Article - Saving hard but not to retire

[Reader]

Another perspective on why be frugal.

https://www.thecut.com/2019/06/how-im-saving-for-my-parents-retirement.html?utm_source=pocket&utm_medium=email&utm_campaign=pockethits

[2sk22]

Nice article!

I'm increasingly convinced that frugality and saving are the only rational approach for young people in the modern world where all jobs are ephemeral.

[rothwem]

It seems like she’s working damn hard to be only bringing in 70-80k.

[kanga1622]

We could conceivably be supporting FIL if his sister (who FIL lives with) were to pass away first. I don't know enough about his finances to know what he has saved but I would guess it isn't as much as he probably needs. My parents have already passed and MIL/her husband seem to be financially stable and live life without any debt.

I do see this coming for many people of my generation. There was a time when everyone saved and then the older generation lived with the younger following retirement. As we've moved away from that model and people started relying so much on credit, there is a tipping point where too many people have lived beyond their means and taught that as the norm to their kids.

We likely will not FIRE but we are working to keep a healthy savings and increase retirement contributions. We don't want to burden our kids by making them feel like they HAVE to take care of us. With the changing landscape of healthcare, who know what that will do to our budgets in 25+ years as we are looking to entire retirement.

[wageslave23]

This seems a little extreme, like she has psychological scarring from her upbringing.  They have 1.7M saved ($68,000 yr @ 4%).  It sounds like they make $200k+.  And her parents are living with her (makes sense) AND she has 3 AirBNB people renting rooms in their house?!  It could be argued that she could FIRE right now and let her parents live with her in retirement on $68k yr.  If thats too tight of a budget at least kick out the AirBNB guests and keep working until you have $2M saved. 

[Aelias]

One thing I find interesting here is that at least both the parents and the daughter understood what the expectation was about her caring for them in their old age.  While I can imagine these kinds of cultural pressures can be really difficult in some situations, I find myself thinking, "Well, at least everyone knew the state of play!"

Both my and my husband's parents are still alive.  I am extremely grateful to my parents for not only being strong savers and financial planners, but for sitting down with me to review their assets, wills, and end of life plans. I don't have any doubt they are able to support themselves through retirement and, at least right now, their plan is to move into assisted living when they can no longer live independently.

Now, my husband's parents, though quite frugal and strong savers in their own right, are a total black box.  I have no idea how much money they have or what they want, need, or expect for their remaining years. I don't know where their will is or if they have one. They have no interest in any such conversation.

I wish we knew better how to talk about death, aging, and end of life issues. 

I'm increasingly convinced that frugality and saving are the only rational approach for young people in the modern world where all jobs are ephemeral.

This too.  I'm so glad I got to see in 2008, near the beginning of my career, how abruptly jobs can end.  It was the formative experience of my professional life and definitely informs my attitude about saving and frugality.

[honeybbq]

Where did her Mom go?

Honestly, it's kind of her to take care of her parent(s)? but this sounds like misery to me. $1000/month for 3... no eating out, no going to movies, never going on vacation. It's one thing to save your money and not spend foolishly. Sounds like they NEVER spend money. Sometimes spending money is worth it.

[lilsaver]

When she talked about having her husband take care of her parents if she died early, that was really hard to read. That's an extremely big burden to ask someone to take on, even for a spouse. She's saying they don't need much help now because they can get around on their own and have Medicare and Social Security, but as her parents will age, there is a high likely of other problems like illness, etc. That's a HUGE burden. Some conditions require a lot of help and commitment, and who knows how long anybody will be sick. Even if there's money set aside for pay for caregivers, etc, managing that and providing oversight still requires some kind of commitment from a trusted family member. And, what will become of her parents if her spouse becomes ill himself?

I hope she thinks of a better plan for her parents. They need training on things they can do to become self-sufficient. Even if their English skills are limited, she can encourage them to take ESL classes, research local programs, etc. Since she's entrepreneurial, maybe she can teach her parents how to run one of her businesses, like the AirBNBs, so they can gain some skills, etc. She's certainly taken on a lot of responsibility for herself, and that's on her, but to project that onto her spouse to carry on as the only back-up plan, doesn't feel right. I feel for the guy.

[wageslave23]

When she talked about having her husband take care of her parents if she died early, that was really hard to read. That's an extremely big burden to ask someone to take on, even for a spouse. She's saying they don't need much help now because they can get around on their own and have Medicare and Social Security, but as her parents will age, there is a high likely of other problems like illness, etc. That's a HUGE burden. Some conditions require a lot of help and commitment, and who knows how long anybody will be sick. Even if there's money set aside for pay for caregivers, etc, managing that and providing oversight still requires some kind of commitment from a trusted family member. And, what will become of her parents if her spouse becomes ill himself?

I hope she thinks of a better plan for her parents. They need training on things they can do to become self-sufficient. Even if their English skills are limited, she can encourage them to take ESL classes, research local programs, etc. Since she's entrepreneurial, maybe she can teach her parents how to run one of her businesses, like the AirBNBs, so they can gain some skills, etc. She's certainly taken on a lot of responsibility for herself, and that's on her, but to project that onto her spouse to carry on as the only back-up plan, doesn't feel right. I feel for the guy.

After living on $1000/mo and living with his FIL and 3 AirBNB'ers I'm sure the husband is just smiling and nodding at this point....

[Buffaloski Boris]

Great article! While their lifestyle isn’t to my taste, it looks to suit them.

[KathrinS]

Nice article!

I'm increasingly convinced that frugality and saving are the only rational approach for young people in the modern world where all jobs are ephemeral.

Amen. It’s what I’m trying to teach my kids.

This, and also self employment. I can lose one or even several of my clients at a time. But it is highly unlikely that I am ever completely out of work at any given time, whereas in a traditional job, it's more of an 'all or nothing' situation.

[Reader]

Where did her Mom go?

Honestly, it's kind of her to take care of her parent(s)? but this sounds like misery to me. $1000/month for 3... no eating out, no going to movies, never going on vacation. It's one thing to save your money and not spend foolishly. Sounds like they NEVER spend money. Sometimes spending money is worth it.

from the article, her mum is still working and staying on her own. i was pretty astounded by $1000/month for 3 too but i guess it could work as she works from home so she need not commute, dress up or spend money on hanging out.

taking care of parents (financially) is a given in some cultures. i loved it that she was pretty frank that she's taking care of the financial bits while making sure she would not be physically staying with them.

[Rosy]

Wow - to me, this is the definition of a horror story.

$1,7M saved and $200K income p.a. and yet, she's convinced herself and her husband that it is necessary to live on $1K a month and that they have no other alternatives, forgoing all pleasures in the here and now?

The only thing here that is apparently non-negotiable is the parent's expectations. I can't help but think how ignorant or perhaps arrogant and questionable it is that she does not seem to understand how well to do $1,7M and $200K income really is - here in the United States.

Although that isn't much $$$ compared to the crazy rich Asians I've come across in Europe, but then at least they wore Gucci and Armani and they enjoyed the life and style...
This lady is not living in the basement like the family dog anymore, (as she mentioned in the article) but mentally she is still there.

Pie in the sky expectations of multiple residences and millions in the bank - yup, we all live like that in the US, get a grip. Were she to do a case study here it would probably show that in another five to seven years - she will have reached those expectations.
Welcome to the life of the privileged.

This is an utterly insane life(style) and has very little to do with the millions of Americans who may one day be asked to help out their parents financially.
I am an immigrant and I'd die of shame if I was forced to ask my son to support me in my old age.
It means you failed - you didn't make the cut.
So much for cultural expectations.

I've helped out my mother overseas over the years here and there, just as she did me - we're family, but that isn't any different from the families that I know here in the US.
Everyone's situation is different and you do well to prepare ahead of time as much as you can, that's just common sense.

This seems a little extreme, like she has psychological scarring from her upbringing. 

They have 1.7M saved ($68,000 yr @ 4%).  It sounds like they make $200k+. 

And her parents are living with her (makes sense) AND she has 3 AirBNB people renting rooms in their house?!

It could be argued that she could FIRE right now and let her parents live with her in retirement on $68k yr.  If thats too tight of a budget at least kick out the AirBNB guests and keep working until you have $2M saved. 

Agreed.
If I were to guess I'd say that $2M is not enough - she means to be crazy rich. ... besides, she wants to buy another house nearby - probably in the millions too.
This woman will never have enough millions to her name, ever.

I do not aspire to a thing that is presented in this article.
If I were young, like 30 and could save $200K for five years to add a quick million, yes I'd do that.
But there is no way I'd dedicate my life to mammon and live in one room of my own spacious home for decades.

... I call BS on her not saving hard to retire - it's just that she's saving hard to retire her parents in style first - that's all. She's already planning on buying a second residence for herself. She'll make her parents proud and enter the ranks of the privileged - mission accomplished.

[Bloop Bloop]

I'm not sure I agree that all jobs are ephemeral. I don't see many bankers, trial lawyers, doctors or dentists struggling.

I accept that a lot of middle-class jobs are now precarious.

[MrThatsDifferent]

Ok, I get it after reading the article. Not sure I understand so many of the criticisms here. She grew up super poor, never wants to be that poor ever again and is ensuring that she will have money for herself and her family for generations. That’s admirable. Because of how she grew up she learned that she doesn’t need much. She understands what’s she’s doing and she has a plan. I think she’s as optimized as possible and living a truly mustachian life in the MMM ethos more than 99% of us. Applaud her, the same way you’d applaud MMM.

[2sk22]

I'm not sure I agree that all jobs are ephemeral. I don't see many bankers, trial lawyers, doctors or dentists struggling.

I accept that a lot of middle-class jobs are now precarious.

I will readily agree that doctors, dentists and some lawyers. But my brother who has worked in banking all his life is absolutely desperate to get out of the field asap, although he's a senior manager and is very well paid. Banking has become a brutally competitive business and very few people retain their jobs much past 50 - which makes my brother a real survivor. Consider that there's almost no competitive difference between the banks and they are all searching for the same deals in the same places.

[wageslave23]

Ok, I get it after reading the article. Not sure I understand so many of the criticisms here. She grew up super poor, never wants to be that poor ever again and is ensuring that she will have money for herself and her family for generations. That’s admirable. Because of how she grew up she learned that she doesn’t need much. She understands what’s she’s doing and she has a plan. I think she’s as optimized as possible and living a truly mustachian life in the MMM ethos more than 99% of us. Applaud her, the same way you’d applaud MMM.

MMM never lived a life of deprivation.  He has said that mustachianism is not about depriving yourself or being miserable just so you can amass a bunch of money or retire early.  Its about living a full life and not being wasteful with your money on things that won't improve your life.  I could be wrong but it seems like the woman and her husband are not living their best life.  They are depriving themselves just so they can "get ahead" or have the illusion of more "security".

[ericrugiero]

Ok, I get it after reading the article. Not sure I understand so many of the criticisms here. She grew up super poor, never wants to be that poor ever again and is ensuring that she will have money for herself and her family for generations. That’s admirable. Because of how she grew up she learned that she doesn’t need much. She understands what’s she’s doing and she has a plan. I think she’s as optimized as possible and living a truly mustachian life in the MMM ethos more than 99% of us. Applaud her, the same way you’d applaud MMM.

MMM never lived a life of deprivation.  He has said that mustachianism is not about depriving yourself or being miserable just so you can amass a bunch of money or retire early.  Its about living a full life and not being wasteful with your money on things that won't improve your life.  I could be wrong but it seems like the woman and her husband are not living their best life.  They are depriving themselves just so they can "get ahead" or have the illusion of more "security".

+1

The lady in the article seems to be living an uncomfortably frugal life when she doesn't need to.  She has enough now to take her foot off the gas a little and enjoy life.  Taking care of her parents is a good thing and expected in her culture but she doesn't need to be depriving herself so much to manage it. 

My wife's parents haven't been smart with money so there is very real possibility we will be helping them as they get older.  They may end up living with us or needing other types of assistance.  I'm OK with that because they are wonderful people who just aren't very good with money.  They are very proud/independent people who won't want to be a burden so I'm not concerned with them "taking advantage" of us.  Some of their financial struggles are due to the sacrifices they made for their children including my wife so in some ways we will just be paying back that debt. 

[Freedomin5]

I think what is viewed as deprivation in one cultural context is not considered deprivation in another cultural context. She came from a background where she and her parents lived and slept in one room. She now has a four bedroom house and she and her parents have separate bedrooms. To us, the lifestyle may be uncomfortable and deprived. To her, it may be comfortable.

I read her article from the standpoint of many mainland Chinese that I know, and I can see how her current lifestyle can be viewed as luxurious and full by most of the people here. In alignment with Chinese values, she owns her own house, has multiple income streams, married well, takes care of her parents, and has a good education. I’m a bit surprised her parents let her study psychology, but other than that little quirk, she is living the Chinese dream. Oh, and she just needs to give birth to a grandchild for her parents, and then she’s good. :P

[Cassie]

I wonder if her marriage will survive?

[avrex]

She told her husband that taking care of her parents is nonnegotiable.  That's very honorable of her. 

But, based on her own words below....

They have very different belief systems. Like, they don’t believe in antibiotics or certain types of medicine. They aren’t tolerant of certain other ways of life. It’s difficult sometimes. They’re not the kind of parents that you want to hang out with and have them help raise your kids. We argue a lot about how to do things.

... I wouldn't be too happy living with these parents.

[soccerluvof4]

Everyones path is different and I respect her purpose. I am sure it brings happiness to her and that is the point in life. Seems she was upfront with her husband from day one. Was a nice article thanks for sharing.

[Bruin]

PTSD due to childhood poverty?

The woman finds security in "savings". To cope with the deprivation during her childhood, she could have turned to the total opposite way and spent every dollar on things she never had when growing up. I don't agree with both extremes, but can understand. If she and her family are content with their life style, I don't see anything wrong with it.