Author Topic: Relatives who just don't get it  (Read 997602 times)

forummm

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Relatives who just don't get it
« on: February 04, 2015, 08:45:34 AM »
I'll be posting regular updates here about relatives who provide much shame and comedy. Please share your own as well.

Latest: An older spendthrift relative couple (spends about $100k more than we do) are both eligible for Social Security, have a mid-6-figure nest egg, and significant health problems, but "can't afford to retire" due to their profligate waste of money. One just quit his job and is going to dip into his 401k and take part time jobs to continue to fund their extravagance. His spouse has a 6-figure income. They are also going to cut back on loan payments to "save money".

Wasting money is kind of a badge of honor for them. They buy all kinds of things they never use, spend more on eating out in a week than we do for all our food for a month, throw away leftovers, upgrade appliances they don't use, etc. They hired an electrician to replace lightbulbs that I could reach without a ladder. They order $25 pay-per-view movies at a hotel when they know they will fall asleep in 5 minutes.

forummm

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Re: Relatives who just don't get it
« Reply #1 on: February 04, 2015, 08:53:45 AM »
Another relative had a several year old car that worked just fine, but wanted to buy a brand new car to drive on long trips (because putting lots of miles on the new car is the way to go, right?). He bought a nicer car than he needed (probably paying too much for it). He owed more on the old car than he got in trade-in credit (probably got screwed on the trade-in), so he rolled that extra debt into the loan for the new car. And his new, giant loan was at 26%! I didn't even know that was possible. His interest payments are 5 times his principle payments. In the end, the interest will cost him over 5 times the purchase price of the car when including the opportunity cost of the funds.

forummm

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Re: Relatives who just don't get it
« Reply #2 on: February 04, 2015, 08:58:10 AM »
One relative has bad credit. He wants to buy a house but can't qualify. But he can't even do simple things like paying his credit card bill on time, so his credit keeps getting dinged. He'll go over the maximum limit (fee) and not pay on time (fee plus interest plus credit score ding). Since his credit is poor, his credit limit is also low. I bet the fees and interest are something like a 500% effective interest rate on his card.

But they still waste a lot of money on stuff like bottled water, Starbucks, Whole Foods, etc, even on a small income. They'll never get out of the trap.

Fodder

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Re: Relatives who just don't get it
« Reply #3 on: February 04, 2015, 09:35:21 AM »
I have a family member like this.  He makes a good income, has very little in the way of obligations (renter in a one-bedroom apartment), but spends so stupidly I want to smack him.

Right out of school, when he first got a job, he bought a Jeep (a TJ, at the time).  10 years later, he still has it, but he's put THOUSANDS of dollars into it getting it jacked up, getting fancy tires, installing neoprene seats, getting fancy covers, towing systems/winches, etc.  It was his only car and he found the gas really expensive.....because it's a beast.

I should add that he very, VERY rarely goes off-road with it, and lives in a large city.

So what does he do?  Not sell it and use the proceeds to buy a reliable, well-priced used car.

Nope.  He stores it in my garage.....and bought a Volkswagon Golf TDI.  New, of course.  Fully loaded, of course.  I think it was something like $38k (Canadian) after all the options and tax.  He buys this because it's "good on gas" and has now saddled himself with a car payment for YEARS on a car that is only marginally better on gas than a car he could have paid cash for, had he been willing to sell the stupid jeep.

He recently told me that he won't be taking the Jeep out this summer (again, too expensive) and it will just live in my garage.

It just drives me crazy....seriously, he probably could have sold the Jeep for 13-14 grand, bought a great used car and had no payments, and no stupid Jeep sitting in my garage.  I let him leave it there because I have lots of space (we have one small car and the garage easily holds eight....thank the previous owner of my home for building it, because I never would have).  But because he'll "never get back the money he put into the Jeep" he leaves it sitting idle (and losing value), and because it's "good on gas," he is spending a fortune paying for a brand new car.

forummm

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Re: Relatives who just don't get it
« Reply #4 on: February 04, 2015, 10:09:27 AM »
One relative with a low income and a lot of debt bought a piano. Then he didn't have enough money to pay for rent, so he and his family moved in with her parents and put the piano in storage. So the piano (bought on credit) is sitting in storage (costing money to store) where it is unused. And he obviously couldn't afford the piano in the first place.

forummm

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Re: Relatives who just don't get it
« Reply #5 on: February 04, 2015, 10:11:09 AM »
Another relative has a 1%-er household income. After years of being high paid, his 401k balance is less than the amount he spent on his wife's ring. He doesn't even take advantage of the employer match.

forummm

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Re: Relatives who just don't get it
« Reply #6 on: February 04, 2015, 10:14:15 AM »
One spendthift relative encouraged me to buy something expensive I didn't want or need just because I could afford it. Yeah, I can afford to buy expensive things... because I don't actually buy them.

I'd rather buy VTSAX instead.

Pooplips

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Re: Relatives who just don't get it
« Reply #7 on: February 04, 2015, 10:21:34 AM »
After finding out we cut cable my FIL made the comment "Got rid of cable. Why are you being so cheap? You need to live a little."

Somehow he considers sitting around watching cable living.

Kris

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Re: Relatives who just don't get it
« Reply #8 on: February 04, 2015, 10:58:39 AM »
Another relative had a several year old car that worked just fine, but wanted to buy a brand new car to drive on long trips (because putting lots of miles on the new car is the way to go, right?). He bought a nicer car than he needed (probably paying too much for it). He owed more on the old car than he got in trade-in credit (probably got screwed on the trade-in), so he rolled that extra debt into the loan for the new car. And his new, giant loan was at 26%! I didn't even know that was possible. His interest payments are 5 times his principle payments. In the end, the interest will cost him over 5 times the purchase price of the car when including the opportunity cost of the funds.

Ugh.. This reminds me of my (now reformed, fortunately) DH.  When we were dating, as we got serious he wanted to reveal to me the state of his finances (good on him, at least, for realizing that he needed to do full disclosure before allowing me to make a decision to marry him that I might regret).  Well, one of the things I discovered was a couple of credit cards, on which he had five-figure debts, with USURIOUS interest rates of 24% and 25%.  And the worst thing was that he didn't even know -- he had never looked at the interest rate.  This is a guy who has an IQ of 159.  He got an earful from me, and I immediately made him get a 0% for a year credit card and consolidate the other two card debts onto that one.  Jesus, makes my blood boil just thinking about it. 

Luckily, he gave me complete control of our finances.  He now gets an allowance, I get final say in all of the financial decisions, and we are set to retire in 3 1/2 years, when I'll be 51 and he'll be 60.
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Re: Relatives who just don't get it
« Reply #9 on: February 04, 2015, 11:10:29 AM »
I am exceedingly fortunate that I don't have the relatives listed here (at least that I know of... don't know the financial details of all my relatives). My parents are somewhat spendthrift by Mustachian standards, but they still saved a substantial portion of their high incomes and are thus in quite a solid position to retire soon. Much of their financial wisdom I hope to pass along to my kids.

Pooplips - That is hilarious. I watch far too much TV via Netflix and Hulu Plus and over-the-air, but even I realize how this is not really "living". There might be certain circumstances where I might agree being too cheap keeps us from living a little, but having cable TV is definitely not one of them.

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Re: Relatives who just don't get it
« Reply #10 on: February 04, 2015, 12:02:57 PM »
My mom is a treasure trove of bad financial decision making stories.  She can't do too much damage now, because she only has SS disability.  However, her mother (my grandmother) died a year ago, and she got a small inheritance from her (maybe in the low 5 figures).   She had been without a car for 3-4 years, so she decides to buy another car.  Instead of buying a fuel efficient, reliable Corolla or something else that would hold up, she bought a 7 year old Ford Explorer that was in bad shape with a lot of miles on it.  A few months after buying it, the transmission went.  So now she is without a car again. 

cavewoman

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Re: Relatives who just don't get it
« Reply #11 on: February 04, 2015, 12:18:28 PM »
My SO's 2 sisters.

One has a really good job, making really good money, but she's so into expensive clothing, hair, makeup, weekends, etc. that after getting together her security deposit, and first and last months' rent to move, she had to borrow $200 from her parents (who live on a substitute teacher's salary and whatever her dad can scrape together by working a couple days a month and fixing and selling stuff). 

Then it's hard to write about her (actually both sisters) not getting it financially without adding in questionable aspects of their child-raising, but it makes me too mad, so I'll try to hold back.

The other finally got a job after 2 years of not working, except for the occasional massage.  Her well dried up last summer, she never evicted the tenants that live on that same property that stopped paying rent when the well dried up, she had to move into her boyfriend's parents' house with her 3 kids, and because her tenants haven't been paying rent and she hasn't been working, she is way behind on her mortgage.  Yet.  Brings her kids to her folks so they can babysit while she goes to parties every Friday night.  Smokes.  Her parent's just put her on their car insurance, her car has been unregistered for almost a year, it's a stupid big BMW she got from some guy she was having an affair with, oh my golly gee I have to stop typing before I bust an artery.

Of course none of that is her fault, it's the world working against her.  She's a POS mom.

My SO and I don't have kids yet, but his parent's have 6 grandkids with 6 different dads.  I know that's not the end all be all of them being shitty people but DAMN.

I'll take a couple of deep breaths and remind myself it's outside of my control, but I just feel bad for the kids.

eyePod

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Re: Relatives who just don't get it
« Reply #12 on: February 04, 2015, 12:31:47 PM »
frugality as a get-rich-quick scheme.

Hah! It's quicker and more reliable than any other option.
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Eric

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Re: Relatives who just don't get it
« Reply #13 on: February 04, 2015, 12:55:35 PM »
One relative with a low income and a lot of debt bought a piano. Then he didn't have enough money to pay for rent, so he and his family moved in with her parents and put the piano in storage. So the piano (bought on credit) is sitting in storage (costing money to store) where it is unused. And he obviously couldn't afford the piano in the first place.

Ouch!  Wow, that's ridiculous.  I imagine it was a brand new piano too, despite the fact that people pretty much give these away when they get into a situation like above.  Oh look, it's the circle of life!

After finding out we cut cable my FIL made the comment "Got rid of cable. Why are you being so cheap? You need to live a little."

Somehow he considers sitting around watching cable living.

Come over here and sit down next to me on the couch.  Now this is living!  Ha!
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Apples

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Re: Relatives who just don't get it
« Reply #14 on: February 06, 2015, 02:01:17 PM »
My MIL bought a new Ford Escape two springs ago.  She thought the new body style was pretty, and really wanted a new car (her current car was somewhere around 5-10 years old, I don't know, but in great condition).  They don't have savings and they couldn't really afford the monthly payments.  She whined for a few months to everyone about wanting the car "but DH says we don't have enough money".  Rolled home in it one day, w/o discussing it w/ my FIL.  Traded in her old car.  Said FIL was lying and they could afford it.

Last year, they could barely cover the expense of going to our wedding plus the rehearsal dinner, though she was adamant they would take a 2 week vacation and that dinner be expensive.  They are stretched pretty tight to afford those car payments.  My MIL misses work for a variety of physical ailments, so my FIL works nearly 7 days a week picking up overtime so they can meet their bills. By the time I'm 30, I bet we'll have more in retirement accounts than they do.

jprince7827

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Re: Relatives who just don't get it
« Reply #15 on: February 06, 2015, 03:14:07 PM »
My stepmom had a 2008 Audi A8L she bought back in 09 certified pre-owned for 70k - a beautiful car, the best I've ever had the privilege to drive. A couple months ago my Dad let her trade it in for 12k at 165k miles for a brand new 2014 Cadillac CTS fully loaded for 60k.

I can't believe it. That A8 was way better than the Caddy, and would've lasted another ten years - but she had to have the adaptive cruise control that the A8L just didn't have in 2008. That's literally the only reason she moved up. Spending an additional 50k just to get adaptive cruise control.

SMH.

irishbear99

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Re: Relatives who just don't get it
« Reply #16 on: February 06, 2015, 03:23:12 PM »
That's literally the only reason she moved up. Spending an additional 50k just to get adaptive cruise control.

Congratulations. I think you just won this thread.

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Re: Relatives who just don't get it
« Reply #17 on: February 06, 2015, 04:04:27 PM »
My father. Due to a car wreck, he may come into a lot of money. It's been with the lawyers for a year and a half. He wants me and the SO to teach him how to invest and save money like we do.

After they buy a gigantic house (with pool of course!), new cars (a Honda Ridgeline being one, because he 'deserves it, and can't have what everyone else has!'), vacations, and other "necessities".

I sent him a few of my favorite MMM articles the other day ('clown car' and 'luxury is another weakness') to start showing him how we handle our money. He hasn't read them yet. He probably won't.

Silverwood

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Re: Relatives who just don't get it
« Reply #18 on: February 08, 2015, 10:54:01 PM »
My grandparents or more specifically my grandfather and his vehicles.

My dad runs  his own business and my grandpa is constantly on him to replace his work truck so that others will know the business is doing well.

My parents also have an older paid off ford f-150. My dad does all the work on it himself or he gets his buddy to. I think they both help each other out with different things. My grandpa told my dad it was time to upgrade that old junker and criticized him for repairing it. The repairs cost $3000 and the truck wont need more work for at least a couple years.  My uncle purchases an older truck for $3000+  for fun to fix up and my grandpa congratulated him.

My grandparents are in their 70's and my grandpa has always had a nice vehicle. Never paying off and always trading up. They are snowbirds and have a place here and down south. I dont think either are paid off.  Their great-grandson was just born and I'm pretty sure they didn't come back because they couldn't afford it.
« Last Edit: February 08, 2015, 11:02:47 PM by Silverwood »

lakemom

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Re: Relatives who just don't get it
« Reply #19 on: February 09, 2015, 07:36:00 AM »
I have a family member like this.  He makes a good income, has very little in the way of obligations (renter in a one-bedroom apartment), but spends so stupidly I want to smack him.

Right out of school, when he first got a job, he bought a Jeep (a TJ, at the time).  10 years later, he still has it, but he's put THOUSANDS of dollars into it getting it jacked up, getting fancy tires, installing neoprene seats, getting fancy covers, towing systems/winches, etc.  It was his only car and he found the gas really expensive.....because it's a beast.

I should add that he very, VERY rarely goes off-road with it, and lives in a large city.

So what does he do?  Not sell it and use the proceeds to buy a reliable, well-priced used car.

Nope.  He stores it in my garage.....and bought a Volkswagon Golf TDI.  New, of course.  Fully loaded, of course.  I think it was something like $38k (Canadian) after all the options and tax.  He buys this because it's "good on gas" and has now saddled himself with a car payment for YEARS on a car that is only marginally better on gas than a car he could have paid cash for, had he been willing to sell the stupid jeep.

He recently told me that he won't be taking the Jeep out this summer (again, too expensive) and it will just live in my garage.

It just drives me crazy....seriously, he probably could have sold the Jeep for 13-14 grand, bought a great used car and had no payments, and no stupid Jeep sitting in my garage.  I let him leave it there because I have lots of space (we have one small car and the garage easily holds eight....thank the previous owner of my home for building it, because I never would have).  But because he'll "never get back the money he put into the Jeep" he leaves it sitting idle (and losing value), and because it's "good on gas," he is spending a fortune paying for a brand new car.

I hope he's paying you some rent on that garage!  At our self storage facility a unit large enough for a jeep would run $77 per month.

iowajes

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Re: Relatives who just don't get it
« Reply #20 on: February 09, 2015, 07:52:11 AM »
I still have no idea how you can spend ten grand per person in two weeks.


That's not hard to do at all, really.  Take a really nice cruise in a suite (especially somewhere exotic) or go on safari.  The Antarctica vacation I really really want to do runs about $18k per person for 2 weeks.

johnny847

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Re: Relatives who just don't get it
« Reply #21 on: February 09, 2015, 08:06:26 AM »
One spendthift relative encouraged me to buy something expensive I didn't want or need just because I could afford it. Yeah, I can afford to buy expensive things... because I don't actually buy them.

I'd rather buy VTSAX instead.
Last Christmas:
Friend: Do you have any things on your list?
Me: List?
Friend: Yea things you want for Christmas.
Me: VTSAX
Friend: What's that?


But as for the actual thread topic...I actually haven't heard of any dumb financial moves from my family. Maybe they've made them, but I haven't heard of them. It's basically the opposite - my parents  could've bought his house in cash, but got a mortgage instead, got a US treasury bond with a yield slightly greater than his mortgage rate, and claimed the home mortgage interest deduction (without that tax deduction, that would probably have a losing proposition because the return of bond interest is reduced by taxes, whereas the "return" of paying down a debt is not unless you include the home mortgage interest tax deduction.)

My parents taught me virtually nothing about taxes and investing (I learned that on my own) but they are pretty frugal. Not Mustachian frugal, but more frugal than the average American. I'm glad they instilled this sense of frugality in me (which only got activated once I had to earn my own money haha. Back in college when they gave me an allowance, I hardly saved any of it even though I could have).

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Re: Relatives who just don't get it
« Reply #22 on: February 09, 2015, 08:13:05 AM »
Another relative *clearly hates himself and goes out of his way to maximize his own suffering*
I am not exaggerating when I say that it physically hurt me to read that clusterfuck of retardation. I want to punch MYSELF in the face now. *ungggghhh*
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Re: Relatives who just don't get it
« Reply #23 on: February 09, 2015, 08:26:09 AM »
As you might imagine, not a single house was sold. 2-3 years in (I can't remember exactly), she had to take a dead-end entry-level service job at the age of 50.
Seriously?
I do it as a part-time job and turned a profit in my first partial year despite working 40 hours a week for the government and being out of town half the weekends. I can't imagine not spinning up rapidly once I actually have time to prospect.
I guess a lot of people get into the field thinking it's easy money and then realize you have to work to build a pipeline... it makes me sad. I genuinely enjoy it so much that I'm not going full-time until I reach the point where money is secondary.
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Fodder

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Re: Relatives who just don't get it
« Reply #24 on: February 09, 2015, 11:28:08 AM »
I have a family member like this.  He makes a good income, has very little in the way of obligations (renter in a one-bedroom apartment), but spends so stupidly I want to smack him.

Right out of school, when he first got a job, he bought a Jeep (a TJ, at the time).  10 years later, he still has it, but he's put THOUSANDS of dollars into it getting it jacked up, getting fancy tires, installing neoprene seats, getting fancy covers, towing systems/winches, etc.  It was his only car and he found the gas really expensive.....because it's a beast.

I should add that he very, VERY rarely goes off-road with it, and lives in a large city.

So what does he do?  Not sell it and use the proceeds to buy a reliable, well-priced used car.

Nope.  He stores it in my garage.....and bought a Volkswagon Golf TDI.  New, of course.  Fully loaded, of course.  I think it was something like $38k (Canadian) after all the options and tax.  He buys this because it's "good on gas" and has now saddled himself with a car payment for YEARS on a car that is only marginally better on gas than a car he could have paid cash for, had he been willing to sell the stupid jeep.

He recently told me that he won't be taking the Jeep out this summer (again, too expensive) and it will just live in my garage.

It just drives me crazy....seriously, he probably could have sold the Jeep for 13-14 grand, bought a great used car and had no payments, and no stupid Jeep sitting in my garage.  I let him leave it there because I have lots of space (we have one small car and the garage easily holds eight....thank the previous owner of my home for building it, because I never would have).  But because he'll "never get back the money he put into the Jeep" he leaves it sitting idle (and losing value), and because it's "good on gas," he is spending a fortune paying for a brand new car.

I hope he's paying you some rent on that garage!  At our self storage facility a unit large enough for a jeep would run $77 per month.

Nah, I couldn't do that to family.  If it were any sort of sacrifice, I would charge rent, but the garage is a 30x50 behemoth and I don't even notice the Jeep at the back.  He keeps fire and theft insurance on the jeep.

Mind you, my other brother just asked if he could keep the Cadillac he just bought from our grandmother's estate in our garage (1985 behemoth) and I said no to that because he would actually want to keep the car accessible, and that WOULD impede our use of the garage if we were constantly having to work around it.  ANd also it's the size of a bus.

We store a lot of stuff for people though - my SIL's winter tires and bikes, etc.

mm1970

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Re: Relatives who just don't get it
« Reply #25 on: February 09, 2015, 01:33:33 PM »
My brother! My parents were poor, and frugal, and most of us grew up pretty darned frugal.  But not the baby of the family, nope.

Part of it was the economic outpatient care that my mom provided until he was in his 30's (that's when she died.  And he's too much of a coward to ask our stepfather).

So my brother has generally been underemployed because he wanted an easier life and he's kind of an introvert.  So he quit good paying jobs to get easier jobs.  He quit a job, went to truck driving school, didn't like the company that paid for the school so quit (had to pay them back).  Then he got a job driving truck at 30 hours a week for not much money.  But he was happy.

His wife was the major income, working retail.  She made good money.
But they both liked to spend money.  They went through a string of new/used cars over 5 years, one every 9-12 months.  At one point, pregnant with their second child, they traded in their sedan for a second pickup truck.  Of course they lost money on each transaction.
They also ate out a LOT.  And my SIL would drive 45 minutes each way to work. And on her days off, she'd go shopping, but drive 2 hours one way.

But hey, she was the major income.

Anyway, last year she moved out of retail, so awesomely gets a normal schedule.  My brother was working 4 am to 11 am every day.  HE is so excited to get a new job at a prison (night shift).  What is the one thing he said to me at Christmas on the phone?  Well, FINALLY I know I can retire.  I can retire at 58 because my Army time will count towards the pension.  Because you know everyone here lives paycheck to paycheck.  You just don't understand.

(What I understand is that his mortgage payment was $375 a month and he and his wife made about $90k per year.  This was not an earning problem, it was a spending problem.)

be

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Re: Relatives who just don't get it
« Reply #26 on: February 12, 2015, 02:00:28 PM »
One relative with a low income and a lot of debt bought a piano. Then he didn't have enough money to pay for rent, so he and his family moved in with her parents and put the piano in storage. So the piano (bought on credit) is sitting in storage (costing money to store) where it is unused. And he obviously couldn't afford the piano in the first place.

Ouch!  Wow, that's ridiculous.  I imagine it was a brand new piano too, despite the fact that people pretty much give these away when they get into a situation like above.  Oh look, it's the circle of life!

Talk about people pretty much giving pianos away, it reminds me of my dad who has been offered the option to buy 2 different pianos from people who didn't want to move it.  Sort of a, you take it off our hands, you can have it. He just politely told them no thank you -- he doesn't play the piano!  I will say, I did take piano lessons as a child and my parents bought that piano 2nd hand and had it delivered to their house in the same moving truck that delivered my uncle's new to him bed.  So actually my father has been offered at least 4 pianos.  2 of which he actually bought, and 2 he said no thank you to.  My parent's 2nd piano was also 2nd hand.

paddedhat

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Re: Relatives who just don't get it
« Reply #27 on: February 14, 2015, 07:16:38 AM »
My stepmom had a 2008 Audi A8L she bought back in 09 certified pre-owned for 70k - a beautiful car, the best I've ever had the privilege to drive. A couple months ago my Dad let her trade it in for 12k at 165k miles for a brand new 2014 Cadillac CTS fully loaded for 60k.

I can't believe it. That A8 was way better than the Caddy, and would've lasted another ten years - but she had to have the adaptive cruise control that the A8L just didn't have in 2008. That's literally the only reason she moved up. Spending an additional 50k just to get adaptive cruise control.

SMH.
Well here is where I would politely disagree. Yes, it is possible to keep any car on the road for another ten years, and another 150K miles. However, doing so in a newer, extremely complex, yet not particularly reliable luxury performance car like an Audi, BMW or Mercedes, would typically be extremely painful on the wallet. We have friends that do this stupid shit. They spend $20K ish each, on a pair of Mercedes products, a big sedan and an SUV. This is all in borrowed money, of course, since you don't want to do something stupid AND pay cash for it. Not to even pretend that these idiots have that kind of money. Anyhow, they have a need to look wealthy, so the two cars are big, expensive when new ($75+ range) and well beyond warranty when they buy them. The next four years involve both high payments, AND extremely insane repair bills. One was over $3K when the sedan's auto leveling failed, and the car was stilling on the road one morning. It got a rollback ride, eighty miles to the dealer that day.  Eventually they pay the principal down enough, and the repair bills get ugly enough, that they start the whole process again.

 If you doubt that this is the typical outcome for owners of older, high end Eurotrash cars, stop by the dealer. The first thing you will see is that the employee parking lot has a notable absence of older expensive German cars, which is odd, since there are dozens of mechanics inside than can get parts cheap, and fix them for free. Unfortunately, they know better than to get involved in that mess. Next, talk to a salesperson about the type of folks that can actually afford a new, high end six figure car. One interesting point is that most of them will only drive cars that are under warranty, and are careful to trade in before they have to pay to fix the things.

I certainly agree that dropping $60K on a new Caddy was idiotic, particularly since they have a well documented reputation for being one of the least reliable cars on the road, if you want to drive the wheels off it, and keep for 10-15 yrs. However, that Audi is a ticking bomb, and the dealer did a courtesy trade on it. He determined what it was worth at auction ( about $5-7K) and gave that much for it. The rest of the $12K "trade-in" was a numbers game. Chances are, the Audi got rolled around back, and waited for the next carrier heading for the auction.

paddedhat

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Re: Relatives who just don't get it
« Reply #28 on: February 14, 2015, 07:46:30 AM »
As you might imagine, not a single house was sold. 2-3 years in (I can't remember exactly), she had to take a dead-end entry-level service job at the age of 50.
Seriously?
I do it as a part-time job and turned a profit in my first partial year despite working 40 hours a week for the government and being out of town half the weekends. I can't imagine not spinning up rapidly once I actually have time to prospect.
I guess a lot of people get into the field thinking it's easy money and then realize you have to work to build a pipeline... it makes me sad. I genuinely enjoy it so much that I'm not going full-time until I reach the point where money is secondary.
 

Sounds like you will do very well. I'm not sure if you are too polite to mention it, or if you are in a rare environment, agency wise, where it's not an issue, but successful realtors often do well since they have a traits that about 80% of their competitors lack. They are reliable, hardworking and competent.

 I was a builder, and investor for thirty years. I was perpetually stunned by the percentage of agents that were just total screw-ups. It was common to have my agent, settlement agent or lawyer go way out of their way to do, redo, or repair work that the other parties agent either failed to do, or screwed up.  Nothing like trying to close a deal when the other party accidentally got stuck with an agent who should still be working the checkout at Dollar general. One of my agents got so sick of it, that she would give one warning, then file a formal complaint with the licensing board, if the problem didn't get resolved. She pissed a lot of people off, but her attitude was that it was the only way to improve the situation. I was also stunned by the number of brokers who had zero issues with keeping F-ups and total non-producers on the roster. Or having to call brokers and ask them to step in and get their employee to actually do the job that they are legally required to do, and were getting paid to do.

OTOH, a competent agent is gold.  I was very loyal and grateful to the few who worked their asses off for me, and remained very loyal to them. Not surprisingly, a lot of these folks became very successful and wealthy over they years. Good luck.

Sibley

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Re: Relatives who just don't get it
« Reply #29 on: February 16, 2015, 02:06:15 PM »
 

Sounds like you will do very well. I'm not sure if you are too polite to mention it, or if you are in a rare environment, agency wise, where it's not an issue, but successful realtors often do well since they have a traits that about 80% of their competitors lack. They are reliable, hardworking and competent.

[/quote]

I have heard so many horror stories about real estate agents. I'm a professional, I'm accustomed to competency. I really don't handle idiots well.

mbk

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Re: Relatives who just don't get it
« Reply #30 on: February 16, 2015, 02:56:50 PM »
This post is about my neighbors whose income is much less than ours. Recently they bought a brand new second car. After noticing it, my wife & I hypothesized it as a bad move and forgot about it. Yesterday they volunteered few details about their financial situation and it blew me away.

They are from India and they are paying 24-48% APR on different loans in India with the total outstanding balance at $70k USD.

Their income is $3k/month after all deductions. It used to be higher, however they are expecting a baby in summer and now are on single income. Out of it, $1k goes towards car monthly payments, insurance and gas. $600 goes towards their share of rent. Here they are being sensible and co-renting with another couple. Paying only interest on the loans outstanding in India takes away another $1k. They have an ipad, iphone 6s and samsung galaxy s5.

And they were lamenting on not being able to buy house in bay area. I advised them to sell at least one car and any assets in India. They were somewhat receptive to the idea. But their main hope is on the second income after the delivery of baby.

mbk

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Re: Relatives who just don't get it
« Reply #31 on: February 24, 2015, 09:42:41 AM »
Another interesting thing happened with the family mentioned in the above post. I told them that I would help them in filing taxes so they could save $200. So, we sat down yesterday evening to file their taxes. After tallying every thing, I found that they owed IRS $1k+. When I told them that, they started throwing tantrums. They started blaming government for collecting too much tax, their employers for not withholding taxes, again government for collecting social security and medicare taxes and etc. Funny/irritating thing is that the lady has low-income medicaid insurance. They came with an expectation that they would get a refund around $2k. They kept wondering why they had to pay when everyone else was getting a refund. Seeing their tantrums, I didn't bother explaining them its actually good to not get a refund. They would have definitely thought of me as a jerk. The husband was lamenting that he wanted to buy his wife a $2k gift. And I kept my mouth shut for more than an hour and just listened to them. Finally they decided to file their taxes somewhere else. Today morning my wife mentions that the lady had already bought jewelry worth $1600 anticipating tax refund.

johnny847

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Re: Relatives who just don't get it
« Reply #32 on: February 24, 2015, 09:55:15 AM »
Today morning my wife mentions that the lady had already bought jewelry worth $1600 anticipating tax refund.
But...I thought they owed the IRS $1k+?

eostache

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Re: Relatives who just don't get it
« Reply #33 on: February 24, 2015, 10:06:02 AM »
Another interesting thing happened with the family mentioned in the above post. I told them that I would help them in filing taxes so they could save $200. So, we sat down yesterday evening to file their taxes. After tallying every thing, I found that they owed IRS $1k+. When I told them that, they started throwing tantrums. They started blaming government for collecting too much tax, their employers for not withholding taxes, again government for collecting social security and medicare taxes and etc. Funny/irritating thing is that the lady has low-income medicaid insurance. They came with an expectation that they would get a refund around $2k. They kept wondering why they had to pay when everyone else was getting a refund. Seeing their tantrums, I didn't bother explaining them its actually good to not get a refund. They would have definitely thought of me as a jerk. The husband was lamenting that he wanted to buy his wife a $2k gift. And I kept my mouth shut for more than an hour and just listened to them. Finally they decided to file their taxes somewhere else. Today morning my wife mentions that the lady had already bought jewelry worth $1600 anticipating tax refund.

This made my head hurt.

mbk

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Re: Relatives who just don't get it
« Reply #34 on: February 24, 2015, 10:13:03 AM »
Today morning my wife mentions that the lady had already bought jewelry worth $1600 anticipating tax refund.
But...I thought they owed the IRS $1k+?
They didn't know that till yesterday evening. The lady bought the jewelry few days ago. Yesterday, I definitely ruined their evening.

johnny847

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Re: Relatives who just don't get it
« Reply #35 on: February 24, 2015, 10:24:23 AM »
Today morning my wife mentions that the lady had already bought jewelry worth $1600 anticipating tax refund.
But...I thought they owed the IRS $1k+?
They didn't know that till yesterday evening. The lady bought the jewelry few days ago. Yesterday, I definitely ruined their evening.
Oh /facepalm. I missed the word "already."

Counting their chickens before they hatch.....

MgoSam

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Re: Relatives who just don't get it
« Reply #36 on: February 24, 2015, 10:26:53 AM »
One relative with a low income and a lot of debt bought a piano. Then he didn't have enough money to pay for rent, so he and his family moved in with her parents and put the piano in storage. So the piano (bought on credit) is sitting in storage (costing money to store) where it is unused. And he obviously couldn't afford the piano in the first place.

I've heard that it is can be easy to find a decent piano on craig's list for free or cheap so long as you can arrange to have it moved. Of course, if you buy a really nice grand piano, those might cost a pretty penny.

AH013

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Re: Relatives who just don't get it
« Reply #37 on: February 24, 2015, 10:35:54 AM »
Today morning my wife mentions that the lady had already bought jewelry worth $1600 anticipating tax refund.
But...I thought they owed the IRS $1k+?

No, you misunderstand.  When mbk prepared their taxes he said they owe the IRS $1k.  They're taking their taxes to an "expert" who will get them the $2k refund (plus their $300 fee) they deserve instead so they can afford that jewelry.  That jewelry will look pretty when she wears it with an orange jumpsuit. ROFL!

zephyr911

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Re: Relatives who just don't get it
« Reply #38 on: February 24, 2015, 01:40:05 PM »
No, you misunderstand.  When mbk prepared their taxes he said they owe the IRS $1k.  They're taking their taxes to an "expert" who will get them the $2k refund (plus their $300 fee) they deserve instead so they can afford that jewelry.  That jewelry will look pretty when she wears it with an orange jumpsuit. ROFL!
Ha! I've heard anecdotally of paid preparers fabricating itemized deductions, etc, to improve tax return results. I lost at least one client during my one year of paid tax prep to such an outfit.
Quite foolish to take such risks, if you ask me, for such small rewards, and as a taxpayer I don't appreciate it. The rest of us end up paying for that shit.
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Paul der Krake

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Re: Relatives who just don't get it
« Reply #39 on: February 24, 2015, 01:50:14 PM »
No, you misunderstand.  When mbk prepared their taxes he said they owe the IRS $1k.  They're taking their taxes to an "expert" who will get them the $2k refund (plus their $300 fee) they deserve instead so they can afford that jewelry.  That jewelry will look pretty when she wears it with an orange jumpsuit. ROFL!
Ha! I've heard anecdotally of paid preparers fabricating itemized deductions, etc, to improve tax return results. I lost at least one client during my one year of paid tax prep to such an outfit.
Quite foolish to take such risks, if you ask me, for such small rewards, and as a taxpayer I don't appreciate it. The rest of us end up paying for that shit.
Around here there are "places" that advertise refunds that are well over what a normal minimum wage earner with 2 kids would get back with a standard return and the EITC. I say "places" because it's really just a sleazy sign on the side of the road with dollar sign$ and a phone number. I can only assume they are scamming both the IRS and the taxpayer and disapear pretty quickly.

infogoon

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Re: Relatives who just don't get it
« Reply #40 on: February 27, 2015, 02:48:52 PM »
Around here there are "places" that advertise refunds that are well over what a normal minimum wage earner with 2 kids would get back with a standard return and the EITC. I say "places" because it's really just a sleazy sign on the side of the road with dollar sign$ and a phone number. I can only assume they are scamming both the IRS and the taxpayer and disapear pretty quickly.

I know my guy's legit, because he's got a vagrant in a Statue Of Liberty costume out front waggling a cardboard arrow and yelling at traffic.

kib

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Re: Relatives who just don't get it
« Reply #41 on: February 27, 2015, 04:49:38 PM »
"I have heard so many horror stories about real estate agents. I'm a professional, I'm accustomed to competency. I really don't handle idiots well."


 I feel that way about life in general.

RunHappy

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Re: Relatives who just don't get it
« Reply #42 on: February 27, 2015, 04:55:56 PM »
How about the one who keeping buying expensive pedigree dogs ($3k-$5k) but is constantly having the electricity turned off for nonpayment. 

wordnerd

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Re: Relatives who just don't get it
« Reply #43 on: March 02, 2015, 07:03:44 PM »
On his first day of retirement, my dad (age 72) spent $2300 today on getting the trees trimmed on 1/3 of an acre lot around the house.

My parents, by the way, have been making six-figures for the past 25+ years, but complain that they can't afford to retire and then buy $275 bottles of champagne at dinner. My mom is still working (six figure salary), and my dad is looking for part-time work in retirement so they can waste more money.
« Last Edit: March 02, 2015, 07:09:24 PM by wordnerd »

Gerard

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Re: Relatives who just don't get it
« Reply #44 on: March 02, 2015, 08:24:26 PM »
My friend and her siblings each recently inherited a decent chunk of money from a relative. Within a week, *both* siblings had asked my friend for a loan/gift of some/all of her share, because she "doesn't need it". Both siblings earn considerably more than my friend.

I have to admit, on this one, I find it easier to find the shame than the comedy.
"I can't believe you're still doing things your way after I explained why my way is better."

EdwardMonroe

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Re: Relatives who just don't get it
« Reply #45 on: March 02, 2015, 08:29:19 PM »
My parents, by the way, have been making six-figures for the past 25+ years, but complain that they can't afford to retire and then buy $275 bottles of champagne at dinner. My mom is still working (six figure salary), and my dad is looking for part-time work in retirement so they can waste more money.

While reading it, I forgot that your dad is 72 y.o. I thought it was me you're pertaining! You tale was indeed spot on to my life!
During the latter years of parents' lives, they rely on their kids. So if you’re accountable for the long term care needs of your parents, you've figured out that planning for the right care for your loved ones is quite tough.  http://lifeafterfiftycommunity.blogspot.com/

tmoney

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Re: Relatives who just don't get it
« Reply #46 on: March 02, 2015, 11:17:40 PM »
My BIL tells us how he looking to buy an $80k 5th wheel trailer ( for 2 people!) for camping but will also need a new truck.... They have never been camping in a trailer or tent and we have invited them dozens of times.   Same ones who had to borrow money for a medical co-pay

mbl

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Re: Relatives who just don't get it
« Reply #47 on: March 05, 2015, 09:55:19 AM »
I still have no idea how you can spend ten grand per person in two weeks.


That's not hard to do at all, really.  Take a really nice cruise in a suite (especially somewhere exotic) or go on safari.  The Antarctica vacation I really really want to do runs about $18k per person for 2 weeks.

I'm guessing that yes, that kind of trip was very extravagant....but the family memories will probably last a lifetime.
Sometimes you gotta say  WTH....go for it.    I could think of worse things in life.

Le0

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Re: Relatives who just don't get it
« Reply #48 on: March 05, 2015, 10:46:54 AM »
My parents live about 10 mins from a university. My mother works at the university, and my brother gets free tuition.

My brother goes to this university.

My brother also works about 10 mins from my parents house - sweet deal he can basically go in when he has time and make good money.

Here is the crazy part. My brother lived for about 2 school years in an apartment with a bunch of other guys about 10 mins on the other side of the university. Paying for everything - house, food etc. This means that pretty much his entire income from his job was spent on his bills. 

He has finally "run out of money" and moved back in with my parents. I can only imagine how rich he would be if he had just stayed home, did school and worked. Honestly he could have a down payment for a house by now.
I am working hard to move towards Financial Independence.

druth

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Re: Relatives who just don't get it
« Reply #49 on: March 05, 2015, 11:07:38 AM »
My future inlaws...

They lost more than 100k to a ponzi scheme many years ago (before I knew them), the leader said he had 'good christian values' so they trusted him.  Now they are involved in a pyramid scheme(life leadership), which couldn't possibly be a scam because it has 'good christian values.  They refuse to see any similarity.  Their kids have all tried to talk them out of this but they refuse to listen.

Recently their business went bankrupt and for whatever reason it wasn't tax shielded, so now they are going bankrupt as well.  Because they have really bad credit history they couldn't get a car loan, so they LEASED a brand new Ford Fusion.  Never mind that they had working cars and could have bought a nicer one with a few months of their lease payments.  They changed their minds and decided they wanted the equity instead so they gave it back(presumably taking whatever penalities as well), and buying a used 2014 Lincoln for 20k! (I can only imagine the terms of this loan...). 

From my understanding this could either completely derail their bankruptcy at worst, get taken back if the court thinks it isn't a reasonable expense, or maybe worst of all, they could agree to keep paying the payments even after they get out of bankruptcy.

I'm scared shitless of having to fund them when they are older.