Context:
- I just found out that the student loans I’ve been saddled with for the past 19 years were completely avoidable because my parents are wealthier than they ever let on
- Something is wrong with my boomer parents—I don’t understand their relationship with money (or life in general). I think they may be seriously mentally ill
What happened
In 2014, my girlfriend and I moved into a rental home in a big city for about $1,500/month.
She later lost her job and it became unaffordable. The stress ended our relationship.
I struggled to stay in my home for the next seven years, until I finally declared bankruptcy and moved out in 2020.
I spent at least $120,000 on my rental home through those years. All down the drain. I liquidated all $30,000 of my retirement savings to try and stay afloat.
What could have been
2014 was a low point in the housing market. There were HUNDREDS of houses available in the ~$150k range, many of them nicer than the one I rented. All I needed was ~$10k for a down payment, and I could have been paying $800 for a mortgage instead of $1,500 on rent, and all of that money spent would be retained in the form of equity even if I still had to move out. It probably would have saved my relationship too (my parents complain about not having any grandkids, BTW).
What my parents say
When I mentioned this to my parents recently, they just said “we had no idea you wanted to buy a house”. NO, I JUST LOVED PAYING MONEY TO A LAND LEECH! I never even thought to ask for help with a down payment, because we were “broke”. My dad gave us grief over every dollar we spent. We never ONCE took a family vacation.
The truth
Today, my parents have $2 million in retirement savings, and no mortgage or car payments. They live in a rural area with a rock bottom cost-of-living. In 2003, they had HALF A MILLION dollars in cash, entirely separate from their retirement plans.
$2M is literally the minimum they need as a couple to retire at 65 and ALL of that money will be spent by the time they die.
They are not rich by ANY stretch of the imagination. In fact, they have just hit the bare minimum threshold to not die in cockroach ridden apartment while not being able to afford food.
Now, if your parents are 40, then you’re in luck! That means that for the next 25 years every dollar they earn is mostly discretionary (unless they have debts of course, like someone’s student loans).
If your parents are 50, maybe you’ll get a little bit of financial help.
But if your parents are 60, whelp, they can give you a few nice birthday gifts but that’s about it.
Average lifespan in the US is 78, the math isn’t mathing, 65 to 78 is $155k per year assuming average lifespan.
You’re mathing this like they’ll live to 100 which would be quite an outlier.
That’s life expectancy at birth. Life expectancy at 75 for men is ~87.
$2M divided by 13 is $155k/year. That’s gross. They pay income tax on that. So they net something less.
But consider costs go up, particular for medical care but also for comfort - aging is not easy.
Then also consider that couples that scrimp and save their whole lives actually want to enjoy their retirement, so they can spend a little money each year on vacations instead of living like Spartans.
And then of course there’s planning funerals and burials.
But then. That 78 years is also inaccurate.
The peak year of death for women is 88. The peak year of death for men is 87.
Those averages include men dying in their 40s and 50s.
So now instead of $2M being $155k/year gross, it’s actually somewhere between $100K/year and $80k/year.
But they also aren’t going to spread it out totally evenly because they aren’t going to let actuarial tables drive their life enjoyment. So they’ll commit to under spending their first year but by the time they get to the end of the year they’ll realize there’s just too much life to experience while they still have their health and they’ll have a nice vacation, not Bezos nice, but nice. Maybe a whole month in France!
Yeah, $2M is the minimum for a decent life in old age and there won’t be a penny left for inheritance.
Calling $80k the minimum to live comfortably is the most fucking upper middle class out of touch bourgeois nonsense I’ve heard in a while.
Especially considering their housing costs are near zero, and it’s among the cheapest places in the US to live.
I feel like I’m going crazy seeing someone even write it here. Like, absolutely no fucking way is that the minimum for comfort. That is flat out a luxurious highly comfortable amount to have. Some of the people here begging for money everyday on the mutualaid comm that I can’t afford to help would be happy with a quarter of that, something I would say is too low but those people would be so happy with it and call it an upgrade.
Again, you have to understand that these people are in their 70s. Saying that either they can live an impoverished lifestyle or they are living luxuriously is ludicrous and shows an ignorance about household finances.
Could they live on less? Absolutely! My grandparents did. And my parents are. And they have decent lives. But my grandmother is in constant pain and lives in a tiny apartment and cannot afford the mobility equipment she needs to get around so she wastes away in the darkness. Can people survive on that? Yes. Should they? I don’t think so.
We don’t live in a society where we have community housing and walkable cities and public services. The elderly have to fend for themselves and the only way to do that is with middle class salaries and no obligation to work. Some will work, but we are such fragile animals that an obligation to work or live in poverty and squalor is not a way to live.
Stop arguing that people should live mean hurried commodities lives and then die early or suffer for decades. Expect dignity for people as we age. It’s a shame what elders go through.
It’s been well documented for a while now that $72K/year in the US is the number at which people’s primary motivation for job hunting begins to shift from financial survival to living their life. And that was before COVID.
$80k/year is not unreasonable as a baseline expectation for a couple that worked their entire lives and wish to finally retire in peace.
Grandma should not be working retail at Macy’s or waiting tables at Denny’s.
You and me disagree and if you said this to the face of many of the people I know they would turn violent towards you very quickly for saying it.
I think you’re very VERY far out of touch. Your perspective is built on the foundation of what is “comfortable” for a liberal who has lived well for most of their lives. My perspective is growing up in squats. Your comments make me feel like this painting.
I would not wish my grandmother, after raising multiple families and working until she was 70 to have to live in a squat. If you think that’s out of touch, perhaps consider how many people in America live in squats.
Then consider that the OP and the family in question are not people who lived in squats their whole lives but rather a family who worked to establish a middle class lifestyle which means sacrificing all of their time to make profit for the owning class. When you have spent your life doing that, you do that for a specific reason - to be able to retire and enjoy a few years of your health without being ground into dust by the machine.
That is literally what people who have been working for the past 40 years and those who came before them in the liberal world-order were striving for. They are trying to avoid being homeless and living in squats. Your argument that people living in squats don’t need 80k/year is useless in this context because living in squats in the US and Europe is not considered, by the vast majority of people, to be a healthy and enjoyable life.
Poverty is not a virtue. It does not have moral standing except in that it should be eradicated through a revolutionary movement. Just because others suffer from poverty does not mean that the entirety of the Western world isn’t individually striving for a better life.
I really don’t know why you think this worthy of debate. I wish apartments cost less than 5% of my income like they did the USSR. I wish we have and 90+% home ownership rate like they do in China and Cuba. I wish there a social safety net for the elderly like there is/was in parts of Europe.
That’s not the economy we live in here in the US. In the US you need money. And living below the poverty line is in no way. shape, or form what people are striving for when they work for 50 years straight without any real time to develop themselves as people outside of as capitalist subjects.
Blah blah blah.
The question is whether these people are being selfish impoverishing their fucking child with debt while living so comfortably.
The answer is yes the fuck they are. Fuck off.
OK, so back to the topic at hand instead of trying to justify old people living in squats. You’re hard to keep track of.
The OP never asked for financial help. For me personally, I had never asked my parents for financial help and I had never received it. They also lived a life of credit cards and mortgages and saving for retirement. When I finally asked for financial help because my mental health made it difficult for me to keep working, it took months of emotional work on my end to get to the point of asking. And when I did, they gave me some money. But they didn’t volunteer it no matter how difficult my life was getting. I had to ask.
OP never asked.
My family did take some family vacations, but we also got grief about money. And my parents have less money than OP’s parents. Granted, my parents aren’t as old, and my parents are still working, so maybe in 10 years they will be as rich as OP’s.
But I would not say that my parents impoverished me, or my siblings, some of whom are worse off than I am. They didn’t ask for money either. In fact, as siblings we find ways to loan each other some money to avoid having to ask our parents for money. Which is honestly really silly, since the prior generation has more money the current one does.
But no, OP’s parents did not impoverish OP with debt. OP didn’t ask for money and chose to tough it out. I did the same thing. I also blew shit tons of money on rent. I could have avoided that if I had asked for a down payment. But also, in 2014, my parents were still working through their lifetime of debt, so it probably wouldn’t have worked out for me if I had asked.
The reality is that his parents clearly have emotional trauma around money and OP will get an inheritance if the medical system doesn’t bleed his parents dry. His parents are totally out of touch with how the next generation is living financially, but that’s a mostly universal trait for people their age - they’re out of touch about how young people live along ANY dimension.
As for being selfish for living so comfortably, again, I’ll use my personal example. One of my siblings lives hand to mouth, massive debt, no strong employment prospects except bar tending, struggles with alcoholism and depression. Another of my siblings has saved 10s of thousands of dollars, but also has no strong employment prospects except front-of-house catering service. The first sibling lives in a rundown apartment, in a poor neighborhood, no vehicle, no family around, and very little comfort. The other sibling literally lives in our parents home, with their own vehicle.
They made their choices, they are content with their choices. My parents don’t get to decide how their kids choose to engage them. They would give the poorer sibling money if the sibling asked, but no ask is made. The second sibling chose differently and lives much more comfortably.
I feel for OP, having struggled with spending my retirement money as well, and currently staring down the potential for bankruptcy myself. But my parents are not to blame and they are not selfish for living a more comfortable life than me. I have agency in this whole thing. So does OP.
They will never, ever take a vacation. My dad refuses to spend money. He lets my mom control all the finances and blow money needlessly on credit card interest, because they can’t communicate.
Well, I just found out that he’s 78 and still only has $2M in the account. So my guess is that he’s been working under financial anxiety for literally his whole life and has no chance of ever breaking free from the psychology of it.
Again, $2M is enough for a couple to retire on at 65. If you’re lucky, the medical system won’t bleed your parents dry and you’ll have a modest inheritance.
He’s never psychologically recovered from the poverty he experienced in childhood. I’m sympathetic, but I wish he hadn’t unnecessarily extended that trauma to us.
The median family of retirement age has just $200k in savings.
We all wish the trauma wasn’t passed down. The response to acknowledging that it was is grief. Anger is one of the stages. Acceptance and adaptation are the final stages.
A 10k loan (out of 500k liquidity the parents had at the time) for a down payment would have made no difference to the parents. OP stated the monthly payment would have gone from 1500 for rent to 800 for the mortgage. With no interest, that surplus of 700 a month would have paid back such a loan in under 15 months, long before the parents would have needed the money for anything.
Edit: a gift also would not have likely made a difference, but I’m using the loan as an example because we can know with 100% certainty that it would not have affected the parents’ financial security at all.
Exactly! Thank you.
They also could have purchased the home for themselves as an investment[1], and rented it out to me for the price of the mortgage. I know people with families who did just that. It would have been a win-win.
I’m not saying they should have become landlords (heaven forbid)
, but they could have sold it to another buyer when I moved out for a nice profit. Home prices have ~doubled since then. ↩︎
OP did provide context links
from five months ago. there is also information about additional assets beyond the savings
Are his parents still working?
yes
Still working at 78 and only have $2M in the retirement account means that they have never been financially secure and just achieved it around 70.
From the perspective of my generation, having tenure at 40 is financial security. That’s a guaranteed job for life with excellent benefits. Inheriting half a million dollars soon afterwards is just a cherry on top. They’ve wasted a lot of money through their financial illiteracy.