to do with all this MONEY ?

Post by bltn »

Rajsx

Obviously in this thread, you voiced concerns similar to those of many on this forum. Many of us think about the best way to manage an accumulation in terms of inheritance at the end of a long productive career.

Although there have been some scoldings regarding your interest in your son s financial affairs, I think your concern is very reasonable.
While, admittedly he is doing fairly well in not accumulating debt as he educates himself for his career," fairly well" is not up to your family s standards. You are trying to make him smart about his money. You care about him.

I always give family advice regarding money management as follows. I don t tell them what they should do. Instead I tell them what I would do if I were in their place. And since I m far from an expert, they can decide for themselves how smart it is.

Like you, I also have an interest in providing my children with food for thought regarding their personal financial management. If I had known in my 20 s and 30 s what I learned in my early 40 s about money management, I d be better off now. My children know this and know that I try to supply them with financial information based on my experience because of my care for their overall well being. Because they understand that my motivation for the money discussions is purely to help them have a better life, they listen with a fair amount of respect, and before they know it, with interest. (My wife also has suggested not talking to the kids so much about money.). I think those talks are preferable to letting them learn about financial mistakes the hard way. And I should know.

I think that learning from the experience of a loved one can often be better than learning from personal experience. I would never stop trying to educate my children, in a way that they would appreciate.

That seems like a lot of cliches, but I understand your concern about your son (and daughter).

I also believe that trusts may be beneficial and think you might like to investigate their potential.

All the best.
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FIREchief
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Re: What to do with all this MONEY ?

Post by FIREchief »

JackoC wrote: Mon Jul 06, 2020 9:33 am
FIREchief wrote: Mon Jul 06, 2020 1:09 am
goodenyou wrote: Sun Jul 05, 2020 10:58 pm You are brave to post your yearly budget. I wouldn’t be as brave because it would be flamed to a crisp. Comparing your spending to the average spending in the USA or to an average third world citizen is meaningless.
LOL. Ironically, my suggestion that I can live happily/comfortably on $60K was only met with criticism that I should spend more (and be less happy). Strange (first) world we live in.... :P
Yes but unless I missed it I didn't see you give any specifics on your asset level (which of course you don't need to, I don't). And the most relevant comparison of spending level for retired/near retired people is their assets and incomes streams.
I would never post any specific information on my asset level on the internet. Hopefully we have enough to sustain our lifestyle, cover LTC in a nice facility if/when needed and leave something behind for heirs/charity. For anyone with more than sufficient assets (like the OP), there should be a freedom of just living life and not worrying about the money. Comparing spending level with assets becomes irrelevant if somebody is currently buying and doing everything that makes their life happy and they have more than enough assets to continue for the foreseeable future. "Extra money" has a way of taking care of itself without much attention, and leaving it in appropriate asset protection trusts for children/grandchildren is a great default position for anyone who loves their kids.
And based on goals in terms of bequest. Again IMO OP's spending is not that low with a goal of preserving inflation adjusted principal for heirs. It's around the triple net (after expenses, taxes and inflation) expected return on 55/45 portfolio in my estimation. OP could spend much more without a serious chance of running out of money. But first one must establish the goal, pretty sure of not running out of money and a sizable bequest in most cases; or alternatively maintain the inflation adjusted principal at the expected return. Those imply quite different % withdrawal rates.
Yep. Goals don't have to be complicated. To "sustain a comfortable lifestyle and not run out of money" is likely the most important for all retirees. If that one is covered, the rest can be very simple. Many on the forum would consider that as having won the game.
But of course OP (let's stick with that example because we know the asset level) could spend $60k if that's all they want to spend. There just should probably be some thought given at super low withdrawal rates like that would be for OP what the goal of the whole exercise actually is, especially for people yet to accumulate the money pile, though various sacrifices, that they won't ever want to spend much of. Maybe it's just to be happy from *having* the pile. That's OK too, but maybe in some cases people haven't been fully honest with themselves that that's their actual goal.
Interesting thoughts. You may be right about some having an actual goal of just "having the pile." I would divide those into two categories. If having the pile gives a person a sense of freedom and security, than that is likely a good thing. OTOH, if having the pile is an ego thing that makes them feel superior to others who are less fortunate, than maybe not so much...
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afan
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Re: What to do with all this MONEY ?

Post by afan »

I consider accumulating assets to be a consequence of good earning and prudent spending, both of which are valuable in themselves. One does not need a reason to be prudent any more than they need a reason to eat in moderation.

If one goes to a restaurant, few would order every item on the menu. Having a credit limit that would cover the bill is beside the point. Many bogleheads could pay such a bill but don't want all that food.

Yet people often define prudent spending as if one would do it only if they had some other plan for spending the money.

I don't order every item on the menu because I don't want every item on the menu. I don't have to restrain myself from buying all that food by remembering that the money saved can be used tomorrow or next year for a new car. I don't have to restrain myself from doing something I have no desire to do. Yes, buying every item would entail spending more money. But not all spending results in greater happiness.

Those who assume that one would always want to spend more money are chained to a hedonic treadmill. The solution is not to buy a more expensive treadmill. The solution is to get off the one you are on.
We don't know how to beat the market on a risk-adjusted basis, and we don't know anyone that does know either | --Swedroe | We assume that markets are efficient, that prices are right | --Fama
anoop
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Re: What to do with all this MONEY ?

Post by anoop »

It's like when you get to the top of the mountain and discover that the most satisfying part was the journey getting there. :)

I don't have any advice for you because I'm still climbing and probably will never make it to the summit.
azianbob
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Re: What to do with all this MONEY ?

Post by azianbob »

Why not create a trust for each of your children and grandchildren and for your son who is bad with finances set it up so that he can't use all of it but only get paid a monthly stipend from it and have it pass to his children upon his death?
SantaClaraSurfer
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Re: What to do with all this MONEY ?

Post by SantaClaraSurfer »

Simply put, more than a specific dollar outlay maybe it's time to try to get out of your habitual way of thinking/spending and have fun, ie. make the money mean something?

1. With giving, find ways, whether it's anonymous or public, to make donations that have personal meaning to you. See if you can't make it open a door to meeting someone new or learning about someplace new, or, alternately, connect to your story and your past. Instead of donating in the abstract, ie. donating a set percentage or giving to a general fund, try taking a specific sum and donating it directly to an organization where you might see or imagine the impact.

2. With travelling, try something completely new, or something that connects to your roots, or an interest you've always had. Make that a theme and go from there. It's not about travelling per se at that point, it's about the theme. Find a restaurant that fits. Try a new experience. Make a trip to a spa or go someplace where you can take a class in something you've always wanted to try. Spend a week at a museum.

3. With acquisitions and possessions, there's no need to spend big or extravagantly to identify things that could be special or meaningful to you. There could a coffee maker or a juicer or a piece of furniture that would be a joy to have in your life right now. It could be a piece of technology that's a delight. You get to pick. You call the shots. Play around, mix it up.

4. Take a small part of your funds that aren't essential and invest in a new way. Maybe combine it with some form of social investing, or not. There's at the very least, always some very interesting things you can do as an investor when you're secure in your needs. I had a friend who invested in a restaurant (which is as sure a way to lose 100% of your investment as any) but the restaurant actually succeeded and she got some great free meals and experiences in the mix.

Nothing I've said above is tied to a specific dollar figure outlay. The meaning and the experience can drive what you choose to spend. And if you like the "return" of this approach, you can choose to invest more, or not.
knightrider
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Re: What to do with all this MONEY ?

Post by knightrider »

My 2 cents is spend the money on environmentally friendly activities. Taking unnecessary airplane flights is not good for the environment and does not set a good example.

As for giving money away, I would not give money to people less frugally minded than myself. Unfortunately that means most people :-)
DJZ
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Re: What to do with all this MONEY ?

Post by DJZ »

New Providence wrote: Sun Jul 05, 2020 11:24 am
DJZ wrote: Sun Jul 05, 2020 10:24 am
afan wrote: Sun Jul 05, 2020 9:14 am I cannot agree with the advice to "spend more money". $130,000 a year is a lot of money to spend. Spending more than double the median household pretax income is hardly frugal.

More importantly, OP made it clear that they buy what they want. Spending money on things they don't want is the definition of waste.

Puzzled about the concerns over the son. Late twenties soon to have two advanced degrees including an MBA, self supporting... Oh the horror!

Leave money for the kids in trusts, not outright. This will protect it from creditors, keep it out of their estates for estate tax purposes and make it easy to choose an independent trustee if necessary. For the kid who is a physician this is even more important given risk of malpractice suits.

Consider setting up irrevocable trusts now and making at least annual exclusion gifts while you are alive. These can accumulate to a sizeable amount for retirement, grandchildren education or other big ticket expenses.

Ignore the demands that you change your spending or charitable contributions. Give to charity at the level you feel comfortable.

Depending on your state there may be estate or inheritance taxes at your deaths. You will need to go through your options with an estate planning attorney.

To the extent that you have concerns about how your kids earn and spend (although you don't cite any issues with the physician), they are still young. They are not finished growing into adults and you are not finished being parents.

Our kids range from frugal and highly knowledgeable about money to frugal and completely uninterested.

I don't get the thinking that goes "child A is financially educated, good with money and earns a high income. I will reward this by leaving them a large inheritance. Child B chose a lower income career and struggles to support themselves. I will punish them by leaving a small bequest."

We give to charity as we go but plan to leave our assets to our kids. In trust.

As the time gets closer, we may consider charitable trusts for the tax savings but I have not investigated those enough to begin to make decisions. With the new rules on inherited retirement accounts, they have become more appealing.
+1 Many good ideas here. I especially like “Consider setting up irrevocable trusts now and making at least annual exclusion gifts while you are alive. These can accumulate to a sizeable amount for retirement, grandchildren education or other big ticket expenses.“
So you skip your children and leave it all to grandchildren? It seems to me highly illogical. Why not an irrevocable trust to great, great grand children...that way it will accumulate even more.
Agreed, irrevocable trust. I didn’t mean to exclude anyone, it would be reasonable for any family member, friends, etc.
DJZ
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Re: What to do with all this MONEY ?

Post by DJZ »

TropikThunder wrote: Sat Jul 04, 2020 10:04 pm
Doug007 wrote: Fri Jul 03, 2020 5:30 pm Look into helping fund the world's biggest problem. Aging and death. This is an area that is desperate for adequate funding but so few people recognize this as the dire need it is, and the potential for vastly improved lives. This is science, not science fiction. Look into it. Start by watching Aubrey DeGrey videos to understand.
There are over 7 billion people in the world and you think the problem is that so few of them make it past 100?
About “the world’s biggest problems” - here is a thought provoking site that may generate ideas. https://80000hours.org/

The focus is on people early in their careers, to help them choose a path with positive impact. But the ideas apply to anyone.
jajlrajrf
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Re: What to do with all this MONEY ?

Post by jajlrajrf »

azianbob wrote: Mon Jul 06, 2020 5:23 pm Why not create a trust for each of your children and grandchildren and for your son who is bad with finances set it up so that he can't use all of it but only get paid a monthly stipend from it and have it pass to his children upon his death?
I've seen similar sentiments expressed a few times in this thread and I'm gonna push back on it.

First off all, we don't have a lot of info about what the son was "wasting" his money on; the only example given was "signing up for an annuity in his 401(k)". In a world where we have all known people who had kids with drug problems, crushing credit card debt, or gambling problems, this like pretty small beer. Add to that there's a natural disconnect between different people about what "wasting money" means. I'm wealthier than my parents. When I tip well, or buy something they wouldn't enjoy, or when I pay to have something delivered that I could have spent an hour picking up myself, they consider that me "wasting money"; my feeling is that that hour of my time is worth much more than what I paid to have it delivered. So just because you think your son is wasting money doesn't mean it's true.

The reality is that in the long term we are all worm food, and your relationship with your son is worth more than all your money. He has no right to your money, but trying to use your dead hand to control him from beyond the grave sends an unmistakable message, and it is not a message of love; it's a message that will belittle and hurt. Of course you love your son and want what's best for him. But part of being a parent is letting your kids make their own mistakes. Allow for that, and allow for the possibility that your opinions about what he should do with his inheritance, if you give him one, are wrong, and his are right. Maybe he'll screw it all up. But shouldn't that be his choice to make?

I think creating a trust for the grandkids that is absolutely theirs is fine, but I think trying to place too many restrictions on what you're giving your son - barring some level of irresponsibility that I didn't see in this thread, such as drug abuse or gambling problems - is probably a bad call.
Elysium
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Re: What to do with all this MONEY ?

Post by Elysium »

FIREchief wrote: Sat Jul 04, 2020 2:23 pm
KyleAAA wrote: Sat Jul 04, 2020 1:12 pm IMO it is unethical to leave large inheritances to offspring.
I haven't seen this one before! :P
I haven't understood what is the purpose of an inheritance unless someone isn't capable of taking care of themselves or recipient of unforeseen negative circumstances. People who are in decent health with good enough circumstances to make their own living doesn't need or should care for an inheritance. Just my feeling, as someone who intends to reject inheritance and donate it to whoever may need it more when the time comes.
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hand
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Re: What to do with all this MONEY ?

Post by hand »

If you don't spend it, someone else will.

As a prudent spender, your responsibility is to actively determine what the funds should be spent on, or who should decide what the funds should be spent on.

Find a between yourself, your family, and charity / social, then start executing and evaluate as needed.

Consider spending an extra $100k between these categories this year, see how it makes you feel, and readjust your future plans based on the results.

Perhaps you like Business Class flights more than you expect, perhaps your child isn't as wasteful as you think, perhaps the mission of your charity of choice is drifting.
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cashboy
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Re: What to do with all this MONEY ?

Post by cashboy »

Rajsx wrote: Fri Jul 03, 2020 2:45 pm Here is the problem, we do not feel comfortable with extravagance, find it difficult to fly 1st class, do not eat out several nights a week due to issues with weight & Diabetes. in general we do not tolerate wasteful spending as that was the modus operandi for past several decades & that is the way we were raised. We do not want to buy a larger house as it is for only two of us now & also it means more maintenance chores.
We donate regularly to our Church(Temple) although its affairs & ways are different now than when we joined. We donate to organisations which help educate not so fortunate. We entertain with our group of friends & are reasonably active socially.
if you like living/spending a certain way (not extravagant), consider continuing to do so. you have the option; do as you like to please yourself (ex: not fly 1st class), not do as what others think you should do. you have earned that right.

Rajsx wrote: Fri Jul 03, 2020 2:45 pm We often find our son wasting his money, apart from signing up for an Annuity in his 401k at work, he does not educate himself on simple financial issues. Our kids were born in the lap of luxury, in some ways it is not their fault as they have not yet seen the struggle which many face, he has not learnt the virtue in saving.
it is his money to waste (and i mean that in a nice way) as long as you are not supplementing it. if he is used to living a certain way (kids were born in the lap of luxury) at least you know why he does what he does.

Rajsx wrote: Fri Jul 03, 2020 2:45 pm i do watch my Portfolio closely, keep learning from Bogleheads & other finance books but like many we will be leaving money to the family when we pass, who may potentially spend our Piggy Bank, their inheritance in lesser ways than how it was saved for & built.

How do you feel about leaving inheritances ?
as others have suggested, after leaving money for charities (if that was your wish) leave money behind that is paid out over time. probably the most important thing with inheritances is to be fair to the recipients. example: some people leave more money to their problem children (who have always spent all of their money and/or never saved) at the expense of their non-problem children (if you know what i mean). guess how i know that :?



you are thoughtful parent. best of luck to you!

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Rajsx
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Re: What to do with all this MONEY ?

Post by Rajsx »

jajlrajrf wrote: Tue Jul 07, 2020 9:45 am
azianbob wrote: Mon Jul 06, 2020 5:23 pm Why not create a trust for each of your children and grandchildren and for your son who is bad with finances set it up so that he can't use all of it but only get paid a monthly stipend from it and have it pass to his children upon his death?
I've seen similar sentiments expressed a few times in this thread and I'm gonna push back on it.

First off all, we don't have a lot of info about what the son was "wasting" his money on; the only example given was "signing up for an annuity in his 401(k)". In a world where we have all known people who had kids with drug problems, crushing credit card debt, or gambling problems, this like pretty small beer. Add to that there's a natural disconnect between different people about what "wasting money" means. I'm wealthier than my parents. When I tip well, or buy something they wouldn't enjoy, or when I pay to have something delivered that I could have spent an hour picking up myself, they consider that me "wasting money"; my feeling is that that hour of my time is worth much more than what I paid to have it delivered. So just because you think your son is wasting money doesn't mean it's true.

The reality is that in the long term we are all worm food, and your relationship with your son is worth more than all your money. He has no right to your money, but trying to use your dead hand to control him from beyond the grave sends an unmistakable message, and it is not a message of love; it's a message that will belittle and hurt. Of course you love your son and want what's best for him. But part of being a parent is letting your kids make their own mistakes. Allow for that, and allow for the possibility that your opinions about what he should do with his inheritance, if you give him one, are wrong, and his are right. Maybe he'll screw it all up. But shouldn't that be his choice to make?

I think creating a trust for the grandkids that is absolutely theirs is fine, but I think trying to place too many restrictions on what you're giving your son - barring some level of irresponsibility that I didn't see in this thread, such as drug abuse or gambling problems - is probably a bad call.
+ 1
I get your point, very clearly laid out & taken well. Thanks for sharing your point of view

No, son is not a Gambler or on Drugs, he is a very social kind of person, was more into Fraternities & such during under grad, but I see him trying to improve his prospects with a Masters while holding a Associate Director job at his Alma Mater & manages his expenses within his income.
He does not seem to have a handle on investments & such, but well I did not either at that stage & I have made my share of mistakes.

You are right I do not want to risk my relationship with him for some of his expenses which are peanuts in the large scheme of things. He is resisting my suggestions, so I better back off. He will learn on his dime. Thanks
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pcsrini
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Re: What to do with all this MONEY ?

Post by pcsrini »

Rajsx wrote: Tue Jul 07, 2020 11:40 am
jajlrajrf wrote: Tue Jul 07, 2020 9:45 am
azianbob wrote: Mon Jul 06, 2020 5:23 pm Why not create a trust for each of your children and grandchildren and for your son who is bad with finances set it up so that he can't use all of it but only get paid a monthly stipend from it and have it pass to his children upon his death?
I've seen similar sentiments expressed a few times in this thread and I'm gonna push back on it.

First off all, we don't have a lot of info about what the son was "wasting" his money on; the only example given was "signing up for an annuity in his 401(k)". In a world where we have all known people who had kids with drug problems, crushing credit card debt, or gambling problems, this like pretty small beer. Add to that there's a natural disconnect between different people about what "wasting money" means. I'm wealthier than my parents. When I tip well, or buy something they wouldn't enjoy, or when I pay to have something delivered that I could have spent an hour picking up myself, they consider that me "wasting money"; my feeling is that that hour of my time is worth much more than what I paid to have it delivered. So just because you think your son is wasting money doesn't mean it's true.

The reality is that in the long term we are all worm food, and your relationship with your son is worth more than all your money. He has no right to your money, but trying to use your dead hand to control him from beyond the grave sends an unmistakable message, and it is not a message of love; it's a message that will belittle and hurt. Of course you love your son and want what's best for him. But part of being a parent is letting your kids make their own mistakes. Allow for that, and allow for the possibility that your opinions about what he should do with his inheritance, if you give him one, are wrong, and his are right. Maybe he'll screw it all up. But shouldn't that be his choice to make?

I think creating a trust for the grandkids that is absolutely theirs is fine, but I think trying to place too many restrictions on what you're giving your son - barring some level of irresponsibility that I didn't see in this thread, such as drug abuse or gambling problems - is probably a bad call.
+ 1
I get your point, very clearly laid out & taken well. Thanks for sharing your point of view

No, son is not a Gambler or on Drugs, he is a very social kind of person, was more into Fraternities & such during under grad, but I see him trying to improve his prospects with a Masters while holding a Associate Director job at his Alma Mater & manages his expenses within his income.
He does not seem to have a handle on investments & such, but well I did not either at that stage & I have made my share of mistakes.

You are right I do not want to risk my relationship with him for some of his expenses which are peanuts in the large scheme of things. He is resisting my suggestions, so I better back off. He will learn on his dime. Thanks
Give your spouse and yourself a lot of credit! You have raised a strong and independent thinking young man who has the confidence to push back against his highly accomplished dad, and is blazing his own trail instead of taking perhaps the easier path and following exactly in his dads footsteps. It is immaterial whether he is right or wrong - it's a beautiful thing that he has the conviction to do what he thinks is right.
afan
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Re: What to do with all this MONEY ?

Post by afan »

Elysium wrote: Tue Jul 07, 2020 9:55 am
I haven't understood what is the purpose of an inheritance unless someone isn't capable of taking care of themselves or recipient of unforeseen negative circumstances. People who are in decent health with good enough circumstances to make their own living doesn't need or should care for an inheritance. Just my feeling, as someone who intends to reject inheritance and donate it to whoever may need it more when the time comes.
One can go from "decent health" to incapable of taking care of themselves, quite literally, in a heart beat. If someone was- at some point in time- capable of caring for themselves, then they should not be eligible for inheritance at any point thereafter, no matter what happens to them? A strange viewpoint.

Those "unforeseen negative circumstances" can happen at any time. If something were to happen to my kids, I hope their lives would be somewhat better due to the money I may be able to leave them.

If you "reject" an inheritance then you do not get to decide who gets it. In order to "donate it to whoever may need it more" you would first have to accept the inheritance.
We don't know how to beat the market on a risk-adjusted basis, and we don't know anyone that does know either | --Swedroe | We assume that markets are efficient, that prices are right | --Fama
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FIREchief
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Re: What to do with all this MONEY ?

Post by FIREchief »

Elysium wrote: Tue Jul 07, 2020 9:55 am
FIREchief wrote: Sat Jul 04, 2020 2:23 pm
KyleAAA wrote: Sat Jul 04, 2020 1:12 pm IMO it is unethical to leave large inheritances to offspring.
I haven't seen this one before! :P
I haven't understood what is the purpose of an inheritance unless someone isn't capable of taking care of themselves or recipient of unforeseen negative circumstances. People who are in decent health with good enough circumstances to make their own living doesn't need or should care for an inheritance. Just my feeling, as someone who intends to reject inheritance and donate it to whoever may need it more when the time comes.
I think afan captured my thoughts pretty well. Life happens to everybody. If we love our kids, we want to do whatever we can to help them live long, peaceful lives without having to forego needed health care, live in the streets, eat dog food, etc. Nobody knows what the future will bring. If we can leave them some funds, with robust asset protection, why not do that? In many cases, if they don't need the funds they'll wind up helping the next generation.
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.
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Re: What to do with all this MONEY ?

Post by bltn »

pcsrini wrote: Tue Jul 07, 2020 11:59 am
Rajsx wrote: Tue Jul 07, 2020 11:40 am
jajlrajrf wrote: Tue Jul 07, 2020 9:45 am
azianbob wrote: Mon Jul 06, 2020 5:23 pm Why not create a trust for each of your children and grandchildren and for your son who is bad with finances set it up so that he can't use all of it but only get paid a monthly stipend from it and have it pass to his children upon his death?
I've seen similar sentiments expressed a few times in this thread and I'm gonna push back on it.

First off all, we don't have a lot of info about what the son was "wasting" his money on; the only example given was "signing up for an annuity in his 401(k)". In a world where we have all known people who had kids with drug problems, crushing credit card debt, or gambling problems, this like pretty small beer. Add to that there's a natural disconnect between different people about what "wasting money" means. I'm wealthier than my parents. When I tip well, or buy something they wouldn't enjoy, or when I pay to have something delivered that I could have spent an hour picking up myself, they consider that me "wasting money"; my feeling is that that hour of my time is worth much more than what I paid to have it delivered. So just because you think your son is wasting money doesn't mean it's true.

The reality is that in the long term we are all worm food, and your relationship with your son is worth more than all your money. He has no right to your money, but trying to use your dead hand to control him from beyond the grave sends an unmistakable message, and it is not a message of love; it's a message that will belittle and hurt. Of course you love your son and want what's best for him. But part of being a parent is letting your kids make their own mistakes. Allow for that, and allow for the possibility that your opinions about what he should do with his inheritance, if you give him one, are wrong, and his are right. Maybe he'll screw it all up. But shouldn't that be his choice to make?

I think creating a trust for the grandkids that is absolutely theirs is fine, but I think trying to place too many restrictions on what you're giving your son - barring some level of irresponsibility that I didn't see in this thread, such as drug abuse or gambling problems - is probably a bad call.
+ 1
I get your point, very clearly laid out & taken well. Thanks for sharing your point of view

No, son is not a Gambler or on Drugs, he is a very social kind of person, was more into Fraternities & such during under grad, but I see him trying to improve his prospects with a Masters while holding a Associate Director job at his Alma Mater & manages his expenses within his income.
He does not seem to have a handle on investments & such, but well I did not either at that stage & I have made my share of mistakes.

You are right I do not want to risk my relationship with him for some of his expenses which are peanuts in the large scheme of things. He is resisting my suggestions, so I better back off. He will learn on his dime. Thanks
Give your spouse and yourself a lot of credit! You have raised a strong and independent thinking young man who has the confidence to push back against his highly accomplished dad, and is blazing his own trail instead of taking perhaps the easier path and following exactly in his dads footsteps. It is immaterial whether he is right or wrong - it's a beautiful thing that he has the conviction to do what he thinks is right.
Interesting than one could think that following a father s footsteps into the practice of medicine is “perhaps the easier path “. Having two children that finished medical school and are now in residency training, I feel qualified to say that training to practice medicine is probably the most difficult education process in our current society.
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Re: What to do with all this MONEY ?

Post by pcsrini »

bltn wrote: Tue Jul 07, 2020 1:47 pm
pcsrini wrote: Tue Jul 07, 2020 11:59 am
Rajsx wrote: Tue Jul 07, 2020 11:40 am
jajlrajrf wrote: Tue Jul 07, 2020 9:45 am
azianbob wrote: Mon Jul 06, 2020 5:23 pm Why not create a trust for each of your children and grandchildren and for your son who is bad with finances set it up so that he can't use all of it but only get paid a monthly stipend from it and have it pass to his children upon his death?
I've seen similar sentiments expressed a few times in this thread and I'm gonna push back on it.

First off all, we don't have a lot of info about what the son was "wasting" his money on; the only example given was "signing up for an annuity in his 401(k)". In a world where we have all known people who had kids with drug problems, crushing credit card debt, or gambling problems, this like pretty small beer. Add to that there's a natural disconnect between different people about what "wasting money" means. I'm wealthier than my parents. When I tip well, or buy something they wouldn't enjoy, or when I pay to have something delivered that I could have spent an hour picking up myself, they consider that me "wasting money"; my feeling is that that hour of my time is worth much more than what I paid to have it delivered. So just because you think your son is wasting money doesn't mean it's true.

The reality is that in the long term we are all worm food, and your relationship with your son is worth more than all your money. He has no right to your money, but trying to use your dead hand to control him from beyond the grave sends an unmistakable message, and it is not a message of love; it's a message that will belittle and hurt. Of course you love your son and want what's best for him. But part of being a parent is letting your kids make their own mistakes. Allow for that, and allow for the possibility that your opinions about what he should do with his inheritance, if you give him one, are wrong, and his are right. Maybe he'll screw it all up. But shouldn't that be his choice to make?

I think creating a trust for the grandkids that is absolutely theirs is fine, but I think trying to place too many restrictions on what you're giving your son - barring some level of irresponsibility that I didn't see in this thread, such as drug abuse or gambling problems - is probably a bad call.
+ 1
I get your point, very clearly laid out & taken well. Thanks for sharing your point of view

No, son is not a Gambler or on Drugs, he is a very social kind of person, was more into Fraternities & such during under grad, but I see him trying to improve his prospects with a Masters while holding a Associate Director job at his Alma Mater & manages his expenses within his income.
He does not seem to have a handle on investments & such, but well I did not either at that stage & I have made my share of mistakes.

You are right I do not want to risk my relationship with him for some of his expenses which are peanuts in the large scheme of things. He is resisting my suggestions, so I better back off. He will learn on his dime. Thanks
Give your spouse and yourself a lot of credit! You have raised a strong and independent thinking young man who has the confidence to push back against his highly accomplished dad, and is blazing his own trail instead of taking perhaps the easier path and following exactly in his dads footsteps. It is immaterial whether he is right or wrong - it's a beautiful thing that he has the conviction to do what he thinks is right.
Interesting than one could think that following a father s footsteps into the practice of medicine is “perhaps the easier path “. Having two children that finished medical school and are now in residency training, I feel qualified to say that training to practice medicine is probably the most difficult education process in our current society.
Sorry, that did not come out right and absolutely no disrespect. We have a number of accomplished doctors in our family across generations, and I absolutely know how difficult that path is. I meant it purely from the perspective of choosing a completely different path from the one that you have grown up with and know well. Other paths also have their own difficulties, and not having the wisdom of someone who has already been down that road can be challenging. Doctors and medical professionals are amazing, and the deserve all the respect they get! Kudos to you and your children for choosing this difficult path.
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Re: What to do with all this MONEY ?

Post by azianbob »

I'm just saying if my child refused to learn about investing and finances then I will not let them full access to their inheritance, but instead set it up so that they just get an allowance from it. I've seen too many examples of parents saying "let them learn from their own mistakes" and the kids blow all their inheritance on some crazy idea or investment and become broke when they could of been financially secure for the rest of their lives and maybe even retire early.

If they are a bad person I wouldn't even leave them any money.
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Re: What to do with all this MONEY ?

Post by KyleAAA »

azianbob wrote: Tue Jul 07, 2020 2:23 pm I'm just saying if my child refused to learn about investing and finances then I will not let them full access to their inheritance, but instead set it up so that they just get an allowance from it. I've seen too many examples of parents saying "let them learn from their own mistakes" and the kids blow all their inheritance on some crazy idea or investment and become broke when they could of been financially secure for the rest of their lives and maybe even retire early.

If they are a bad person I wouldn't even leave them any money.
Why is it a bad thing if they become broke? People value different things. Let them blow it on some crazy idea if they want. Financial security is dramatically over-rated IME.

But then, I believe large inheritances in general are unethical. Define "large" however you wish.
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Re: What to do with all this MONEY ?

Post by JackoC »

KyleAAA wrote: Tue Jul 07, 2020 3:32 pm
azianbob wrote: Tue Jul 07, 2020 2:23 pm I'm just saying if my child refused to learn about investing and finances then I will not let them full access to their inheritance, but instead set it up so that they just get an allowance from it. I've seen too many examples of parents saying "let them learn from their own mistakes" and the kids blow all their inheritance on some crazy idea or investment and become broke when they could of been financially secure for the rest of their lives and maybe even retire early.

If they are a bad person I wouldn't even leave them any money.
Why is it a bad thing if they become broke? People value different things. Let them blow it on some crazy idea if they want. Financial security is dramatically over-rated IME.

But then, I believe large inheritances in general are unethical. Define "large" however you wish.
Now that you have repeated that, I'll say I find the use of the term 'unethical' there to be objectionable. 'Unethical' has an accusatory connotation, which I'm not saying you specifically intend, but it's there nonetheless and the reason for that connotation is the term has been generally applied to widely shared moral/ethical principals. Longstanding traditional ethical principles say no such thing.

Those can change over time, but start out as socio-political opinions, which is what you are stating rather than a matter of ethics as properly understood. It's not a new opinion, rather a common one mainly on one side of the political spectrum for a long time, that large inter-generational transfers of wealth are a social negative (that's actually anyone's business besides the person leaving the money). It's not unethical for you to hold that socio-political opinion, nor unethical of me to disagree with it. :happy
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Re: What to do with all this MONEY ?

Post by KyleAAA »

JackoC wrote: Tue Jul 07, 2020 5:36 pm
KyleAAA wrote: Tue Jul 07, 2020 3:32 pm
azianbob wrote: Tue Jul 07, 2020 2:23 pm I'm just saying if my child refused to learn about investing and finances then I will not let them full access to their inheritance, but instead set it up so that they just get an allowance from it. I've seen too many examples of parents saying "let them learn from their own mistakes" and the kids blow all their inheritance on some crazy idea or investment and become broke when they could of been financially secure for the rest of their lives and maybe even retire early.

If they are a bad person I wouldn't even leave them any money.
Why is it a bad thing if they become broke? People value different things. Let them blow it on some crazy idea if they want. Financial security is dramatically over-rated IME.

But then, I believe large inheritances in general are unethical. Define "large" however you wish.
Now that you have repeated that, I'll say I find the use of the term 'unethical' there to be objectionable. 'Unethical' has an accusatory connotation, which I'm not saying you specifically intend, but it's there nonetheless and the reason for that connotation is the term has been generally applied to widely shared moral/ethical principals. Longstanding traditional ethical principles say no such thing.

Those can change over time, but start out as socio-political opinions, which is what you are stating rather than a matter of ethics as properly understood. It's not a new opinion, rather a common one mainly on one side of the political spectrum for a long time, that large inter-generational transfers of wealth are a social negative (that's actually anyone's business besides the person leaving the money). It's not unethical for you to hold that socio-political opinion, nor unethical of me to disagree with it. :happy
I believe they are immoral and are certainly contrary to long-standing ethical principles of fairness and equality.
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Re: What to do with all this MONEY ?

Post by unclescrooge »

TomatoTomahto wrote: Fri Jul 03, 2020 3:07 pm Not doctors, but also not entirely different situation.

My wife and I disagree somewhat on the topic, but mainly in terms of “how much” rather than “whether.” I think some number per heir is sufficient with the remainder to charity, and my wife sort of calculates it the other way ($x to charity; kids get the rest).
You are both right. And you should do whatever you want with your half.
Unless you die first. Then we both know how that will play out. :mrgreen:
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Re: What to do with all this MONEY ?

Post by TomatoTomahto »

unclescrooge wrote: Tue Jul 07, 2020 6:19 pm
TomatoTomahto wrote: Fri Jul 03, 2020 3:07 pm Not doctors, but also not entirely different situation.

My wife and I disagree somewhat on the topic, but mainly in terms of “how much” rather than “whether.” I think some number per heir is sufficient with the remainder to charity, and my wife sort of calculates it the other way ($x to charity; kids get the rest).
You are both right. And you should do whatever you want with your half.
Unless you die first. Then we both know how that will play out. :mrgreen:
Actually, that’s one of the benefits of setting up trusts. Our wishes are memorialized and what we say in the legal documents rules (within legal bounds of course). Based on ages, gender, and family history, I’m an odds on favorite to die first.
I get the FI part but not the RE part of FIRE.
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Re: What to do with all this MONEY ?

Post by FIREchief »

KyleAAA wrote: Tue Jul 07, 2020 3:32 pm Financial security is dramatically over-rated IME.
What??!! :oops:
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.
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Re: What to do with all this MONEY ?

Post by RocketShipTech »

FIREchief wrote: Tue Jul 07, 2020 10:38 pm
KyleAAA wrote: Tue Jul 07, 2020 3:32 pm Financial security is dramatically over-rated IME.
What??!! :oops:
How many people have abandoned their dreams for a path of “financial security” only to realize they probably would have been fine financially anyway? So you end up with a pile of money and pile of life regret.
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FIREchief
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Re: What to do with all this MONEY ?

Post by FIREchief »

RocketShipTech wrote: Tue Jul 07, 2020 10:42 pm
FIREchief wrote: Tue Jul 07, 2020 10:38 pm
KyleAAA wrote: Tue Jul 07, 2020 3:32 pm Financial security is dramatically over-rated IME.
What??!! :oops:
How many people have abandoned their dreams for a path of “financial security” only to realize they probably would have been fine financially anyway? So you end up with a pile of money and pile of life regret.
"Probably" not broke at 60? This has become a very interesting thread. FIRE does not stand for "Financially independent - regretting everything" :P
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Re: What to do with all this MONEY ?

Post by AlphaLess »

Congrats!

Sounds like your limiting factor is not money, LBYM, or anything having to do with finances.

Rather, you need to instill some financial discipline in your kids.

Given that they are grown, this would be hard to do.

But you can still try.

Another limiting factor is lifespan. I would seriously consider ways to increase your lifespan. Adding 5, maybe even 10 years to your lives at this point could be possible.
"A Republic, if you can keep it". Benjamin Franklin. 1787. | Party affiliation: Vanguard. Religion: low-cost investing.
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Re: What to do with all this MONEY ?

Post by oldcomputerguy »

A couple of off-topic posts were removed. As a reminder, see Non-actionable (Trolling) Topics:
If readers can't do anything with the content of a topic other than argue about it, it does not belong here. Examples include:

- US or world economic, political, tax, health care and climate policies
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Re: What to do with all this MONEY ?

Post by ponyboy »

You can set up a trust to only pay out a certain amount to your son for the rest of his life. $25k/year? If he sucks with money, I wouldnt give him too much to blow, especially all at once.
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Re: What to do with all this MONEY ?

Post by afan »

Much better to have a trustee with discretion about when and how much to distribute.
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Re: What to do with all this MONEY ?

Post by vested1 »

KyleAAA wrote: Sat Jul 04, 2020 1:12 pm IMO it is unethical to leave large inheritances to offspring.
It depends on the motive of the giver, and the ability of the child to treat it responsibly. I knew of a family whose every member was obsessed with getting an inheritance, and whenever someone died the vultures would descend, with judgements being made as to why so and so got this or that or why so and so got stiffed. Very ugly scenes ensued at the home of the recently deceased, with furniture and belongings disappearing as if by magic. That institutionalized method of inheritance was unethical, because it was invariably the end result of all seniors in the family using the promise of an inheritance as an unreachable carrot on the end of a very long stick.

I know someone else in a different family who is recently divorced at age 60, has zero retirement savings, and is expecting an inheritance of about 150k soon. He was a sad excuse for a father, and has told his two children that he will split all of the inheritance between them, taking nothing for himself, and if the younger one (16) will come live with him 2,500 miles away from her mother's home where she now lives, he will buy her a new car. He is obviously using an inheritance and what little money he has in an attempt to buy his children's love. That is not only unethical, but betrays a self-serving motive.

These two examples may be the aberration however, as most parents have only the best wishes for their offspring and an honest desire to make their children's lives better than their own.

Much like the decision of when to claim SS, the decision on how/whether to leave an inheritance depends entirely on personal circumstances. What may be unethical for one may be admirable for another.
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Re: What to do with all this MONEY ?

Post by KyleAAA »

vested1 wrote: Wed Jul 08, 2020 12:04 pm
KyleAAA wrote: Sat Jul 04, 2020 1:12 pm IMO it is unethical to leave large inheritances to offspring.
It depends on the motive of the giver, and the ability of the child to treat it responsibly. I knew of a family whose every member was obsessed with getting an inheritance, and whenever someone died the vultures would descend, with judgements being made as to why so and so got this or that or why so and so got stiffed. Very ugly scenes ensued at the home of the recently deceased, with furniture and belongings disappearing as if by magic. That institutionalized method of inheritance was unethical, because it was invariably the end result of all seniors in the family using the promise of an inheritance as an unreachable carrot on the end of a very long stick.

I know someone else in a different family who is recently divorced at age 60, has zero retirement savings, and is expecting an inheritance of about 150k soon. He was a sad excuse for a father, and has told his two children that he will split all of the inheritance between them, taking nothing for himself, and if the younger one (16) will come live with him 2,500 miles away from her mother's home where she now lives, he will buy her a new car. He is obviously using an inheritance and what little money he has in an attempt to buy his children's love. That is not only unethical, but betrays a self-serving motive.

These two examples may be the aberration however, as most parents have only the best wishes for their offspring and an honest desire to make their children's lives better than their own.

Much like the decision of when to claim SS, the decision on how/whether to leave an inheritance depends entirely on personal circumstances. What may be unethical for one may be admirable for another.
No, I believe it is immoral in all circumstances. Wanting to make your children's lives better is all well and good, but that does not mean everything done to that end is automatically moral. It doesn't take much of an imagination to come up with any number of examples.
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Re: What to do with all this MONEY ?

Post by unclescrooge »

KyleAAA wrote: Wed Jul 08, 2020 2:31 pm
vested1 wrote: Wed Jul 08, 2020 12:04 pm
KyleAAA wrote: Sat Jul 04, 2020 1:12 pm IMO it is unethical to leave large inheritances to offspring.
It depends on the motive of the giver, and the ability of the child to treat it responsibly. I knew of a family whose every member was obsessed with getting an inheritance, and whenever someone died the vultures would descend, with judgements being made as to why so and so got this or that or why so and so got stiffed. Very ugly scenes ensued at the home of the recently deceased, with furniture and belongings disappearing as if by magic. That institutionalized method of inheritance was unethical, because it was invariably the end result of all seniors in the family using the promise of an inheritance as an unreachable carrot on the end of a very long stick.
No, I believe it is immoral in all circumstances. Wanting to make your children's lives better is all well and good, but that does not mean everything done to that end is automatically moral. It doesn't take much of an imagination to come up with any number of examples.
I agree with you. You should leave all YOUR money to charity. :mrgreen:
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Re: What to do with all this MONEY ?

Post by KyleAAA »

unclescrooge wrote: Wed Jul 08, 2020 3:45 pm
KyleAAA wrote: Wed Jul 08, 2020 2:31 pm
vested1 wrote: Wed Jul 08, 2020 12:04 pm
KyleAAA wrote: Sat Jul 04, 2020 1:12 pm IMO it is unethical to leave large inheritances to offspring.
It depends on the motive of the giver, and the ability of the child to treat it responsibly. I knew of a family whose every member was obsessed with getting an inheritance, and whenever someone died the vultures would descend, with judgements being made as to why so and so got this or that or why so and so got stiffed. Very ugly scenes ensued at the home of the recently deceased, with furniture and belongings disappearing as if by magic. That institutionalized method of inheritance was unethical, because it was invariably the end result of all seniors in the family using the promise of an inheritance as an unreachable carrot on the end of a very long stick.
No, I believe it is immoral in all circumstances. Wanting to make your children's lives better is all well and good, but that does not mean everything done to that end is automatically moral. It doesn't take much of an imagination to come up with any number of examples.
I agree with you. You should leave all YOUR money to charity. :mrgreen:
How would that address my concern?
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Re: What to do with all this MONEY ?

Post by unclescrooge »

KyleAAA wrote: Wed Jul 08, 2020 4:13 pm
unclescrooge wrote: Wed Jul 08, 2020 3:45 pm
KyleAAA wrote: Wed Jul 08, 2020 2:31 pm
vested1 wrote: Wed Jul 08, 2020 12:04 pm
KyleAAA wrote: Sat Jul 04, 2020 1:12 pm IMO it is unethical to leave large inheritances to offspring.
It depends on the motive of the giver, and the ability of the child to treat it responsibly. I knew of a family whose every member was obsessed with getting an inheritance, and whenever someone died the vultures would descend, with judgements being made as to why so and so got this or that or why so and so got stiffed. Very ugly scenes ensued at the home of the recently deceased, with furniture and belongings disappearing as if by magic. That institutionalized method of inheritance was unethical, because it was invariably the end result of all seniors in the family using the promise of an inheritance as an unreachable carrot on the end of a very long stick.
No, I believe it is immoral in all circumstances. Wanting to make your children's lives better is all well and good, but that does not mean everything done to that end is automatically moral. It doesn't take much of an imagination to come up with any number of examples.
I agree with you. You should leave all YOUR money to charity. :mrgreen:
How would that address my concern?
What concern would that be? I thought you made a statement.
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Re: What to do with all this MONEY ?

Post by FIREchief »

KyleAAA wrote: Wed Jul 08, 2020 2:31 pm
vested1 wrote: Wed Jul 08, 2020 12:04 pm
KyleAAA wrote: Sat Jul 04, 2020 1:12 pm IMO it is unethical to leave large inheritances to offspring.
It depends on the motive of the giver, and the ability of the child to treat it responsibly. I knew of a family whose every member was obsessed with getting an inheritance, and whenever someone died the vultures would descend, with judgements being made as to why so and so got this or that or why so and so got stiffed. Very ugly scenes ensued at the home of the recently deceased, with furniture and belongings disappearing as if by magic. That institutionalized method of inheritance was unethical, because it was invariably the end result of all seniors in the family using the promise of an inheritance as an unreachable carrot on the end of a very long stick.

I know someone else in a different family who is recently divorced at age 60, has zero retirement savings, and is expecting an inheritance of about 150k soon. He was a sad excuse for a father, and has told his two children that he will split all of the inheritance between them, taking nothing for himself, and if the younger one (16) will come live with him 2,500 miles away from her mother's home where she now lives, he will buy her a new car. He is obviously using an inheritance and what little money he has in an attempt to buy his children's love. That is not only unethical, but betrays a self-serving motive.

These two examples may be the aberration however, as most parents have only the best wishes for their offspring and an honest desire to make their children's lives better than their own.

Much like the decision of when to claim SS, the decision on how/whether to leave an inheritance depends entirely on personal circumstances. What may be unethical for one may be admirable for another.
No, I believe it is immoral in all circumstances. Wanting to make your children's lives better is all well and good, but that does not mean everything done to that end is automatically moral. It doesn't take much of an imagination to come up with any number of examples.
Where does this end? If I take my kids to McDonalds for lunch, do I need to buy a gift card for the neighbor's kids for the same amount if their parents aren't employed? You mentioned "large inheritances." Would you care to share with us what constitutes "large" in your opinion? Is it $100K? $1M? $10M? You also mentioned "offspring." Is it no longer unethical if I leave an inheritance to somebody else's offspring? Is charity okay, or is that only ethical if the charity is a certain kind of charity? Can I leave it to my church? Or is that somehow insulting to those who don't share my faith? Is world hunger okay? I just want to understand exactly what the thoughts are behind your statements (assuming you gave them some thought before posting).
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.
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Re: What to do with all this MONEY ?

Post by Toons »

kjvmartin wrote: Fri Jul 03, 2020 4:18 pm My grandfather passed with a seven figure net worth.

He was very frugal and no one would have ever guessed his net worth earned based on his possessions. Local government pension and held dividend utility stocks.

A cautionary tale about legacy: Other than advice, he never helped a living relative financially for 88 years. We are talking when dirt-floor-poor teenage grandson bikes over lunch, he would break out the calculator to split the cost. You sound a bit more generous. On the other hand, my grandmother (his ex wife) had no bank account at death but would give you the shirt off her back (she probably bought it on sale, lol).

Let me tell you which one was taken in by the kids and which one passed in a nursing home. I implore you, make a real difference in the lives of your relatives while you're there to see the smiles on their faces.

Bravo!
:mrgreen:
"One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity" –Bruce Lee
KyleAAA
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Re: What to do with all this MONEY ?

Post by KyleAAA »

FIREchief wrote: Wed Jul 08, 2020 4:55 pm
KyleAAA wrote: Wed Jul 08, 2020 2:31 pm
vested1 wrote: Wed Jul 08, 2020 12:04 pm
KyleAAA wrote: Sat Jul 04, 2020 1:12 pm IMO it is unethical to leave large inheritances to offspring.
It depends on the motive of the giver, and the ability of the child to treat it responsibly. I knew of a family whose every member was obsessed with getting an inheritance, and whenever someone died the vultures would descend, with judgements being made as to why so and so got this or that or why so and so got stiffed. Very ugly scenes ensued at the home of the recently deceased, with furniture and belongings disappearing as if by magic. That institutionalized method of inheritance was unethical, because it was invariably the end result of all seniors in the family using the promise of an inheritance as an unreachable carrot on the end of a very long stick.

I know someone else in a different family who is recently divorced at age 60, has zero retirement savings, and is expecting an inheritance of about 150k soon. He was a sad excuse for a father, and has told his two children that he will split all of the inheritance between them, taking nothing for himself, and if the younger one (16) will come live with him 2,500 miles away from her mother's home where she now lives, he will buy her a new car. He is obviously using an inheritance and what little money he has in an attempt to buy his children's love. That is not only unethical, but betrays a self-serving motive.

These two examples may be the aberration however, as most parents have only the best wishes for their offspring and an honest desire to make their children's lives better than their own.

Much like the decision of when to claim SS, the decision on how/whether to leave an inheritance depends entirely on personal circumstances. What may be unethical for one may be admirable for another.
No, I believe it is immoral in all circumstances. Wanting to make your children's lives better is all well and good, but that does not mean everything done to that end is automatically moral. It doesn't take much of an imagination to come up with any number of examples.
Where does this end? If I take my kids to McDonalds for lunch, do I need to buy a gift card for the neighbor's kids for the same amount if their parents aren't employed? You mentioned "large inheritances." Would you care to share with us what constitutes "large" in your opinion? Is it $100K? $1M? $10M? You also mentioned "offspring." Is it no longer unethical if I leave an inheritance to somebody else's offspring? Is charity okay, or is that only ethical if the charity is a certain kind of charity? Can I leave it to my church? Or is that somehow insulting to those who don't share my faith? Is world hunger okay? I just want to understand exactly what the thoughts are behind your statements (assuming you gave them some thought before posting).
Actions that violate the ethical principles of fairness and equality are unethical. You can work out for yourself how that applies to each of the situations you mentioned. Giving any individual $100m clearly violates those principles. Giving them $100k might, or it might not. Depending on what the charity does with the money and in what context, something unethical could be going on. But probably not. Anything that serves to systematically widen the gap between where privileged and unprivileged individuals start the race is, in general but with plenty of caveats, unethical. Judgements cannot be made absent broader context. But inheritance is unambiguously one of those things.
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FIREchief
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Re: What to do with all this MONEY ?

Post by FIREchief »

KyleAAA wrote: Wed Jul 08, 2020 6:25 pm Anything that serves to systematically widen the gap between where privileged and unprivileged individuals start the race is, in general but with plenty of caveats, unethical. Judgements cannot be made absent broader context. But inheritance is unambiguously one of those things.
When does the "race" start for my child? Is it the day he is born? The day he turns 18? How about the day he turns 55? If I pay for my child to attend college, have I just done something unethical because I've systematically widened the gap with my neighbor's kid who can't afford college? If I help with a house down payment, have I been unethical because I've allowed him to buy a house while his buddy can't come up with a down payment? If I leave him an inheritance when he is 55 with failing health that might prevent him from working another 10 - 15 years have I done something unethical because he'll be able to finish the race without winding up on the street or eating dog food? YIkes!! If we can't love and provide for them, why have kids in the first place???
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.
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8foot7
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Re: What to do with all this MONEY ?

Post by 8foot7 »

KyleAAA wrote: Wed Jul 08, 2020 6:25 pm
Actions that violate the ethical principles of fairness and equality are unethical.
Would love to see where these particular "ethical principles" are defined and described and on whose authority they exist. Is this a particular religion? Is this based on some text?
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goodenyou
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Re: What to do with all this MONEY ?

Post by goodenyou »

FIREchief wrote: Wed Jul 08, 2020 6:36 pm
KyleAAA wrote: Wed Jul 08, 2020 6:25 pm Anything that serves to systematically widen the gap between where privileged and unprivileged individuals start the race is, in general but with plenty of caveats, unethical. Judgements cannot be made absent broader context. But inheritance is unambiguously one of those things.
When does the "race" start for my child? Is it the day he is born? The day he turns 18? How about the day he turns 55? If I pay for my child to attend college, have I just done something unethical because I've systematically widened the gap with my neighbor's kid who can't afford college? If I help with a house down payment, have I been unethical because I've allowed him to buy a house while his buddy can't come up with a down payment? If I leave him an inheritance when he is 55 with failing health that might prevent him from working another 10 - 15 years have I done something unethical because he'll be able to finish the race without winding up on the street or eating dog food? YIkes!! If we can't love and provide for them, why have kids in the first place???
This may help you answer your questions before the inevitable lock on this thread.

https://www.youtube.com/watch?v=MRpEV2tmYz4
"Ignorance more frequently begets confidence than does knowledge" | “Do you know how to make a rain dance work? Dance until it rains”
Normchad
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Re: What to do with all this MONEY ?

Post by Normchad »

KyleAAA wrote: Wed Jul 08, 2020 6:25 pm
FIREchief wrote: Wed Jul 08, 2020 4:55 pm
KyleAAA wrote: Wed Jul 08, 2020 2:31 pm
vested1 wrote: Wed Jul 08, 2020 12:04 pm
KyleAAA wrote: Sat Jul 04, 2020 1:12 pm IMO it is unethical to leave large inheritances to offspring.
It depends on the motive of the giver, and the ability of the child to treat it responsibly. I knew of a family whose every member was obsessed with getting an inheritance, and whenever someone died the vultures would descend, with judgements being made as to why so and so got this or that or why so and so got stiffed. Very ugly scenes ensued at the home of the recently deceased, with furniture and belongings disappearing as if by magic. That institutionalized method of inheritance was unethical, because it was invariably the end result of all seniors in the family using the promise of an inheritance as an unreachable carrot on the end of a very long stick.

I know someone else in a different family who is recently divorced at age 60, has zero retirement savings, and is expecting an inheritance of about 150k soon. He was a sad excuse for a father, and has told his two children that he will split all of the inheritance between them, taking nothing for himself, and if the younger one (16) will come live with him 2,500 miles away from her mother's home where she now lives, he will buy her a new car. He is obviously using an inheritance and what little money he has in an attempt to buy his children's love. That is not only unethical, but betrays a self-serving motive.

These two examples may be the aberration however, as most parents have only the best wishes for their offspring and an honest desire to make their children's lives better than their own.

Much like the decision of when to claim SS, the decision on how/whether to leave an inheritance depends entirely on personal circumstances. What may be unethical for one may be admirable for another.
No, I believe it is immoral in all circumstances. Wanting to make your children's lives better is all well and good, but that does not mean everything done to that end is automatically moral. It doesn't take much of an imagination to come up with any number of examples.
Where does this end? If I take my kids to McDonalds for lunch, do I need to buy a gift card for the neighbor's kids for the same amount if their parents aren't employed? You mentioned "large inheritances." Would you care to share with us what constitutes "large" in your opinion? Is it $100K? $1M? $10M? You also mentioned "offspring." Is it no longer unethical if I leave an inheritance to somebody else's offspring? Is charity okay, or is that only ethical if the charity is a certain kind of charity? Can I leave it to my church? Or is that somehow insulting to those who don't share my faith? Is world hunger okay? I just want to understand exactly what the thoughts are behind your statements (assuming you gave them some thought before posting).
Actions that violate the ethical principles of fairness and equality are unethical. You can work out for yourself how that applies to each of the situations you mentioned. Giving any individual $100m clearly violates those principles. Giving them $100k might, or it might not. Depending on what the charity does with the money and in what context, something unethical could be going on. But probably not. Anything that serves to systematically widen the gap between where privileged and unprivileged individuals start the race is, in general but with plenty of caveats, unethical. Judgements cannot be made absent broader context. But inheritance is unambiguously one of those things.
I don't know this KyleAAA fellow, but I like the cut of his jib! I agree whole-heartedly.

I never thought about it in quite those terms; but had a similar conclusion. I wouldn't want to leave my kid so much money that it would be detrimental to them.
SlowlySaving
Posts: 66
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Re: What to do with all this MONEY ?

Post by SlowlySaving »

Mr.BB wrote: Fri Jul 03, 2020 3:16 pm Let me recommend a book for you (and others) to read, especially after everything we have all gone through this past year. "30 Lessons for Living" basically it is an interview with hundreds of older adults and the lessons they have learned over the years; it is great! One of items that most of people interviewed agreed on, no matter what their age, economic situation, etc. is that they wished they had traveled more (including people who were world travelers). You and your wife have worked hard to get where you are and should enjoy all the pleasures of life (including first-class seats), life is to short for coach or economy when you don't need to

You should also look at investing in your health (if you are not already), especially with diabetes. Work with a personal trainer, nutritionist, etc. One of my favorite quotes is "Take care of your body, it's the only place you have to live."~ Jim Rohn
I am totally going to check out this book, thanks for the referral!
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unclescrooge
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Re: What to do with all this MONEY ?

Post by unclescrooge »

goodenyou wrote: Wed Jul 08, 2020 6:44 pm
FIREchief wrote: Wed Jul 08, 2020 6:36 pm
KyleAAA wrote: Wed Jul 08, 2020 6:25 pm Anything that serves to systematically widen the gap between where privileged and unprivileged individuals start the race is, in general but with plenty of caveats, unethical. Judgements cannot be made absent broader context. But inheritance is unambiguously one of those things.
When does the "race" start for my child? Is it the day he is born? The day he turns 18? How about the day he turns 55? If I pay for my child to attend college, have I just done something unethical because I've systematically widened the gap with my neighbor's kid who can't afford college? If I help with a house down payment, have I been unethical because I've allowed him to buy a house while his buddy can't come up with a down payment? If I leave him an inheritance when he is 55 with failing health that might prevent him from working another 10 - 15 years have I done something unethical because he'll be able to finish the race without winding up on the street or eating dog food? YIkes!! If we can't love and provide for them, why have kids in the first place???
This may help you answer your questions before the inevitable lock on this thread.

https://www.youtube.com/watch?v=MRpEV2tmYz4
great video. thanks for posting!
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unclescrooge
Posts: 5498
Joined: Thu Jun 07, 2012 7:00 pm

Re: What to do with all this MONEY ?

Post by unclescrooge »

anoop wrote: Mon Jul 06, 2020 4:46 pm It's like when you get to the top of the mountain and discover that the most satisfying part was the journey getting there. :)

I don't have any advice for you because I'm still climbing and probably will never make it to the summit.
Hopefully, there will be some nice vista points along the way!
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