In Discussions, Money, Retirement

Should you pay for your parents? – Talking about generational burden of aging elder care

I am coming of age where my parents are getting older, and soon, even though they do not want to, they are going to be unable to work, either mentally or physically.

Some of the prevailing North American mindset is:

Well, their retirement is their problem, not mine.

Others, take on their retirement as part of their duty because that’s just what has always been done.

So how do parents come to old age without having any money saved for retirement?

Lots of factors – some with and out of their control.

I am not excusing anyone, or blaming them either.

Just trying to state some points of view that aren’t considered when you think of the burden of aging parents and the complexity surrounding it because it isn’t as easy as saying you will give them money, or that you won’t.

Maybe they were immigrants

Some parents may have been immigrants like mine, new to a country and its practices, and did not know it was even a thing that you could/had to save money for retiring, as it has always been the children taking care of the parents as they aged.

Other parents, also like mine, may have been financially illiterate. My father never went to school, somehow landed my mother who now holds two degrees, who is now (after years of unemployment due to racism in a small town), the main breadwinner of the two of them, living it up on a six-figure income.

My father, also managed to move here with the entire family because he won the lottery. After winning it, he didn’t take time to think – OMG. How do I preserve this money? … and proceeded to go on spending and gambling sprees for the next 30+ years.


The only good thing that came out of that lottery win was a move to a new country and a house and car fully paid.

He ‘retired’ shortly after, and thought he had enough to live his entire life (another 40+ years) without having to ever work or save again. WRONG. OBVIOUSLY.

There’s so much more to that story, but basically my parents didn’t know what a retirement plan was, how to save it, what tax-sheltered meant, or any inkling of any concepts about investing.

They only saw: real estate and cash, like many immigrants.

They did not trust in the financial system, nor understood it, and it cost them dearly.

They had zero financial literacy, and never bothered to teach themselves.

Of course, they are also to blame (I mean how do you explain that so many other people figured it out and they didn’t?), but that’s one aspect.

Maybe they sacrificed everything for their children

A lot of immigrant parents (but non-immigrants as well), sacrifice a lot to pay for their children to go to school.

They see it as a way out of their situation – put all of their hopes into their child(ren) to go to school, get good jobs, make good money, and life will be better.

It is their way out.

The pressure is definitely on these children to deliver, and if they don’t, it becomes a burden, a noose around their neck.

They risked it all on one ‘investment’ (their children) and it didn’t pay off – and now their retirement accounts are empty or non-existent.

A lot of parents do this – they focus on their kids’ education plans at the cost of their retirement accounts.

They simply didn’t save.

Your children are not investments

For anyone who is reading this, it is a crapshoot.

Focus on your retirement savings, and secure that before helping anyone else, even your child. You need to be sure you are NOT a burden on them, like my parents will be on me as they age.

This is why I am focusing on ME, and MY retirement to make sure I am secure, and saving and investing Little Bun’s money for him to use for his future.

But if I had to pick between the two, I pick my retirement. I would never want him to be in his 20s, worried about me and how I am going to retire, but I get SO MUCH HATE for this.

SO MUCH that I had to write a post on it to re-clarify my intensions.

In all of these discussions about parental and elder care, the cultural aspect never comes up, and by that I mean — for many cultures, it is not even an option to say ‘No’. It is expected, required, and just how it is, that the children ARE going to take care of their parents.

It is not even an option in my culture, except I made it an option because of the way my father has treated me. I refuse to accept his care as my burden. One of my other siblings will take him in, I know it. And they can afford it, like I can.

I will only take in my mother, not my father, and it is simply not an option for me to send her to a nursing home (we will pay for a caregiver in-house if we have to), and it just isn’t done.

For people to give glib advice to those who are struggling with elder care, it doesn’t take into account cultural perspectives and I think that’s a real misstep.

A lot of us (again, not me, but people I know), live at home with our parents or grandparents, pay their mortgage, pay their bills, and take care of them with our money because that is what you do.

To say that their lives are their lives, and they should just cut ties, move out and be free of the burden, is really too easy of an answer to give, and one that isn’t even an option.

There is a lot of filial piety that is woven throughout these decisions that we make for ourselves and our family.

Some people my age, are even avoiding having children as not to pass on the burden of elder care to them.

I have no answer of what to do with elder care, especially as an immigrant with parents who are so off the money mark it isn’t funny, but I also feel grateful in that I do not have to think about it — I will be fine, my son will be fine, and so will my mother.

My plan is we will sell my parents’ paid off house if we must, and use that money towards their care – split in half. Again, my mother can move in with me if she wants or one of my other siblings, and I will contribute to her care.

So — be smart about money.

Don’t just sit on your savings, invest them.

Don’t wait until the last minute to think about retirement, today is already too late.

Choose your retirement over your childs’ educations if you must make the hard choice – don’t give nor be a burden on them.

Have a plan on what to do.

Educate your children about money as well – teach them what you wish you knew. Here are some books they can start with.

But what about our obligations in this case?

It’s hard to say. Really, I think case-by-case, we should look inside ourselves and see what we think is best.

If giving money means we are enabling them, then don’t give anything or if you want to help, pay their bills directly (don’t hand them the cash).

On the one hand, my parents suck at managing money. They still do. My efforts to have helped them have gone unrewarded.

On the other hand, how can I deny my parents what they want? They can’t help their money stories in a way, my mother grew up very poor, and she still works full-time because she wants to enjoy her money and life. It’s hard to change her now, although she isn’t in debt, she is spending every penny because she wants to enjoy life until her very last day.


So… because I can afford it, I will pay for them when the time comes.

My mom can move in with us, and I will cover her bills and care for her as much as I can.

My father can go with one of my other siblings who are also well-off and can afford to care for him.

But not many people are in this position nor can do so – they have to now try to balance out what to do and what they think is best.

What I’d really hope that they won’t wait until the last minute to implement these changes or come up with a plan of what they know is coming. If you know your parents need help – don’t wait now, start planning for it.

===========

The Cut wrote an article that sparked this above discussion and from that, I posted it and got comments from others on Instagram:

“I got into a heated argument with my dad the other day about my future plans. I’m 25 and trying to save up enough to move out of my parents’ house by 2020, when their lease is up. Since I started working at 18, I have been paying all my bills and contributing about $250–300 per month in “rent.” When I told my dad about my plan to move out, he was upset that I wouldn’t be helping them out financially anymore, and said I was being ungrateful for not thinking of their impending retirement. “

What others are saying:

These are actual direct messages to me from people on this topic that I found insightful especially with varied viewpoints.

———————

Yes I had to learn this the hard way.

Some people will give out financial support without expecting it back but others have strings attached.

I realized that a couple of years ago with a parent who started to rely on again for support while starting my first masters (after being completely independent for 3 years right after undergrad) and when that help was finally weaned off, I had to make some financial decisions that put me in a hole I’m still crawling out of it.

Same parent then said I should have asked them for money when I ran into trouble…our relationship hasn’t ever been the same since. That said, said parent made in retrospect some major unnecessary sacrifices on their finances so that I could be in a better position so idk*, very conflicted.

I do think the advice The Cut gives is fairly balanced given that the OP** is a first generation.

Also even in my family as a POC***, the elders tend to live with the younger family members if they can no longer support themselves.

*idk = I don’t know

**OP = original poster

***POC = Person of colour

———————

To be honest it isn’t fair for parents to have such expectations.

I understand to want to pay your parents back but where will it end.

Is she meant to live with them until they die and cater their every needs, what if she gets married if she buys her own house then is she meant to have them live with her?

I know personally I won’t be giving my parents any money. I’ll support my sisters yes but my parents and I’s relationship isn’t well enough for me to consider supporting them as I make my own money

Also want to add this is an issue within communities of color for sure. I’m lucky in my family to have seen my great grandparents literally housing their adult children until their deaths

And they have 12 kids.

I know very well if your parents can not control their spending what makes it any different if they’re using your money. A lot of my friends are constantly broke bc they give their parents their pay checks without looking at the family finances

It’s not just about being grateful to your parents but there’s literally pressure out on you to essentially take care of them

———————

Whew!!! I felt this.

My grandparents spent all their hard earned money borrowing it to grandchildren, children, siblings, friends that had zero intention of paying them back.

They counted on those repayments to live off of once they retired. They just retired at 72 & 80 and no one has paid them back. They have borrowed 100k out and now they have nothing but $1600 a month to live off of. They want me (their grandchild) to pay it.

But my point was this….. they want me to support them now. NOPE NOPE NOPE.

But I do lots for them all the time and I helped create a budget for them to survive off that $1600.

And then my sister tells me my grandma told her “Your sister made me a budget and is only giving me $25 a month to spend. She doesn’t want me to have money”.

My response “$25 is all she had for spending money unless of course she doesn’t want to eat for the month. They didn’t want to be reasonable with their budget. So $25 is all they have left to spend”

They made several choices with their finances.

Most of them involved supporting grown folks that should have been told “no”. Many families of color do this shit and expect their children and grandchildren to take care of them financially. It’s just not fair. Don’t get me wrong, I’m all for being there and being supportive but dang, I’m trying  to put myself in a better situation as well

I’m like “aren’t you relieved you can see that you can survive off your limited income?” budgets make me feel secure. Like I’m excited to do mine.

———————

This is a huge motivator for me, and something I’m terrified of with my mum.

She’s amazing, but has zero saved for retirement and is 55.

I don’t know how the hell I’m gonna be able to support her – I’m an only child so it’s all up to me. I never want my kids to worry about me like this.

———————

Honestly this is pretty normal in India.

Kids take care of parents until they die.

Irrespective of parents’ financial contributions

And it’s considered kid’s holy religious duty towards his parents.

Yes. I deliberately used his. Girls are not supposed to take care of parents once they get married. Only In-laws. Though this has changed to some extent for generation’s women.

Parents are always supposed to live with son and daughter-in-law unless they both of different jobs or farming etc.

Lot of couples grow old when caring for parents and their own kids simultaneously. Grow old as in physically not chronologically. And once they actually have some time for themselves on hand, they don’t have any energy to do things they always wanted to do in their youth.

But since I grew up seeing my mother taking care of my Grandparents, I don’t see anything unusual in this regard.

———————

This is so rough. We are in a similar situation.

My sister (27) is buying my dad a plane ticket across Canada so he can visit me/my hubby/my son for Xmas and I’m 25, he’s in over his head in debt and it’s rough cause me and my sister don’t want to take care of him and we’re both home owners now and starting families. We can’t take care of him too.

———————

I try to stay out of this kinda stuff, but when people talk shit about their parents it pisses me off.

Even if your parents don’t ask for it you’re supposed to fucking take care of them. They took care of you for 20 years and more. Obviously if they have bad spending habits don’t hand them money, but if they can’t make ends meet and you don’t figure out a way to provide them housing, clothing and food then I have what’s the point of anything. This is your family and more than that your parents, they raised you, paid for all your expenses, took care of every little thing and if you can’t accept them for their fault and help them live on and I think I’ve lost hope in humans.

I’ve seen a lot of people who’s parents make all sorts of sacrifices for them, like literally sacrifice everything for their kids, the kids then finish university debt free because his immigrant parents paid for everything, but even though they’re making 6 figures they don’t wanna pay for their parents, it’s shocking and shows how ungrateful they are

Honestly, just buy a calculator and run a DCF**** on how much your parents spent on you, then find FV*****, easily 500K

So just pay them back what you owe them for raising you and then it’s cool if you don’t wanna take care of them…

****DCF = Discounted Cash Flow

*****FV = Future Value

Thoughts?

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Sherry of Save. Spend. Splurge.

Millionaire at 36 after getting out of $60K of student debt in 18 months, a little over a decade earlier, using TheBudgetingTool.com. Since then, I have paid my $600K home in cash (my half was $300K), my $180K casr in cash, 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 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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5 Comments

  1. Maica @my.phinancial.diary

    Thanks for sharing. I think about this as well as since my parents will be retiring in the next 10 years. I know they haven’t saved up a lot for retirement for a number of reasons: they immigrated and lost a lot of money in the process (got taken advantage of financially pretty much as soon as we landed), my mom could never find a good paying full time job, they put more money towards my me and my brother’s schooling, they weren’t taught or learned about investing. The good thing is my dad eventually got a high paying permanent job that will provide him with pension when he retires. I’m not sure if it’ll be enough but it’s something. I love both of my parents so much and I know how much they sacrificed so that my brother and I could have better opportunities. I can’t imagine not taking care of them whey they’re old. And I definitely don’t want to send them away to a nursing home.
    I like the point you made about not sacrificing your retirement over Little Bun’s education. When I have a child one day, I plan to open an RESP account and contribute immediately but I will continue to work on my retirement savings all throughout as well.

    Reply
    1. Sherry of Save. Spend. Splurge.

      You’re so welcome. I know it is different for so many families, and each one has their own struggles to overcome. There is no right or wrong answer, really.

      You could also do it like me — contribute only the government money given for your children into an RESP. I don’t contribute any of my own money to his funds.

      Reply
  2. Revanche @ A Gai Shan Life

    This subject always makes me shake my head and wander away because UGH. Obviously, BTDT, so very very done with it all on a personal side. It’s going to be a long time before I get to the point of forgiving my parent for the financial crap he pulled.

    Reply
  3. steveark

    We would have taken care of our parents if they had needed it. But they were extremely good parents and both sets, mine and my wife’s had kids that were almost all millionaires or multimillionaires by the time our parents became old and frail, including me and my wife. It would not have been a burden for all of us to share in their care costs because they sent all of us to college debt free and taught us all to be responsible and frugal. And all of us kids on both sides had surplus money. Because our parents were smart and lived within their means with zero debt and lived frugally there was no need to contribute to their care. My dad, for instance, fully funded $8,000 a month nursing home care for him and my mom for years and his net worth just kept going up in spite of that. Eventually my parents provided one million dollar inheritances for me and my brother. On my wife’s side the legacy was a several hundred acre farm still owned jointly by my wife and her sisters. Since nobody needs any money from the farm it is just being leased out to family on a break even basis. Nobody cares about taking any profit from it. I don’t know what will happen with the debt free farm in the future, that’s not my business really, it belongs to my wife and she is very wise.
    I wouldn’t judge parents that fall into financial difficulty, not every family has financial success and the obstacles families face are unique, and some are insurmountable. But I have so much gratitude that my parents and my wife’s were frugal and taught us to save and invest and not to borrow money for anything trivial like cars or consumer goods. I’m also grateful they took our guidance in their final years to protect their assets while still living a full life. It has resulted in a tremendous amount of wealth being developed across two generations from greatest generation parents that had to struggle through the Great Depression with no money. My dad used to shake his head in amazement at how someone who never earned a big paycheck could become a millionaire by living within his means and investing well. He was living proof.

    Reply
    1. Sherry of Save. Spend. Splurge.

      Your and your wife’s parents are the type of parents who are basically the icons of the entire personal finance community. Work hard, be frugal, live modestly.

      They really passed on good values and I am sure generational wealth will keep building as a result.

      Reply

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