Pay Dirt is Slate’s money advice column. Have a question? Send it to Lillian, Athena, and Elizabeth here. (It’s anonymous!)
Dear Pay Dirt,
“Lucy” and I are both 34 and have been friends since middle school. She is the single mom of a teenager whose father is not in the picture and has not been interested in dating since giving birth. Lucy grew up dirt poor and suffered a lot from her parents’ bad choices, so being an intelligent person she has always been very savvy about saving and cautious about spending. As a result, she has over $6,000 in savings, despite making a very low salary as a library worker without a college degree and having no help from a partner.
In the past year or two, Lucy has discovered that many charities either do no means testing at all or only look at income, probably assuming that no one who comes to them has savings. She’s been going around to various food banks, getting her power bills paid in full, and sometimes rent assistance from other places, and using the money thus saved to buy stuff like Blu-rays and collectible figurines for herself and a Nintendo Switch for her kid.
I understand the desire to have a few “fun” things without having to dip into her savings, which she has major anxiety about. But I can’t help but find it disturbing that she is basically being given charity to buy frivolities, while some other family without any savings, who genuinely can’t afford to pay their power bill or buy groceries, are left freezing/boiling and hungry.
Lucy has shown no sign of ever considering this. I’m reluctant to bring it up. But hearing her crow about all the great stuff she got from the food bank when she has twice what I’ve ever had in the bank is getting kind of old. Should I say or do anything?
—Friend of Fraudster
Dear Friend of Fraudster,
People who struggle financially deserve to have some level of satisfaction with their lives. And that means occasionally buying items that will bring them real joy, which you may consider frivolous. Your attitude toward her spending is the kind of paternalism that says a person on food assistance should never buy anything unhealthy. It’s saying that people who do need assistance should never have anything they enjoy; that their children should never have toys, and so on. What is a frivolity to you may be incredibly meaningful to her or her child.
It’s one thing if your friend is fraudulently representing herself in order to get rental assistance, but it doesn’t sound like that’s the case (rental assistance is almost always means tested by income, and you admit that hers is low). Even when means tests are implemented, the point of these assistance programs, including food banks, is to give low-income people a decent quality of life—potentially so they can earn enough to not need them, or save enough. She likely cannot qualify for government programs like SNAP (which has an asset limit of around $2,500 with some exceptions). But I’m not sure your friend’s $6,000 is nearly enough to change her situation in any kind of permanent way.
Not everyone who needs assistance is freezing or starving. Food banks generally don’t means test for this reason. Food insecurity presents itself in more ways than just having a totally empty refrigerator, and a lot of people can’t navigate the bureaucracy means testing requires. If you’re genuinely worried that some people are starving and freezing, the single best thing you could do yourself is to fight against policies that leave low-income people vulnerable because they can’t jump through the hoops needed to qualify. Your friend is not depriving folks who seem to be struggling more than her. The programs that actively make it harder for them to get services on the basis that some small number of people might cheat the system are.
Your real gripe here seems to be that, as you put it, she has saved twice as much as you’ve ever had in the bank. But what she’s saved isn’t exactly going to carry her very far if she has a real emergency. She doesn’t have a partner to rely on financially, has no help from her child’s father, and doesn’t make very much money. I think empathy is in order, not judgment.
Dear Pay Dirt,
My grandmother died recently and left me a life-changing inheritance, nearly $2 million dollars. I knew that I would someday get this inheritance, which should have been my father’s, who died young, but never in my wildest dreams did I imagine that it would be this much money. Despite what the numbers might suggest, I did not grow up with privilege. My parents never had help with money. I have a great career now but have been living paycheck to paycheck in an expensive area for the past several years.
My only relationship with money my whole life has been anxiety. I don’t know how to feel about this money or how to share this news with friends and family around me. It seems to have made things awkward with the few people I have told. How can I be honest about what this gift does for me without making friendships uncomfortable? What do I say? And what do I keep private?
Dear Instant Millionaire,
How much you disclose or don’t is really a matter of your personal preferences, but this should not be a fact that makes your friendships uncomfortable. If you feel like you need to explain your change in circumstances, you can do it without mentioning specifics. Simply note that you feel more financially secure now and you’re grateful for it. No decent friend is going to begrudge you for not living paycheck to paycheck anymore, and if they do, understand that their behavior is about their own insecurities and not anything you’re doing.
In the meantime, you now have the money to hire a financial planner, who can help you figure out what to do with your grandmother’s gift. A financial planner can help you decide how to allocate assets in a way that doesn’t add to the trepidation you feel about your windfall. You can also now afford a therapist to talk through your anxiety around the situation. A lot of people who’ve struggled financially are naturally anxious about money because some of those experiences can be traumatizing. It’ll be good to have a professional help you learn how to settle into your new situation and deal with any negative reactions from friends and family.
Dear Pay Dirt,
I am in a loving four-year relationship. We are both in our mid-20s working in industries we like. My girlfriend makes nearly thrice what I earn which is fortunate because we live in the area where she grew up, which is astronomically expensive. My girlfriend sweetly contributes money to her working-class single mother each month that covers her rent. And between the two of our incomes, we have a reasonable amount left over to spend and save. There’s just one problem: Her mom plans on retiring next year at the ripe old age of 50 with nearly no savings and the expectation that her daughter will provide.
We’ve begun discussing how we can handle this, but the reality is that we will be sacrificing our financial futures to fund my girlfriend’s mother’s extended retirement if she follows through with her plan to shirk her highest-earning years of employment all because she’s bored with her job. This puts me in a bind: I think we should reset expectations with my girlfriend’s mother so she reconsiders her bid for an extra-long retirement. But I’m not sure what’s in my power to do considering that, officially, my money isn’t involved.
—Sunset Stalling Savings
Dear Sunset Stalling Savings,
This is really your girlfriend’s decision since she’s the one funding her mother. I might feel differently if you were both subsidizing her, but you’re not. I agree that your girlfriend’s mother probably shouldn’t be retiring at 50 simply because she’s bored with her job, but if your girlfriend is OK with it, it’s not really your call to make.
You also seem confident that your relationship is permanent and that your financial futures are intertwined. You should probably make sure your girlfriend’s on the same page about that, too. It’s great that you’ve been in a solid four-year relationship, but you’re both still very young. I think you have a few life experiences that need to happen before you two start planning for your joint retirement.
So, for now, I would tell your girlfriend how you feel about the situation and if she feels the same, ask her if there’s any way you can help her have this conversation with her mother. If she feels differently, however, you have to respect her wishes.
Dear Pay Dirt,
I have been paying half of my two grandchildren’s private school tuition ($16,148 this year) for about five years now. Grandson needs this school since he is severely dyslexic and this school has a great program to help him. I have agreed to pay half until they graduate.
My son, their father, has been trying to get divorced for over five years. My daughter-in-law filed for divorce initially but canceled mediation twice. I think if she really wanted a divorce it would already have happened because DIL gets what she wants. Everyone else is just supposed to be OK with her decisions.
Right now, my son is paying half of all the kids’ expenses, and she pays the other half. This includes clothes, school supplies, sports leagues, vacations, etc. DIL makes two to three times as much money as my son. She has always overspent on everything, as she has luxurious taste. My son makes $75,000 a year. They live in an expensive city. If I did not help my son, he would be in over his head in debt. My income is about $42,000 a year. I am mostly using savings to pay the tuition. I paid off my son’s credit card, $8,000 in May. It is now back up to the max, $8,000 again in August. DIL decides what to spend on the kids and bills my son for half. He gets no input on what to buy or any advance notice of kids’ expenses, just a bill at the end of the month.
I don’t mind helping my son, but I feel like I am only helping her overspend. There is no reconciliation in the future, only divorce. He justifies giving her half of the kids’ extras by saying they are half his. He is such a good father, but I feel this financial arrangement is keeping him miserable and broke. I am thinking of telling him I am not going to give him any more money until he has his lawyer draw up a separation agreement with a financial limit on how much money he must pay DIL every month. I will pay his lawyer’s fees. I am not made of money, and I want my son divorced and only paying a fair share of his kids’ expenses. How do I help this happen?
—DIL’s Mantra: I Hate you, Don’t Leave Me!
Dear DIL’s Mantra,
Your son has to take the initiative and hire a lawyer, or this will keep happening. The mediation option is obviously not working, and there should be more equity in deciding how expenses are allocated.
That said, this is really your son’s decision, and if your DIL is making more money than he is and buying expensive items with her money, I’m afraid you don’t have much say in that because, well, it’s her money. Of course, your son has every right to bring up to her the challenges he’s facing because of these purchases. You could stop paying half of your grandchildren’s tuition and maybe that would cause your DIL to spend less, but given the numbers you’re talking about, I doubt that would really make a difference.
You should also consider that your son may want to foot half the expenses for reasons other than duty. It may make him feel like he has an equal stake in decision-making for your grandchildren, and that he is on equal footing with your daughter-in-law. However, since you are subsidizing some of his expenses, you should talk to your son about the burden this is putting on you. It’s one thing if you made a promise to help your grandchildren with their education, but paying off your adult son’s credit cards is above and beyond the call of duty. You should tell him that you cannot do it indefinitely and give him a deadline for finding a lawyer and getting the separation agreement done. If he blows your deadline, it’s his problem to solve and not yours. He may have to learn the hard way that relying on you is not a permanent solution.
More Advice From Slate
My husband and I send our boys to a pretty expensive summer camp. It’s a great camp! To me, it’s worth every penny, and we have been lucky to be able to afford it (more on that in a sec). At the end of every summer, the camp sends out an email with tipping guidelines—suggestions for how much you should tip your counselors and swim instructors and other camp staffers. We’ve always followed these guidelines, but this year we find ourselves in a tough financial spot (a much worse one than we were in when we originally enrolled the boys in this camp). So I’m wondering: Would we be horrible people if we just didn’t tip?