Money gifts for aging parents to ease last years?

[Redherring]

We are FI and have +50X annual spending in investments. DW retired but I still work a high powered/paid job. One heir, who will get a very significant sum one day, and before that free education, house downpayment from us, etc to help. So we and heir are covered.

My parents are late 70s, father in poor health. They are managing but money is tight - about 100k net worth, 80% in house equity. No investments. They live on something like 2k/month net income per month (SS) all said and done. they know we are in good shape but not that we are multimillionaires, and they have never asked for any help.

I have been toying with the thought to gift them something like 10k per year. It would not make any difference to us but hugely for them. No strings attached. Any thoughts/ warnings on this? One thing I can think of is that they may get used to this and start to expect each year, which could mean pressure on relationship?

As an alternative, I know their main financial worry is replacement of their car soon. So we could maybe offer cash intented for their next car instead?

Also, DW’s parents are aging, but they dont need help. Do you beleive we are morally obliged to give same to them? I have yet to make clear proposal to my wife, I worry it could become a topic that we need to also gift them, although they have all they need


Any advise and experiences is much welcomed

[iris lily]

Man, this seems like a slam dunk to me. No, you are not morally obligated to help your parents. But because it would be so easy for you and it would make their lives easier, yes, do it.

[mistymoney]

No obligation to do both sets of parents, although DW may think differently.

If you parents were good parents, please make you gift asap especially with father in poor health.

[oldladystache]

For many years my parents gifted us money every year and we gifted my inlaws every month.

You have no obligation to treat both sets of parents the same.

[roomtempmayo]

I'd do it.  What's the point of money once you have more than enough if not to make other people's lives better, especially people you care about?

I see two approaches:

1) Lump sum.  Give them a new car or whatever, with no idea that there'll be anything in the future.  Doing it for a specific purpose minimizes future expectations.

2) Allowance.  Set up an auto-deposit monthly that'll alleviate their money worries and forget about it.

I think the choice between 1 and 2 depends on how willing you are to have this be ongoing.

Also, I agree with everyone upthread that there's no obligation to give both parents the same money, or to let DW's parents know at all.

[Cassie]

I think gifting your parents 10 K a year would be wonderful. It sounds like they really need the money and it doesn’t matter to you. No I don’t think you need to gift the other set of parents if they are doing well themselves.

[wageslave23]

Buy them a new car. Spend time with them and you will find other ways to help them financially.  Maybe their Dr wants him to go on an expensive medication, offer to pay for it. Maybe they've always wanted to go on vacation somewhere but couldn't afford it. Offer to take them.  I think you will get a lot of joy out of helping your parents in tangible ways. No obligation to help other parents who don't need it. But at least try to spend time with them and treat for small stuff like dinner.

[Catbert]

I don't think you have any obligation to give the same $$ to both sets of parents.  I have 3 sets of heirs:  step children from my first marriage, step children from my current marriage and my sisters.  While I treat each group the same internally, I don't  feel a need to treat the groups the same.  I don't give money to my sisters just bc I gave money to one group of step children.  Your DW may have a different opinion.

I would go with either a money stipend (e.g., $1000 a month) or random larger amounts such as a car purchase.  Giving on a regular monthly or yearly basis sets up an expectation rather than buying a car.  The biggest potential problem with an expected recurring gift is that they might raise their standard of living in a way that would be difficult to stop if you no longer want to make the gift.   

[TheFrenchCat]

I think you've received good advice so far.  You mentioned you haven't brought up this plan with your DW yet.  While I don't think the two of you are morally obligated to keep giving monetarily equal between your parents, I would want to know how she feels about it.  I think you'd need to be on the same page with this, and since you're not talking about huge (to you) sums of money, if she's not on board with it being unequal, then I think you keep it equal.  But if she's ok with things being different, then that works too. 

If I were in a position to contribute to my parents' retirements, I don't think I'd feel comfortable not giving my in-laws, who don't need it, anything.  But that's just me.

[Omy]

My parent is set up very well financially and has started giving his kids and grandkids large annual gifts. We buy dinners but haven't given large gifts to my parent.

DH's parents were very frugal while alive but didn't have a lot for extras. When they needed something (new car, new appliance, new carpet, new bathroom, etc), DH and his sibling would write the checks. It didn't amount to very much (under $2k per year on average), but it improved their quality of life. We liked doing it and they were always grateful. We never felt obligated - just happy that we could help.

[Freedomin5]

We were in a similar boat. In-laws lived paycheck to paycheck and didn’t have enough to cover emergencies. My parents were upper middle class and very wise with their money. Once, in-laws totaled their car and needed a new one. We gave them $5K earmarked specifically for the car. Lazy, unemployed SIL found out that DH (her brother) had given their parents a large sum, went whining to them about something or another, and in-laws ended up cashing the cheque and giving the money to SIL, then taking out a high interest loan to replace the car. Lesson learned.

We never give money to poor people anymore. When we want to help, we give tangible help. So, we give them a vacation, not the money to purchase a vacation package. We take them grocery shopping and pay for the groceries; we don’t give them a monthly stipend earmarked for groceries. If you want to be sure that they use the money well and don’t blow it at the casino each month or otherwise use it for stuff that go against your values, it’s much better to give them tangible things that actually benefit them rather than just giving money.

We also don’t give equally to both sets of parents. That depends on the parents’ character though. Will they get offended and hurt if they find out you’re giving to the other set and not to them? My mom doesn’t care. Her investments generate more than enough to live on each year, to the point that she’s actively looking to donate her money to minimize her tax burden. The last thing she wants is more money from us. Instead, she’ll ask me to give interest-free loans to my sisters to purchase a house or let my sister live rent-free in our house. Again, it’s either tangible help or specifically paying for something, not just a monthly cheque. My mom also knows that we help out the other side. She sees it as DH’s duty, so she supports it. But again, that’s her character.

But that really depends on your parents’ character. Some people use money wisely. Some don’t. You know your parents best and know what kind of person they are when it comes to finances. But if you want to make sure they use the money for things that actually improve their QOL, then it’s more certain if you give tangible help or actual things, and not money.

[reeshau]

We were in a similar boat. In-laws lived paycheck to paycheck and didn’t have enough to cover emergencies. My parents were upper middle class and very wise with their money. Once, in-laws totaled their car and needed a new one. We gave them $5K earmarked specifically for the car. Lazy, unemployed SIL found out that DH (her brother) had given their parents a large sum, went whining to them about something or another, and in-laws ended up cashing the cheque and giving the money to SIL, then taking out a high interest loan to replace the car. Lesson learned.

Experiences like this are why it's wise to give without strings attached, if you do choose to give.  People have their own priorities, and imposing your own is taking away their autonomy.

I'm not saying any gift is badly intended.  There are just entanglements down the road, that can make it backfire, for both parties.  Better to see it gone from your balance sheet, and the recipient happier in some way, rather than stew that they didn't do the same thing you would do, in their shoes.

[TheFrenchCat]

We were in a similar boat. In-laws lived paycheck to paycheck and didn’t have enough to cover emergencies. My parents were upper middle class and very wise with their money. Once, in-laws totaled their car and needed a new one. We gave them $5K earmarked specifically for the car. Lazy, unemployed SIL found out that DH (her brother) had given their parents a large sum, went whining to them about something or another, and in-laws ended up cashing the cheque and giving the money to SIL, then taking out a high interest loan to replace the car. Lesson learned.

Experiences like this are why it's wise to give without strings attached, if you do choose to give.  People have their own priorities, and imposing your own is taking away their autonomy.

I'm not saying any gift is badly intended.  There are just entanglements down the road, that can make it backfire, for both parties.  Better to see it gone from your balance sheet, and the recipient happier in some way, rather than stew that they didn't do the same thing you would do, in their shoes.

I think both giving without strings attached or giving tangible things only are both ways to avoid being disappointed by someone else's bad behavior.  But I don't think it's wrong to be disappointed by the parents' behavior in this situation.  They gave to specific people, for a specific purpose.  I don't think it's taking away the parents' autonomy to expect them to abide by the initial agreement.  If it wasn't for the car being totaled, they wouldn't be receiving money at all, let alone have the choice to give it away to their daughter. 

My grandfather and my parents gave me and my now-husband money for our wedding.  If we'd decided afterwards to elope and not have a wedding, we would've given the money back, since it wouldn't be fulfilling the original purpose.  They can respect our autonomy to elope while still wanted the money they earmarked for a certain purpose back.

[reeshau]

My grandfather and my parents gave me and my now-husband money for our wedding.  If we'd decided afterwards to elope and not have a wedding, we would've given the money back, since it wouldn't be fulfilling the original purpose.  They can respect our autonomy to elope while still wanted the money they earmarked for a certain purpose back.

It's funny you mention this.  FIL specifically offered (only slightly tongue-in-cheek) for us to elope and take the cash, rather than spend it on our large, multi-state family wedding.

[Dave1442397]

My parents' net worth is all in their house, and my father's pension is what they live on.

I like knowing that they have equity if needed, but they don't spend a whole lot. They seem to be doing ok, even if they worry about bills and budgeting.

My sister and I have enough that we can help out. Instead of just giving them money, we like to see what needs replacing when we're there, and so last time we bought them a new stove and a tank of home heating fuel to last the winter. We also give them vouchers for nice restaurants that they can use whenever, as they're both foodies.

My brother is in construction, and his crew have replaced their driveway, fixed fences, walls, etc. They do a great job and my brother pays for most of it.

I'm going to head over there later this year and take care of whatever deferred maintenance needs to be done, and just treat them to meals out, etc.

[YHD]

As a young adult, my mother asked my father to suggest to me that I pay a stipend to my parents which is what she did for her widowed mother.  I refused and it caused some resentment on both sides.  Especially since they were both frugal and saved well.

My MIL was a spendthrift and did not plan for her old age. She lived in with my SIL.

As our NW increased, we gifted each side what we thought they needed and wouldn’t buy/be able to afford for themselves.  Surprise cruises for my parents.  They found out they liked to cruise after the first one but were too cheap to spend on such things.

For my MIL, we paid for her upkeep beyond her SS.  Eventually covering skilled nursing facilities and associated health care.

Twist—my parents left a sizable estate for my sister and me.  I guess we just got our gifts back and then some.

Amounts were different.  Didn’t give cash.  Everyone was happy.

[Ladychips]

I think you've received good advice so far.  You mentioned you haven't brought up this plan with your DW yet.  While I don't think the two of you are morally obligated to keep giving monetarily equal between your parents, I would want to know how she feels about it.  I think you'd need to be on the same page with this, and since you're not talking about huge (to you) sums of money, if she's not on board with it being unequal, then I think you keep it equal.  But if she's ok with things being different, then that works too. 

I think @TheFrenchCat is spot on! Whether or not you give to your wife's parents, the issue is what's FAIR in your wife's mind.  So if you do something for her parents, you'd actually be doing it for your wife, not her parents.  Just like if she agrees to give resources to your parents, she's doing that for you, not your parents.

[LaineyAZ]

Going further, I'd be focused on the father's poor health.  That means things can change drastically and suddenly. 

Will your mother be able to manage financially upon his passing?  Will her living situation need to change?  Although some cash for immediate needs would be a good idea, I think there's more to discuss here.

[Turtle]

My grandfather and my parents gave me and my now-husband money for our wedding.  If we'd decided afterwards to elope and not have a wedding, we would've given the money back, since it wouldn't be fulfilling the original purpose.  They can respect our autonomy to elope while still wanted the money they earmarked for a certain purpose back.

It's funny you mention this.  FIL specifically offered (only slightly tongue-in-cheek) for us to elope and take the cash, rather than spend it on our large, multi-state family wedding.

My Grandpa did the same thing with my Mom. 

[Turtle]

Buy them a new car. Spend time with them and you will find other ways to help them financially.  Maybe their Dr wants him to go on an expensive medication, offer to pay for it. Maybe they've always wanted to go on vacation somewhere but couldn't afford it. Offer to take them.  I think you will get a lot of joy out of helping your parents in tangible ways. No obligation to help other parents who don't need it. But at least try to spend time with them and treat for small stuff like dinner.

This.  Be generous in the holiday/birthday gift budget for both sides, but don’t feel obligated to keep an exact ledger on it.  Newest model tablet or laptop for video calls/Zoom for example - the one side might not splurge on it but would appreciate, for example.  OK, actually maybe not as good an example since that one might be the same gift for both sides, but you get the idea.  Be the one to rent the large cabin/house/AirBnB for family vacations so that your parents can participate etc, etc…

[Redherring]

Thanks for all the input. This is really helpful and good food for thought, I am actually surprised about the quite consistent 1) do it and 2) dont feel obliged to give equally.

Going further, I'd be focused on the father's poor health.  That means things can change drastically and suddenly. 

Will your mother be able to manage financially upon his passing?  Will her living situation need to change?  Although some cash for immediate needs would be a good idea, I think there's more to discuss here.

This is a very good point. I dont expect she can afford to stay in the house when my dad passes away. That would definitely get me to support her, with my commitment to continue that. For now they are ok(ish) but not super comfortable..keeping the house on one SS, I dont see it how. Should my mother pass first it actually becomes even more complicated as he cannot take care of himself (Parkinson's). I have not thought through what would happen then!

[kite]

Sometimes good intentions can foul things up unimaginably.

No, I would not give them that much cash.
One is in poor health. He may be in need of skilled nursing care in very short order. The mechanism for funding that (in the US, I’m assuming they’re in the US) is Medicaid.
Medicaid will look at their finances for the past 5 years. And they’ll look intently at big inflows and outflows of money that suggest folks who seem poor aren’t as poor as they appear on paper.

You know they’re poor and ought to get what they’re supposed to. But these little things cause delays. And delayed care is denied care. Delayed care is why my brother’s metastasized Melanoma grew to the size of a grapefruit before he could have a $70 CT scan. I don’t know what CMS paid for his, but mine, with HDHP and a $12,000 deductible was $70 on the same body part. I had it 15 minutes after it was ordered. My brother waited 6 months thru denials, appeals and delays to schedule. Now he’s dead, so I’m a little bitter.
I take care of a man in his 70’s who is in a similar situation. In his case, it’s $9000 more in cash than Medicaid thinks he ought to have. The specifics of his tale are too much to get into, but him scrimping & saving, selling scrap metal & collectibles to save up for dental work is preventing him from getting the $70,000 procedure that Medicaid would otherwise pay for.

If a car would help them, give them a modest car. If a home health aide/personal care attendant would help them, hire that person and you pay. If they need home repairs or modifications to age in place; or power lift recliner, pay for that. Buy groceries, medications, etc. But don’t bump them above an income/asset level that might disqualify them for any state/federal/county aid for which they may be entitled.