Monday, October 29, 2007

Notes from a Family Weekend

I was visiting family this weekend... If you're a relative newcomer to this site, just click on the category "family" to get a tiny sampling of the kind of angst-ridden financial tizzy a family visit can get me into!

This time there were a few items of note:

1) My sister, who I thought had paid for my niece's pre-school with a credit card, turns out to have been given some money for it by my father. She has also had my mother's car on a semi-permanent loan for the last few months, and needless to say, she is not paying my father for the lease. I know it is tough to raise kids in an expensive suburb, but sometimes I can't help feeling a bit disgruntled that when she and her husband overextend themselves, the family comes to the rescue, while everyone just thinks I've got everything sorted out and can take care of myself. And I CAN take care of myself, and want to take care of myself... but if there's money to be handed out to cover non-emergency expenses, I wouldn't mind seeing a bit of it, selfish wench that I am.

2) My father spent $130 on a new shaving brush, and added a fancy new razor (also expensive though I don't know exactly how much) to his order from whatever obscure British shaving supply company he bought it from. My dad has never been so over-the-top frugal as to deny himself a few luxuries, but this one was surprising to me. He has also been allowing himself more bottles of expensive wines to supplement his usual cheap wines. His attitude in the last few years has been one of extreme penny-pinching martyrdom, because of the enormous credit card debts he's had to bail my mother out of, twice. So what does it mean that he is now giving himself more of a break? He had some papers on the floor in the living room-- I could see the edge of one and it was clear that it was a statement of his retirement account from his employer. So of course I peeked: the date was almost a year ago and the balance was under $200,000. I know he also gets a pension and social security, but I don't know what other assets he has. He's in his early 70s, and has a lot of health problems but they are less threatening to his life than to his quality of life, I think. Both his parents lived into their 90s. Is he okay financially, or not okay? I have no idea. But the fact that he seems to have loosened his standards of frugality almost alarmed me. It seemed as though he might have thrown in the towel, basically. Perhaps his health issues are worse than I thought-- he is always depressed about his illnesses, but maybe there is more to it. If he is allowing himself expensive luxuries, especially one such as wine, which he really shouldn't be consuming in more than tiny amounts, does it mean he doesn't care any more, because he thinks he won't live much longer? Is he just learning to lighten up a bit, or is this almost a sign of suicidal depression? This may sound alarmist and melodramatic on my part, but to make a long story short, if you knew my dad, you might have the same thoughts.

3) I found a photo album with pictures of my high school graduation, as well as one of the first letters I wrote home during my freshman year of college. Here's how the letter began:

I decided to write instead of call-- since my initiation to the world of debt, I've been very money conscious. I also decided today that I'm not going to buy any more food at [a campus convenience store]. Their prices are outrageous and B [my roommate] says there is a real grocery store somewhere.

I'm always a little surprised when I realize the preoccupation with financial security that I thought had hit me in my late 20s and 30s was actually well established at a much earlier age!

4) As always, I had a great time playing with my niece and nephew. We played pizza restaurant, birthday party, monster attack, knock-Auntie-X-over and a variety of other games, including a new one: shoe store. My niece sold the shoes and my nephew played my butler, who carried home my purchases for me. I also instructed him to take some of the play money (post-its scribbled on by my niece) out of my pocket and put it in the bank, and then to take some out of the bank to pay for another pair of shoes. I have to start early with these kids!


VixenOnABudget said...

When I was younger, the only way I'd play barbies with my little sister was if we used play money. Like, I seriously made tiny barbie-sized money with values concurrent with real dollar values on them (1, 5, 10, 20).

What an early sign of my preoccupation with money.

Anonymous said...

It's kind of scary to consider your parents wealth management, isn't it?

My in-laws have bailed out my sister-in-law BIG time. Helping her escape an abusive husband (great), helping pay for her apartment while she got on her feet (ok), holding the mortgage on buying and renovating a house with her then boyfriend (umm not so good), her breaking up with said boyfriend who ripped the house apart and leaving my in-laws to pay to put it back together (really bad).

They are in their late 60s/early 70s. They are not made of money and have lived a frugal lifestyle their whole lives. If something were to happen to them it would be up to us as the only stable working poeple to help out. (NOT currently in my financial plans)

We wonder if we should have a 'heart to heart' to get to the bottom of their situation -- or do we just stay out of it all.

Grown-ups -- man they are scary....

Anonymous said...

$100-200K for someone with social security AND a pension is prob not bad IF they don't splurge. The big expense for older people is healthcare. Medicare is actually a great healthcare program, but ONLY if you also buy medigap insurance, which covers the 20% copayments and other stuff that medicare won't pay.
The other big expense that could potentially wipe someone out would be long-term care. Nursing homes are very expensive, and if one does not have long-term care insurance, and doesn't move their assets out of their name several years ahead of time (5 years, I believe), it is generally not possible to preserve much of one's assets if the need for long-term care arises.

Escape Brooklyn said...

I know what you mean! My sister-in-law has three kids and my husband's parents are constantly bailing them out (giving them multiple cars after their own car was repossessed, taking over their finances after the husband kept his layoff hidden for a year, paying for all the grandkid "stuff").

Meanwhile, we don't get anything because we're presumably self-reliant. (Which, thankfully, we are.) Yet we're also not taking fancy trips every month or two and ignoring our finances so our parents have no choice but to give us hand-outs. (Whine, whine!)

But your dad's retirement sounds okay. I think he's in decent shape because of the pension and social security. (Also, is his house paid off?) He's not going to be living large, but I think he's probably earned the right to splurge on some nice wine. ;)

I agree with optionedunarmed about the long-term care insurance issue, though.

Anonymous said...

that behavior (bailing out the less responsible offspring & never the responsible one) is incredibly common and typical among parents, rich or not. i have read this in finance books (including millionaire next door, can't remember which edition tho) and have seen it elsewhere.

my parents always did/do it with my brother and never me. even tho i have made tons of sacrifices and also supported myself out on my own since 18 and he stayed home till somewhere in his mid twenties, he always gets help. although not heaps, but heaps compared to the zero i have ever gotten. yeah, i know, i am whining too. it still bugs me tho.

when i was around 11 yrs old, my parents approached me saying that they planned on willing everything to my younger bro since he prob would not be able to take care of himself (no, he is not retarded or differently-abled). i protested and said we should each get 50%/50% no matter what. they were taken aback. duh...
so it started early on. i don't even want to get into the rest...

now my parents are split up (only since a few yrs ago, mom ended it), my dad remarried, so new wife will most likely outlive him (also she is a former widow, has a daughter & grandchild); my mom is for all intents & purposes 'early retired' eventho her settlement in divorce was around $200k total (he got the house, she got the $) and she is not retirement age. she prefers to act as a recluse and not have to work, renting an apt. personally i (& i am not the only one) think she is headed for real trouble in the future. she seems to think she has a lot of $ and that social security will support her. she is in denial about a lot of things. has no health coverage, no LT care insurance, no job, no business, no motivation (eventho she studied a few yrs ago and got accredited in a chosen field), etc etc and not super smart about $. her temperament is such that no one can make suggestions (give advice) to her.


Girl in the Know said...

Sounds like your sister is living on the edge....with your parents as what is keeping her from falling over. I am pretty sure that if push came to shove she'd work out her own financial issues, but I guess she'll worry about that when and if it ever happens!!!

I know all about being the "neglected" one because everyone assumes you have it made, but free money is always welcome....especially when you were looking at going over your budget in your previous post! How's that for breaking even?

You are doing a splending job stepping in to teach your niece and nephew that money does not "grow on trees" so when they step out on their own in the real world they will have some working knowledge of what it takes to survive in a world whose main focus seems to be trying to make you believe happiness=how much you can spend....regardless of how much you earn....or don't earn as it is almost the case in most situations.

I enjoy reading your blogs...