We were hosting a birthday party for our grandson’s 6th birthday. It was a wonderful day all around…..until later that afternoon, when the party was winding down. I’d come out on the patio with a pitcher of adult beverages, when I overheard my daughter-in-law discussing our house, and the overall property, with one of the other mothers. The other guest remarked about how beautiful it was, and my DIL responded, “Yes it is beautiful. What you’re looking at is my retirement plan. They better keep this place maintained while they’re alive, because (insert my son’s name) will inherit it, and then I get to live here. They’re loaded, because this is their second home, with their primary residence a couple of states away. Yeah, I’ll be set up nicely.” WHAT THE HECK!!! I just about dropped the glass pitcher! Somehow, I was able to compose myself in just a few seconds. I cleared my throat quite loudly, and asked if the ladies would like another cocktail. My DIL turned around with an absolute shocked expression, the color draining from her face. I continued filling glasses, offering food, and packaging B-day cake for the parents and children leaving. Party ended, did a bit of cleanup, packed gifts in our son’s car; husband and I gave hugs & kisses before they left. DIL took me aside for a “special hug” away from the others, and said she knew I’d heard a part of the conversation. She apologized for her behavior, explaining, “You know I was only kidding, don’t you?” I told her that it was not perceived as “kidding”, and was very hurtful, as we’d always treated her with loving kindness and respect from the moment our son first introduced her to us. I would be discussing this with my husband and son, because we also have another son to consider. After they left, I laid it out to my husband. Yeah, he about went ballistic. Our son was shocked and saddened, and later discovered that his wife had been slowly draining her own 401K plan, anticipating a later windfall from us. Sooooo……….the Will is changed; the Trust is changed; DIL cannot get her hands on anything without going through at least 2 people in agreement (that is, as long as they’re married). Get this - We’re 68, and haven’t even retired yet. My husband is very well compensated, as part of the ‘brain trust’ of the company he works for. I’ve been pleading with him to retire to enjoy the life we’ve built together, but he thinks his brain will go to mush. I now have a strained relationship with my DIL. She has suggested that I attend counseling sessions with her when I’m in town in order to rebuild our relationship. My head is going to explode…..I want an apology (no, not the non-apology “I’m sorry if you feel hurt”), along with acknowledging the broken trust, and how she intends to turn this around is what I need. Not looking forward to Christmas Eve dinner.
Great points, especially #4. After reading “Die with Zero”, I do think helping people (family and charities) while you’re alive is rewarding, but if you have children who aren’t responsible or don’t handle money well, that can cause so much additional stress.
I am living proof of your 1st example. We have a net worth north of $4 million, with around $3.5 million invested. We have both been savers on medium incomes, hence the net worth. Our annual "needs" are less than $50k, and we are spending around $120k due to extensive travel. At age 63, we still have a lot of good years ahead of us. I need a new truck. My HD diesel truck is 22 years old and has been breaking down on us and keeping us from going on camping trips. A new HD will cost us about $70k to get a Lariat, but I have a real mental problem with spending that much. Spending $100k on a truck won't impact our retirement even a little bit. I know that. I understand that, but a lifetime as a saver makes it hard to become a spender. We both retired at 58. We had the money, and we were ready to leave the workforce. We own land, take multiple vacations, and do what we want. We keep 3 years in cash to avoid selling down markets. We try not to support our grown children too much. We kept a house and rented it to our kids, so it actually did give us a cash return. We sold that house last month. We did give each of the 4 children a decent check after the sale. I know people who have pulled from their 401k to pay for their kid's college. They are still working at 70.
Many of us grew up with parents who lived through the Depression and WWII. That’s why we’re very conservative with spending and we never want to be a financial burden to our children. It may not be perfectly logical, but that’s our thinking.
Might as well keep working. My wife is 60 and chronically ill with life expectancy of 5 more years. Too sick to travel more than car trips as it is exhausting. I can't travel distantly alone bc she has a penchant for getting sick or hurt whenever I an inaccessible. We have a daughter of limited ability, will NEVER be a high earner and is not attractive enough to land a good man, so I will need to leave enough to see her through the rest of her life. Retirement means sitting around doing hobbies as I can't/won't go socialize while my wife stays home alone. I work from home so we get together time everyday. I may have enough to last me a lifetime just on interest alone, but what can I spend it on right now? This Conole advice is good for people who don't have those who are dependent upon you and is a generalization. But I am sure I am not alone, that specifics dictate the course.
I am also wondering if there are differences in the tax treatment of distributions from a 401 (a), 457, IRA, and SEP. Could you explain this or point me to prior video that discusses?
Please i have my retirement funds and small money that am planning of investing with but don't want to make a wrong investment and loose all i have labored for,
We were hosting a birthday party for our grandson’s 6th birthday. It was a wonderful day all around…..until later that afternoon, when the party was winding down. I’d come out on the patio with a pitcher of adult beverages, when I overheard my daughter-in-law discussing our house, and the overall property, with one of the other mothers. The other guest remarked about how beautiful it was, and my DIL responded, “Yes it is beautiful. What you’re looking at is my retirement plan. They better keep this place maintained while they’re alive, because (insert my son’s name) will inherit it, and then I get to live here. They’re loaded, because this is their second home, with their primary residence a couple of states away. Yeah, I’ll be set up nicely.” WHAT THE HECK!!! I just about dropped the glass pitcher! Somehow, I was able to compose myself in just a few seconds. I cleared my throat quite loudly, and asked if the ladies would like another cocktail. My DIL turned around with an absolute shocked expression, the color draining from her face. I continued filling glasses, offering food, and packaging B-day cake for the parents and children leaving.
Party ended, did a bit of cleanup, packed gifts in our son’s car; husband and I gave hugs & kisses before they left. DIL took me aside for a “special hug” away from the others, and said she knew I’d heard a part of the conversation. She apologized for her behavior, explaining, “You know I was only kidding, don’t you?” I told her that it was not perceived as “kidding”, and was very hurtful, as we’d always treated her with loving kindness and respect from the moment our son first introduced her to us. I would be discussing this with my husband and son, because we also have another son to consider.
After they left, I laid it out to my husband. Yeah, he about went ballistic. Our son was shocked and saddened, and later discovered that his wife had been slowly draining her own 401K plan, anticipating a later windfall from us. Sooooo……….the Will is changed; the Trust is changed; DIL cannot get her hands on anything without going through at least 2 people in agreement (that is, as long as they’re married). Get this - We’re 68, and haven’t even retired yet. My husband is very well compensated, as part of the ‘brain trust’ of the company he works for. I’ve been pleading with him to retire to enjoy the life we’ve built together, but he thinks his brain will go to mush. I now have a strained relationship with my DIL. She has suggested that I attend counseling sessions with her when I’m in town in order to rebuild our relationship. My head is going to explode…..I want an apology (no, not the non-apology “I’m sorry if you feel hurt”), along with acknowledging the broken trust, and how she intends to turn this around is what I need. Not looking forward to Christmas Eve dinner.
Great points, especially #4. After reading “Die with Zero”, I do think helping people (family and charities) while you’re alive is rewarding, but if you have children who aren’t responsible or don’t handle money well, that can cause so much additional stress.
I am living proof of your 1st example.
We have a net worth north of $4 million, with around $3.5 million invested. We have both been savers on medium incomes, hence the net worth. Our annual "needs" are less than $50k, and we are spending around $120k due to extensive travel. At age 63, we still have a lot of good years ahead of us.
I need a new truck. My HD diesel truck is 22 years old and has been breaking down on us and keeping us from going on camping trips. A new HD will cost us about $70k to get a Lariat, but I have a real mental problem with spending that much. Spending $100k on a truck won't impact our retirement even a little bit. I know that. I understand that, but a lifetime as a saver makes it hard to become a spender.
We both retired at 58. We had the money, and we were ready to leave the workforce. We own land, take multiple vacations, and do what we want.
We keep 3 years in cash to avoid selling down markets.
We try not to support our grown children too much. We kept a house and rented it to our kids, so it actually did give us a cash return. We sold that house last month. We did give each of the 4 children a decent check after the sale. I know people who have pulled from their 401k to pay for their kid's college. They are still working at 70.
Many of us grew up with parents who lived through the Depression and WWII. That’s why we’re very conservative with spending and we never want to be a financial burden to our children. It may not be perfectly logical, but that’s our thinking.
I've watched quite a bit of your content James and this video is uniquely right on point. Well done.
Might as well keep working. My wife is 60 and chronically ill with life expectancy of 5 more years. Too sick to travel more than car trips as it is exhausting. I can't travel distantly alone bc she has a penchant for getting sick or hurt whenever I an inaccessible. We have a daughter of limited ability, will NEVER be a high earner and is not attractive enough to land a good man, so I will need to leave enough to see her through the rest of her life. Retirement means sitting around doing hobbies as I can't/won't go socialize while my wife stays home alone. I work from home so we get together time everyday. I may have enough to last me a lifetime just on interest alone, but what can I spend it on right now? This Conole advice is good for people who don't have those who are dependent upon you and is a generalization. But I am sure I am not alone, that specifics dictate the course.
James...Where did you get that shirt? I want to buy it for my husband! Great video, BTW! 🙂
Great points and excellent show notes!! 👍
You should do video on gifting to responsible adult children. I am sure there are many conflicted parents.
Hi James, Do you have any videos on US retiree becoming tax resident in Spain & the tax impact on the portfolio? Thanks
Then how what should the asset allocation be
Sooo guilty of #4. Lol but I do have a sober mind about it. All others I'm good and understand! You are awesome!😊
I am also wondering if there are differences in the tax treatment of distributions from a 401 (a), 457, IRA, and SEP. Could you explain this or point me to prior video that discusses?
Please i have my retirement funds and small money that am planning of investing with but don't want to make a wrong investment and loose all i have labored for,