We’re still trying to figure out what that number we need to have is. We have already retired, but still can’t figure out how much is enough in investments before we start passing money on to our kids. We’re thinking that when we figure out that number, we might make an analysis at the end of every year, figure out our net worth (not including assets like real estate or vehicles), and as long as we don’t have any debt, to have a plan to spend the excess (a combination of passing money to the kids, future large projects or trips, and charitable contributions). We’ve been to financial advisors, and we’ve not been crazy about their suggestions, so I think we’re going to have to figure this out on our own.
But it won’t happen this year, since we have debt!
This is sort of where we are, although we did already buy our kids a house and a new car each, and we set up accounts (not very large yet) that will go to each of our GDs. We’ve offered to pay private school tuition K - 12 when the time comes. A donor advised fund was also set up a couple of years ago for charitable contributions.
We need to work out how we each view potential health care expenses, at least in the worst case. Both of us say we’ll opt out (legally or otherwise) if faced with minimal quality of life rather than spend a decade (and every last cent) in skilled nursing care without hope of improvement. We just hope that choice faces us later rather than sooner.
H hasn’t quite gotten comfortable with spending our retirement savings even though our net worth has increased each year since he retired. The pandemic reduced our spending even more. I’m ready for some splurges, at least small ones.
Wow, you are way ahead of the vast majority of people in regard to gifts, I would imagine. I’m sure my kids would love us to buy them a house and car, but since they live in SF and NYC, that’s a long ways off! I do wonder if that is the more traditional way to gift, to give kids money towards specific needs, and to start accounts for grandkids. You guys have obviously done a great job saving and investing your money.
In our case, we have no grandkids, and I don’t know if that will ever happen, much to my dismay. Our youngest said that if he had kids that he’d want them to go where he went to middle/high school……the tuition has increased to 42K this year, so I say to my fictitious grandkids, good luck with that!
We, and one of our kids, live in a LCOL area. At least it was until house prices skyrocketed a few years ago, but even that is relative. You can still buy a 1.5K - 2K sq ft SFH that’s about 10 - 20 years old for under $300K. New houses that are 2K - 4K sq ft typically range from $550K - $875K; of course, some are higher. Houses are costlier in the other kid’s area, but no where near SF and NYC levels.
The one respected secular private school in our area runs about $25k/yr plus extras, or double the cost of the parochial schools that our GDs’ parents favor. Our kids chose to go to state universities and earned academic scholarships, so that cost us very little. I think our GDs will be encouraged to do the same.
As for saving and investing, yes we were careful and very frugal especially after we were nearly wiped out in 2008 between the market decline, compensation in the form of stock and options instead of salary, and extreme medical expenses. Despite bad luck for a couple of years, on the whole we’ve been very lucky and we don’t discount that.
We have done more than most parents (as have many on this thread) for their children and grandchildren.
We are still in ‘baby steps’ with estate planning. We have a net worth which we update monthly.
DH and I are 67 but our DDs are 27 and 29. 4 Gkids are 6 month - 5 1/2 years. Neither DD own a home, but it seems DD1/SIL may be in their area long-term, and once DD2’s BF is in her area, they will be in their area long-term.
We have pulled some money out of our home and have 2.5% interest - planning to do some home renovations (cosmetic), but over time, it may be some help with home purchasing/down payment funds.
We are in low tax years, and doing some 401k to Roth IRA conversions slowly to spread out when required minimum distributions happen for us.
DDs will have inheritances, especially if DD1 (a nurse) helps us some when we get to be seniors needing care. I plan to be closer to her family to help some during the school year, once the kids get to where they need the extra person for kid activities/music lessons/sports.
DD2 lives near Disney World, and visits there right now are often including vacation type activities.
Our kids will equally get whatever is left when the last of us parent dies. No contingency on them helping us. We feel that this is something we need to plan for and not our kids.
We do everything fairly between DDs. So if towards the end DD1 helps us, she will be compensated for it. Level playing field. DD2 says she will ship us over to DD1 (says with humor) but difference in personalities and professions (DD2 is an engineer like her dad).
The tough thing about compensating a kid who helps more in the end is that you may not be in a condition to arrange that.
Based on observation with friends, I do wish that more sibs who did none of the hard work but got an even split would find a way to do something to thank the worker bee sib. (Same idea for their kids if the money went to the grandkids). Offering a nice vacation or other perk would a nice gesture.
One of H’s siblings took on care of their parents. We lived a full day’s drive away and H’s work schedule meant that he couldn’t visit more than a few times a year. While in the end there wasn’t much left, it was still important to FiL to divide everything equally. H was an executor (along with another sib who left everything up to him), and once all of the paperwork was settled he gave his share to the sibling who’d been the caretaker. We also gave a similar amount from our own funds to this sibling when that family was twice hit by heavy medical expenses. The only thing H asked of his sibling is that nothing be said to the rest of the family.
Your husband is a very good man. It’s wonderful when the person who has done so much work is appreciated by the other siblings. I do understand why parents would feel the need to be equal, whatever the situation, but what a great relationship that the siblings can work it out after the fact.
I am not home now to look up the details on our LTC policy, but after the 10 year guaranteed rate, they offered options to keep premiums locked in. We gave up some of what our policy offered to keep payments low, but honestly, what it offers and what it pays is fine. Takes the edge off of care one might end up needing if policy conditions get met.
We had a policy with one of the largest companies in LTC insurance, but they totally got out of it and then got into physician malpractice insurance. Of course they still maintain the insurance policies that have been sold and continue to have premiums paid on them.
We did the same. Ended up giving up some of the maximum coverage and took the 1% COL inflation option instead of the 3% , lowered the premium and will get a onetime refund check for $6k. So they pay 6k but take away several (many) thousands in potential coverage.
Yes, we want to not have to use the LTC insurance policy because our health is good enough until we expire. And yes, then we would self insure beyond what the policy would cover if we met the policy enactment requirements.
One sad part of the situation was that H had to insist that none of the others could know. Some of the siblings get along very well, but others not so much. Childhood jealousies continue to play out even when everyone is over 50.
