Pay Dirt is Slate’s money advice column. Have a question? Send it to Athena and Elizabeth here. (It’s anonymous!)
Dear Pay Dirt,
My mother-in-law recently approached me with a concern that for the first time since they retired (18 years ago), she and her husband have more money going out than coming in. She didn’t share exact amounts and I didn’t ask—I couldn’t tell if she wanted advice or just to unburden.
I shared this conversation with my husband and he was immediately alarmed. We’ve noticed a huge influx of Amazon deliveries over the past two years but attributed that to them being cautious about going out during the pandemic because they’re both immunocompromised. On the heels of this, a brand-new car appeared in their driveway “because it’s FIL’s dream car,” despite him no longer driving due to declining vision. The payments are huge, over $1K/month.
After a conversation with husband and MIL (father-in-law does not and never has participated in the financial angle of his and MIL’s life together), we determined that the Amazon stuff isn’t essentials but mainly impulse purchases of FIL, things he can’t use and doesn’t need: tool benches, air compressors, car jacks, an above-ground pool “for when the grandkids visit” (one week a year, in the spring before it’s warm enough for swimming, and their lawn isn’t graded to have a pool safely put up); the list goes on.
None of us are financial experts, but we’re not idiots either, so looking at what their retirement income is, we can see that they have approximately three years of this spending before they’re bled dry. We attempted to share this with FIL but he’s quite determined that he spent his best years earning it and will enjoy his retirement however he wants. Husband and I are incredibly concerned about this trajectory and would really like to know if/how we can help right this sinking ship.
—He Doesn’t Want The Help
Dear Doesn’t Want the Help,
I think you have to have a different kind of conversation with your FIL. Acknowledge that he worked hard for his money and should be able to enjoy it, and that you don’t want him to forego that. But “his” money is not just his money. It also presumably supports your MIL, and is what you will have to work with, if or when they need medical assistance later in life. And if he spends it all, someone else will have to pay for that—likely, his children.
For everyone’s peace of mind, you should sit down with a financial planner and project out what their real expenses are and what you all anticipate for the future. Since your MIL handles the finances, she should lead the charge here. What the financial planner will invariably tell them is that they don’t have to penny-pinch, but they do have to budget. Part of that budget can be money that your FIL can spend however he wants, on whatever he wants, but the cap will prevent him from doing material damage to his overall savings and putting the rest of the family at financial risk. A good financial planner will also recommend monitoring spending, and as part of that, your MIL should make a point of updating your FIL, maybe once a month or so, about the total amounts, and where the money is going. If finances are regularly left to your MIL, part of the problem may also be that it allows your FIL to view how much money he’s spending as an abstraction. He may not realize how much is going out the door. A gentle reminder about balances might be a reality check for him.
When you bring this up, don’t make your FIL the entire center of the conversation, or he’ll just feel like he’s being attacked and get defensive. Frame it as a desire for overall financial planning and a need to allay everyone else’s anxieties—and to have a longer-term plan in place. Make sure he is in any meeting you schedule with a financial planner, because it also helps to hear from a neutral third party regarding what is and isn’t appropriate spending. Even if your FIL is having a good time on his spending spree, I’m sure he does not want to be in a position a few years from now where he can’t enjoy anything, because he’s stressed out financially, and can’t just work to make the money back.
Dear Pay Dirt,
My husband and I bought a small cottage for rental retirement income. The mother of our grandkids—our sons’ ex—got involved with a man with PTSD and a history of abusing drugs. Things got bad and she moved into our rental, which we let her do for the kids’ sake. She said she was “finished for good with him,” but shortly after moving in she started having him stay there secretly. She knows we would have never let her move in if he was still in the picture. Police have been called there several times already.
We gave her a decent discount on rent. We are breaking even with expenses from rent. She has been very difficult to deal with. Rent is often late, it’s a hassle to get the utilities paid every month—lots of guilt trips and excuses. If I remind her gently to cut the high grass (which she agreed to do, it’s a very small yard), she will have a meltdown and gaslight me by saying I’m stressing her out. She is trying to get housing assistance (behind our back), which would be a major headache for us. I have no desire to aid and assist her hidden boyfriend, but don’t want to harm the kids! She would 100% blame us if we asked her to move.
The lease is up soon. I’m desperate to find a solution to this problem.
–Going to Be the Bad Guy, No Matter What Happens
Dear Going to Be the Bad Guy,
It sounds as if you’re treating your son’s ex as a pretty regular tenant, except for the discount on rent. In fact, you expect a few things from her that are not always in rental agreements—she takes care of the lawn, pays the utilities directly, etc. There’s nothing wrong with this, but you seem to believe that the rental discount gives you a right to tell her who she should date. If she were a regular tenant—one who wasn’t related to you—these things would be none of your business.
I think you have to determine what role you want to play in her life. You seem very judgmental about the situation with the boyfriend, and if, as you state, your real concern is for the kids, you should maybe be a little more concerned about their mother’s welfare as well. If the police are being called to the house, what is happening there? A lot of people who have no experience of domestic violence don’t understand why people who are abused—women, especially—don’t just leave, and this is a wild misunderstanding of how and why domestic violence happens. Sometimes people can’t extract themselves from the relationships, sometimes they have complicated feelings about the people who abuse them and hope that they’ll change, and so on.
If you’re getting involved from a place of concern, you should also ask why she’s paying rent late, and not in a way that implies that she’s just being irresponsible, ostensibly out of disrespect for you—which seems to be what you believe, and is probably not the case. In my experience, no one wants to pay rent late. If she’s struggling financially, it would help to know how and why. And you cannot be concerned for the kids without being concerned for their mother. Their welfare is completely intertwined.
If, on the other hand, you are not that concerned and do not actually want to get involved, your solution is pretty simple. She’s paying rent late, and if it happens again, you are within your rights to evict her—though you do have to give her a warning. In order to figure out what to do, you need to decide who she is to you.
Dear Pay Dirt,
My wife’s only brother “Mark” is on the autism spectrum and lives at home with her aging parents. Mark has attended college on and off for more than a decade and has never had a paying job. My in-laws cover all of his expenses.
Recently, my wife raised the issue of planning for Mark’s needs at the point when my in-laws are no longer able to do so. After some research, she suggested that a special-needs trust might be appropriate, both to protect assets and to ensure Mark’s eligibility for government programs (which he is currently not using).
My wife’s parents shut down the conversation. They insist that Mark will soon be able to earn enough money to support himself and live independently. While we would be thrilled if Mark left the nest, this does not seem like a realistic or probable outcome under the circumstances. There is currently no concrete plan for him to get a job or move out, and my in-laws manage his day-to-day needs like doctor’s appointments, groceries, and driving.
My wife and I are concerned that we will be left with a difficult situation when my in-laws pass away if Mark inherits a large sum of money without any restrictions. We are comfortably middle-class, but we have three teenagers. We cannot afford to provide for Mark at the level that my in-laws do at the present. And while my in-laws are wealthier than we are, I cannot imagine that they have the resources to pay Mark’s expenses for the rest of his life (they have commented that they cannot afford to pay for an apartment for him, which is why he still lives at home). They do not believe in “government handouts,” and refuse to help Mark qualify for aid programs. Is there anything we can do to protect ourselves and Mark?
—Not Responsible Now—But We Will Be
Dear Not Responsible Now,
Your in-laws are letting their egos make decisions for Mark. They do not want to be perceived as taking government handouts (which assistance programs are not—they’re programs your in-laws have already paid into via their taxes, just like Social Security, and I’m sure they’re not sending their Social Security checks back), and they seem to be in denial that Mark’s situation is probably going to stay the same, here on out. None of this is good for Mark, or you.
You need to reframe the conversation with your in-laws. Special Needs Trusts are designed to protect the beneficiary, and there are plenty of options that allow Mark to work if he is capable of it. (You may also want to see if he is eligible for an ABLE account, which is a tax-advantaged savings account designed specifically for people with disabilities.) These things are designed to facilitate independence, not prevent it.
If your in-laws just hate the government, and this is an ideological issue, you may want to point out the tax advantages for them, and also the fact that they’ve already paid into these assistance programs. So they’re not “taking government money,” per se. They’re essentially getting back what they invested via income taxes, and through programs that are explicitly designed to help people like Mark who may not be capable of taking care of their own primary needs.
They also need to examine the possibility that if, after they’re gone, their hopes for Mark simply don’t materialize, or something happens to you (who will be his safety net), that would put Mark in a worse position. Special Needs Trusts are designed to prevent people like Mark from being exploited by people who would take advantage of him, which is a definite risk if he’s forced to manage his own finances and isn’t capable of doing so.
Lastly, you should bring Mark into the conversation, and address him directly. He’s an adult, and if he’s been able to attend college, it sounds like he’s probably capable of participating in planning for his own care. It may be the case that the person best in a position to convince your wife’s parents that he needs these things is Mark himself. And unless he’s in some sort of conservatorship arrangement with them, he can set some of these things up, with your help.
Dear Pay Dirt,
I’m in a bit of a financial pickle and I don’t know what to do about it. At the beginning of the pandemic, I moved in with my mom because I lost my job, and my new job didn’t pay as much. It was really one of the best things that could happen, because she owed me some money, but couldn’t pay me enough to offset my rent. So now, I move in with her and am saving a ton on rent. I live in a city where renting is more expensive than owning but because of my financial situation, I could never afford a house.
Now, I’m so close to a down-payment amount that will allow me to buy a house. I have my budget scheduled meticulously and have about four to six months before I’ve saved enough for the down payment. About four months ago, when I was about a month away from having my deposit saved up, I was diagnosed with a chronic illness that requires some expensive lifestyle changes, such as a much healthier diet and a lot of high-quality vitamins. This was a financial blow at the time, as I had to dip into my savings to pay for my new doctors and treatments, but I made a new budget and have been sticking to it. It’s been really hard since the new diet in and of itself is like having a second job, but I’ve been able to stay on track.
Until recently. When I first made my diet change, the food I was making looked pretty terrible. I was used to eating mostly frozen meals or just making pasta with canned tomato sauce. It took a while to get used to the new cooking, but I’ve figured out how to make really good food. In the beginning, my mom didn’t want anything to do with the food I was making. Before I went on the new diet, we’d often share meals and she very regularly bought takeout for the both of us. But now that the food is looking so good, she keeps eating it.
I’ve tried to tell her that the ingredients I use are incredibly expensive and I no longer have the ability to share my food, but she just keeps bringing up how much she’s given to me and how ungrateful I am. Then, I realized at some point that she was taking some of my vitamins. When I confronted her, she said that she’d heard these vitamins were good to take during the winter months.
I basically can’t save anything because she’s eating through my savings! I’m basically working two jobs trying to figure out this diet and I am just exhausted. I just can’t get her to understand that it’s not about the money, it’s about the time I’m putting into cooking as well. When she eats the food I have plans to use later as leftovers, I’m forced to go to the one restaurant in town that I can eat at and spend a huge amount of money on one of the two dishes I can eat from there. At this rate, I am never going to be able to save up enough money for a down payment. I live in a city where renting is more expensive than a mortgage and being able to buy a house was the only way I was going to be able to move out. Do you have any advice?
–Stop Eating That!
Dear Stop Eating That,
As someone who’s lived with roommates who’ve eaten my food without asking, I sympathize with your frustration. However, I do not buy that your only two options are continuing to live with your mom or buying an entire house. There are roughly 2,736 options in between that would absolutely allow you to stop playing involuntary personal chef to your mom, and also not require that you make a giant down payment on an illiquid asset that is a long-term commitment.
With regard to the immediate issue: Your mom should certainly respect your boundaries, but understand that her logic may be that you’re not paying rent and that this is a way of paying into the overall expenses of the household. You could also ask her to chip in for the food, or you can make portions just large enough for yourself, and I guess, hide the pricey vitamins.
But that’s not my real concern. If your finances are so tight that your mom eating your food is preventing you from moving out, you are in no position to buy a house. You need a financial cushion, especially if you have health issues, because the down payment and mortgage are not your only expenses, and some of them are going to be variable. You’ll also have to pay for maintenance of the house, property taxes, and lots of things you haven’t had to deal with as a renter. If you can only afford the down payment by the skin of your teeth, any one of these things could throw you into default with your mortgage. So let’s look at other options:
First, if you insist on buying, there are surely smaller spaces—apartments, studios, etc.—that cost less and require a smaller down payment than a whole house. From your letter, I gather that you don’t have kids or a spouse, so how much space do you need, a minimum? That should be your starting point.
But if your goal is really to buy a house because, well, you want a house, then you should look at other ways to be independent that allow you to save. I live in New York City, where a formative experience for people in their 20s who don’t have trust funds is to live with five roommates in a crappy Bushwick loft, where the shower is in the kitchen and no one is sure who the landlord is. You don’t have to go that far, but you could probably find an affordable place to rent with a roommate who actually respects your boundaries and will not eat your food. Even better, you could find a roommate with similar dietary needs, buy in bulk, and split the cost—and the cooking labor—of your expensive diet.
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