In Life, Money

How money became a problem in my family

I don’t even know where to begin, because there are a lot of facets to this that can be hard to understand if you don’t know the whole picture.

THE BACKGROUND

My family won a small lottery a long time ago and with this money, they had a fancy dinner, went on a family vacation, bought a house and a car.

30 years later, the money is still $500,000.

ReadMy parents won the lottery and then wasted most of it on themselves

Reasons why:

  • Father is addicted to gambling — casinos, lottery tickets, horse racing
  • Father has no idea about money management and personal finance
  • Mother is an Ostrich who is scared of bills, numbers and money
  • Father thinks he’s smart and can beat the stock market with investments
  • Neither parent knows how to save on the big stuff, they’re penny-pinching but pound-foolish

My family has some ideas about my money such as:

  • Children should buy their parents new cars every time they need one
  • Children should pay for luxury vacations for their parents
  • Children are investments who are meant to return that $250K they ate from Age 0-19
  • Children should buy their parents whatever they want, and pay for everything

ReadFilial Piety 101: When does the giving back to your parents start?

stock_canada-bills-money-cash-20-2

All of the above would be (questionably) fine, if the parents had also:

  • Worked hard their entire lives, full-time, non-stop, sometimes working 2-3 jobs to do it
  • Saved enough money for themselves to not have to worry about their own retirement
  • Paid or at least tried to save money above their budgeted expenses to pay for kid’s education

ReadWhy my parents can’t continue living their expensive lifestyle

In contrast, my parents did the entire opposite of the above:

  • Worked part-time for their entire lives, or not at all
  • Saved $10,000 for their retirement, except for the house that they currently own in full
  • Didn’t pay a dime for their kids, and we all left around 19 to live on our own full-time
  • We all took out student loans (no co-signing because their credit was just AWFUL); 100% paid now

Read: What my father learned growing up about money and what my mother learned about money

Even if my parents had no money for me when I was going to school, because they were working so hard just to stay afloat above their basic needs and expenses, I WOULD BE HAPPY to give them money each month.

I don’t, aside from rent and buying and cooking all the groceries, because:


  • They aren’t destitute and don’t need the money to live
  • They lived about 30 years not doing much — part time, 15 hours a week, or 0 a week
  • They aren’t sick and they have one of the best health plans in Canada
  • They have the means and the potential to bank $30,000 a year (they choose $0 – $12,000)
  • They continually waste a good 25% of their income on lottery tickets, gambling and casinos

Read: My parents think the lottery is their retirement plan.

Say what you will about people who are addicted to lotteries and gambling, being akin to folks who are addicted to crack cocaine, but I am still extremely annoyed at this wasteful behaviour.

It’s one thing to spend a lot of money on food, a vacation, or ANYTHING that benefits your life directly, even shopping.

It’s entirely another to waste it on a dream where you don’t even have a sliver of a real percentage to win those millions.

Frankly, it’s kind of a blessing in disguise because gambling disgusts me, and hurts my brain.

I don’t abstain completely from gambling, but the most I’ve ever spent is $20, and I lost it all. It was a good lesson in losing money you don’t necessarily need to lose if you aren’t a dumbass about it.

I went the other direction financially, learning about how to REALLY manage my money, deciding to save, invest my money in index funds, dividends and build a future that I am able to control by myself instead of relying on a lottery.

emergency-fund-cash-money-bills-USD

A FEW YEARS AGO…

I caught wind of some shady money-switching tactics that basically meant my mom was the scapegoat paying for expenses that didn’t exist for my sibling and my father.

My mom was giving almost her entire paycheque ($4000) to my dad, because he told her that it was how much it cost to run the household.

When I questioned him on his numbers, these are his ridiculous answers why it cost $4000:

  • $1000 for Gas each month — What, are we swimming in this stuff?
  • $1500 for Mortgage — Bare minimum
  • $1000 for Food — Are you KIDDING ME?
  • $1000 — Utilities, including internet, telephone, cable TV and cellphones

When I pressed him for actual numbers, averages and details, he realized he was caught in a trap when he started giving me actual numbers for each of the utilities, and it added up to about $300 a month.

I realized that the budget was really more $2500 a month at the end of it all, but my sibling and my father were in cahoots with each other, milking the cash cow (my mother), to the tune of $1500 a month, for about 7 years.

I hit the roof.

I flipped out, instituted a budget, shook my mom (mentally) and told her to wake up because this would not end well if there was a blip in the employment radar.

She listened to me, decided I was right from the facts I laid out to her (all the twisted, scammy practices I saw within my family), and cut the amount she gave to my dad to pay for the bills and mortgage down to $2500 a month.

That budget is still very generous.

With the extra $1500 a month, she used it to clear the mortgage in less than a year and became debt-free.

canada-money-cash-bills-2

THE CURRENT SITUATION

After I slashed the budget down $1500 in 2012, my father grew increasingly angry/depressed/sad/whatever. I ignored him completely in this regard (and rightly so), because he was a scam artist in my eyes, which is made even worse as my mother is the total opposite, and didn’t deserve that treatment.

Now that they’re debt-free, everything should be fine.

My mom makes more than enough, has no plans on retiring any time soon and by my estimates, they could easily save about $35,000 a year net. Maybe $30,000 if we include vacations and other fun things.

In reality, they save less but I am still not worried because with her pension plans, they will be fine in retirement if they only have $2500 a month to live on, especially now that the house is paid.

I only worry because I know that going from a HUGE income down to a third of it is not an easy drop (not for ANYONE).

It’s like eating normally and having a great life, then having to live off beans, conserve toilet paper, and take cold showers.

ReadWhy my parents can’t continue living their expensive lifestyle

THE FUTURE

As you may or may not know, we paid $600/month in rent to my parents in 2012 and 2013 because we’re in transition, and don’t want to take a 12-month lease until we know where we are going to be.

stock-photo-money-cash-wallet-pay-shopping

We could have definitely left and stayed in a hotel for double the price, but:

A) That’s a waste of money to sit around and do nothing

B) We actually ENJOY being with my mom, and she has asked us to stay so the house doesn’t feel empty

C) We are paying an additional $500 a month or so just in food costs alone, as we cook & buy all the groceries

In total, I’d say we splashed out about $1100 EXTRA a month, which significantly lowers their already-perfectly-generous budget, and gives them another $1100 to play with.

However in late 2012, my father made made some stupid, brink-of-our-relationship-breaking demands:

  • He wanted a gift from each of us kids each month to the tune of another $1000 a month, free and clear 
  • We were to pay for a new car every 3 years because he can’t take care of the ones he has, and drives like a goddamn maniac, smashing in the sides, denting the car, driving like an idiot

I was out by 2014 and I have never looked back since.

Photograph-Travel-Toronto-Ontario-Canada-CN-Tower-City-Urban

So what is the point of this whole recap?

This lesson:

MONEY RUINS RELATIONSHIPS IF YOU LET IT

Money is just money. It kind of saddens me that money becomes such a big problem between people that it causes rifts, because it’s just a tool.

It should be a lower priority than emotional ties and bonds with people you love, but in the end, I’ve observed that the MORE money someone has, the less happy they tend to be.


What everyone needs is just enough money for them. Not too much, not too little.

Whatever that balance is for you, find it and stick with it.

Don’t think that more money will solve your problems unless you are seriously living below the poverty line.

The problem has more to do with your attitude towards money, not the lack of money itself.

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Sherry of Save. Spend. Splurge.

Am my own Sugar Daddy. Am a millionaire at 36 after getting out of $60K of student debt in 18 months, a little over a decade earlier, using TheBudgetingTool.com. I have worked 50% of my career (taking 1-2 year breaks), and quadrupled my income within 2 years of graduating, going from $65K to $260K with an average lifetime savings rate of 50%. I have 11 side incomes that are on track in 2020 to make me $50K - $75K. I could retire today if I wanted, but love my work-life balance as a freelancing consultant in STEM (Science, Technology, Engineering, Math). I am all about balance - between time and money, and also enjoying my money. I also post daily on Instagram @saverspender.

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9 Comments

  1. Corianne

    Wow, I can hardly believe your father and brother scammed your mom! That’s just so awful! Scamming any person is horrible, but family? :O

    Reply
    1. save. spend. splurge.

      It makes it worse, no?

      Reply
  2. Ramona

    So sorry to hear about this. My folks are not great with managing money, but they dont’ even earn too much either. They could save a bit more, but, with the low income, I’m happy they don’t have debt and they do have a small emergency fund as well. I do help them out though, since it’s something I enjoy doing. But no one in our family ever resorted to such tactics as your father 🙁

    Reply
  3. Leigh

    It’s funny. I’ve been following your blog for years and years, and always drawn such strength from your approach to money and life. There are some similarities between our family situations that I am just now coming to grips with. I think 2015 will go down as the year I stopped looking back. I’m still in about $25k of debt between student loans and some personal debt, but the needle keeps moving in the right direction. I e tripled my income in the past 6 years, and that’s certainly helped! Keep preaching.

    Reply
  4. Xin

    Good golly at your father’s demands with the cars and the money. It’s good that you were able to draw the line on that.

    I am also from a culture that strongly values filial piety as an ideal, but my extended family doesn’t seem to take it to quite the same extent.. (Some of my grandparents had, in fact, continued to help out with some of my parents’ and my aunts’ and uncles’ expenses long after they were working adults.) My parents, who are divorced, really did both pull their weight with supporting my education and I see them working hard and doing their best, so I am happy to eventually contribute to supporting them when they need it. I haven’t really tried to calculate how much I will eventually need to do as I don’t have a good sense of what their retirement situation will look like, but I’m trying to be as financially savvy as I can right now to prepare for later.

    Reply
  5. Irene

    I thought our situation with the inlaws was bad. I think the $1000 gifts and new cars takes the cake though.. I’ve had to come to the realization that it isn’t my business, and that we live in Canada where there is a basic level of income and care for older people. Still, everytime my father inlaw says things like, “money is cheap” and “think of all the money I haven’t borrowed yet”, I cringe.

    Reply
  6. Sarah

    My dear girl, I feel for you and is a real credit to your brains and personality that you turned a bad situation into an advantage. if I may say so – as you are so clever about budgeting now. Thank you for all the tips, I enjoy your money posts and financial wisdom. I particularly dislike ‘penny pinching and pound foolish” please do a post on it.

    Reply
  7. raluca

    Wow. Just wow.

    Reply
  8. Christy Peeples DuBois

    You are so right and it saddens me greatly. I can only change me and my attitude therefore I can not do anything more about it.
    I am so sorry that you have had to go through what you have. Again, it is sad and pointless.

    Reply

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In a nutshell…

Save. Spend. Splurge.
[ wealth. style. minimalism. ]

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