Author Topic: Moral Dilemma - building FI on the back of your parents  (Read 9253 times)

Littlekind

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Moral Dilemma - building FI on the back of your parents
« on: March 18, 2016, 05:54:56 AM »
Hi, this is my first post. I found MMM after that huge article that made him sound like he denies his kid packs of Magic cards. Came here to read the whole story, and am all-in. Actually we've been working really intermittently hard at getting out of debt ever since we got married almost 8 years ago. My question is about "getting ahead" by relying on a parent who herself is not FI but doesn't want to be.

3 years ago we started renting part of my mom's house from her (2 bedrooms, 900 sq ft, Denver metro area) for 850 a month. This was nearly fair rent then but isn't anymore. I'll spare you the details, but my mom's finances give me panic attacks. It's not bad by the standards of our culture, though. She could definitely rent this place out for more, but she doesn't want to deal with renters. She really doesn't want us to leave but if we do, she will sell this place and get a senior condo. With home values up in Denver, that could make a huge difference in her own financial stability. Yet, she doesn't want us to leave. We are starting to look for homes because it feels like we are taking advantage of her - and her lack of concern over her own finances. We also are 30+ with kids and want to be on our own. Buying costs less than renting, we want to live in this area for the long term, and we qualify for a no pmi, low down payment loan because of our low income.

My question is really whether it is unfair to live with my mom, thereby further reinforcing her debt-dependent lifestyle, as a means to save money and reduce our own debt.
After rent, bills, living expenses and everything, we have about 700-1000 left each month. It was hard to accomplish this!
We have 6,000 in a savings account.
We have about 50,000 combined student loan debt left.
We already paid off our car, the credit cards our younger stupider selves racked up, and one student loan.
We paid for our wedding and rings with 5,000 we had saved before.
We both have retirement accounts at work that we're contributing barely anything to, because our employers don't match it. I think I contribute about 300 a month and my husband contributes like 20 dollars. I feel like I don't understand investing at all and have a fear that we're going to mess up with our goals. I feel like I can't be trusted with my own money because I never learned how this works.
We cannot increase our income right now because my husband is home with our kids and works part time. We both feel it is really important to give our kids as much of our time as possible. We do pay about 300 a month for our son to go to preschool, which we will not do next year. I also just took a new teaching job in a current neighborhood (yes...next to the home I want to move out of). So after this school year we are going to sell car 2, I will commute by bike and that will free up some funds, too. That decision, of course, being a direct result of reading MMM.

I see lots of great advice in the comments and forums, and would definitely appreciate some perspective. Thank you.

It feels like it makes most sense to stay here a while, do my bike commuting, save more money, let the market hopefully cool down in Denver, and buy something later. But I cannot stop calculating how much our presence here is costing my mom every month.

lizzzi

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #1 on: March 18, 2016, 06:13:41 AM »
My first quick thought is: Why not just keep on doing what you're doing, but pay your Mom fair market rent? It seems like that would help all of you. I agree that it seems to make the most sense to stay there.

Littlekind

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #2 on: March 18, 2016, 06:16:08 AM »
Thank you Lizzzi, I meant to mention that - she honestly will just not take it. Even with the rent we're paying now, she is using part of it to pay down one of my student loans. I have mentioned that we should pay her more and she says she is going to put it toward my loans if we bother trying.

She is incredibly generous, to her own detriment.

Neustache

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #3 on: March 18, 2016, 06:19:00 AM »
Without knowing more hard figures (what she could sell for, what she could get a condo for, etc) I'd say you are not taking advantage of her.  The more financially secure you are the more you will be able to be there for her as she ages - run her to doctor's appointments, do grocery shopping for her, etc.

Move if you want to, but I don't see a problem - $850 a month is probably nothing to sneeze at and for a house sharing situation seems quite in line.  What's her monthly mortgage payment, anyways? 

We have a ridiculously large house (1900 square feet) that could probably fit three small families in it.  I'd personally be fine if my kids and their kids lived with us, as long as we had one room where we could go and get away from the noise.  If my kids were using that time to catapult them into FI territory, I'd be totally down with that.

Filliteracy

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #4 on: March 18, 2016, 06:20:31 AM »
Littlekind,

It would help if you listed the info as per stickie "how to write a case study", however, my two cents from your situation: Your student debt is an emergency (what's the interest rate?), so work on paying that off as quickly as possible. When you say "buying costs less than renting", it sounds to me like you are making a generalization and haven't run calculations (have you gotten a mortgage pre-approval to see what your interest rate would be? having had those credit card debts long term may have had an impact on your credit). When you are comparing buying a house to your current rent, only count the interest portion payment of the mortgage + municipal taxes + utilities. But it really sounds like your mom is happy with the status quo, so I don't think you are taking advantage of her per-say.

TL;DR Pay off your 50 000$ debt, save up at least a 10-20% downpayment or/and nest egg bigger than 6000$ (possibly 1-year worth of income?) then consider changing your living arrangment if you feel like getting a subsidized ride via cheap rent from a family member jeopardizes your mental wellbeing. 

ooeei

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #5 on: March 18, 2016, 06:20:51 AM »
Thank you Lizzzi, I meant to mention that - she honestly will just not take it. Even with the rent we're paying now, she is using part of it to pay down one of my student loans. I have mentioned that we should pay her more and she says she is going to put it toward my loans if we bother trying.

She is incredibly generous, to her own detriment.

Sounds like you tried.  She wants you to stay there, and is satisfied with the rental rate you pay.  I don't see any advantage taking here.

Neustache

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #6 on: March 18, 2016, 06:26:02 AM »
Another way to look at it is that some parents pay for all of their kid's college - maybe this is her way of doing that for you after the fact.  Seriously, you sound as conscientious as one can hope for a kid, I'm sure you'll take good care of her in the future. 

slappy

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #7 on: March 18, 2016, 06:26:12 AM »
I'm in a similar situation. I'm 31 and my mom still pays my cell phone bill on her family plan.  She is the type to try to buy our love. When I told her I was pregnant with my second child, her response was that I would need some things for the baby and I should take $1000 from her checking account.  When she came to visit me because my husband was in the police academy and I needed help with the baby, she paid for every single thing. Including my car repair, because I asked her to drop off the car to the repair shop so I didn't have to miss work.  I put money for the repair in her jacket pocket and she pretended she didn't know what it was and tried to give it back to me.  I stood my ground on that one.

Finances are really tight for us right now, so I've been allowing it.  Mostly because I know that's how she wants it. I think she enjoys telling her friends about her grandchildren and how she helps us out. I guess it's her love language. I justify it to myself by telling myself that I will pay it forward to my kids and pay for their student loans, etc.

slappy

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #8 on: March 18, 2016, 06:26:34 AM »
Another way to look at it is that some parents pay for all of their kid's college - maybe this is her way of doing that for you after the fact.  Seriously, you sound as conscientious as one can hope for a kid, I'm sure you'll take good care of her in the future.

This is exactly how I look at my situation.

kite

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #9 on: March 18, 2016, 06:45:30 AM »
How much interaction do the kids and their grandmother get in the current arrangement versus what it'll be like when your mom is off in the "senior condo?"
She's deriving value in some important, non financial ways right now.  Any question of the "morality" of the status quo should take that into account.  The feeling of joy from helping family who need you is primal.  And you need her.  Your debt levels are an emergency.

mashrach

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #10 on: March 18, 2016, 06:57:28 AM »
First off it sounds like you have an amazing mom, that's more valuable than lots of money to me. My mother would and has done the same for me and I will do the same for my kids, and I'm willing to bed that you will do the same for yours. As someone mentioned she is getting value by being near you and your children rather than in a condo. Just remember what she's done and be there for her as she ages, at some point she might become what some would call a burden, so just do for her what she would do for you. Good luck with everything.

slappy

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #11 on: March 18, 2016, 07:00:00 AM »
  And you need her.  Your debt levels are an emergency.

This is where the moral dilemna comes in, at least for me.  Sounds like OP may have a slightly different dilemna.  But my thought it, could I afford X if it wasn't for my mom, and sometimes the answer is no. So basically, if it weren't for her paying for some things, I would have even less retirement savings. In my case it's a cell phone bill. In the OP's case, the mom is essentially paying a portion of their rent. 


Littlekind

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #12 on: March 18, 2016, 07:04:35 AM »
Thank you everyone. It seems so obvious now that I hear it from others. I just want to be sure we are doing the right thing all around, and of course culture and our friends say getting out on your own is the right thing.
 My dad left us and remarried shortly before I went to college and she does feel like she didn't help me pay for it the way she wanted to (not that I expect her to) and her childhood wasn't good so she always has been really indulging and generous to me and my sister, which probably contributed to my own entitlement sickness but her heart is good. She's also super conscientious of giving my family our own space and not offering an opinion on decisions my husband and I are making together. So when I try to run scenarios by her about going or staying, she doesn't want to talk about it. But like ooeei said, I did offer more rent and she's happy with this situation.

And Mashrach and Kite, you are right that she is amazing. I should just be grateful and focus on job one: the debt. Like slappy said, I know there are lots of things we could not afford if not for my mom helping us with housing, and I feel like I am justifying using her because I have an entitlement problem. But she is a willing participant and I love her generosity.

@frugalix thanks for mentioning the case study. I read that post but I'm new so I didn't recognize that I am writing one. I will go back up and add in the details of the mortgage. An apartment in our neighborhood (3 bedroom) costs between 1800 and 2500 monthly. We qualify for a 200,000 mortgage (5% apr, no pmi) and I have seen 3 townhomes with 3 beds in our neighborhood in the last year come on the market in that price range. So they are hard to find, but exist, and would be less than rent but still more than I feel like paying when I still have so much debt.

@neustache I don't know her mortgage payments but I know that this home was listed ten years ago at 320,000 when she got it, and that every home in the neighborhood is now selling for 650K on up, and one bedroom condos can be had for about 150,000.

Freedomin5

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #13 on: March 18, 2016, 07:13:56 AM »
Agree with all of the previous posters. You'll probably have ample opportunity to pay her back in the future. So instead of seeing it as "using" your mom and your having an "entitlement problem", maybe it's more like family helping family. You can (and likely do) contribute to her well-being in many different ways, such as preventing loneliness since she has her daughter and grandchildren nearby.

My sister (late 20s) still lives with my mom in her three-bedroom house rent-free, but my mom likes it that way because she isn't as lonely then. Besides, in her Asian mind, there's no point "wasting" money paying mortgage interest to the bank when she has plenty of room in her house. Not every culture considers it "mooching" when an adult child continues to live with parents.

My sister chips in by cleaning, cooking dinner when mom is working late, grocery shopping, running errands, buying groceries...there are lots of ways to be morally responsible and to contribute to the well-being of the entire family (including your mom's well-being) that may or may not involve money. If your mom is averse to you raising the rent, then perhaps you can contribute in other not-so-overtly-monetary ways?

charis

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #14 on: March 18, 2016, 07:19:38 AM »
I think you feel like renting from your mom for less than market value is somehow condoning her spending habits, which you see as problematic, because you are taking her help.  But they are not connected.  You probably also feel a little guilty for not being 100% able to afford living independently, paying down your debt, and saving as much as you are.   I understand the feeling.  You are FAR from the only person who accepts family help, in whatever way it comes.  My friends' wealthier parents fully pay for family trips and remodeled a room in their house as a gift.  Most people I know in my age group have free family babysitting/childcare to some extent, including me.  It's an amazing gift that helps keeps the family close and allows us to get our financial house in order.  You should do the same - pay off your debt, increase your savings rate, and then reassess whether she should sell.

Littlekind

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #15 on: March 18, 2016, 07:21:05 AM »
If your mom is averse to you raising the rent, then perhaps you can contribute in other not-so-overtly-monetary ways?

Great point. My husband is really good at this. He does all the lawn care, brings in her groceries, gets out of bed in the early morning to scrape snow off her car. She spends loads of time with my kids, but is not intrusive at all (and we don't treat her like an on-call sitter). The interpersonal aspects are great, except for feeling like we "should be" living in our own home, but I agree we need to set that feeling aside and be grateful. And yes, definitely make it up to her when she is older and needs us.

edit - Jezebel: exactly! That is exactly where I am coming from.
« Last Edit: March 18, 2016, 07:23:45 AM by Littlekind »

little_brown_dog

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #16 on: March 18, 2016, 07:23:24 AM »
Understand that there is more to bringing value to someone’s life than just paying them fair rent or letting them make bank off a home sale. You say she doesn’t want you to leave, and she won’t hear it about taking more cash. If she expresses this sentiment, trust what she says. She is obviously telling you she values having you there and not for monetary reasons. Many grandparents nowadays would love to live with their children and grandkids – it keeps them feeling like a real part of a family. Just because you leave, it won’t change the way she manages her finances, and then she’ll be missing you. If you like living there, and you both are getting something out of it (you – less expenses, her- more family involvement) why not just ride it out until the situation no longer works for one of you?

Don't worry about the should be feelings -  the idea of bailing on older people and leaving them to fend for themselves in their own homes without family is a new concept. We have lived in extended family units for most of human history. Multigenerational homes are still commonplace in many other countries. In many ways, moving away from your family is the radical/weird thing to do.
« Last Edit: March 18, 2016, 07:26:58 AM by little_brown_dog »

Retire-Canada

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #17 on: March 18, 2016, 07:26:43 AM »
Thank you Lizzzi, I meant to mention that - she honestly will just not take it. Even with the rent we're paying now, she is using part of it to pay down one of my student loans. I have mentioned that we should pay her more and she says she is going to put it toward my loans if we bother trying.

She is incredibly generous, to her own detriment.

Take whatever portion of the rent would be fair market above what she will accept and invest it in a separate account. This way when/if she runs into trouble later on you have some money ear marked to help her.

If she is in a solid financial position and generous that's her choice as an adult. However, if she is generous and will likely run into financial hardship before she dies then you'll need to be prepared to repay the generosity by looking after her.

It sounds like she is in the 2nd camp so I'd want to be prepared to help her out later.  You can't take advantage of her lack of foresight.

former player

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #18 on: March 18, 2016, 07:31:53 AM »
I agree with what others have said: what you are paying in rent plus the help and companionship you provide seems fair in a family context.

Two things which are not clear to me are 1) You sister is aware of the situation and is on board with it, and 2) there is nothing in your post which explains why you are having panic attacks over your mother's finances.  As long as she is keeping her head above water (ie she can pay expenses out of income) I don't think you should be panicking.   Not everyone is heading for mustachian levels of debt and expenses and consequent early retirement, and most non-mustachians manage fine one way or another.

Pigeon

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #19 on: March 18, 2016, 07:32:42 AM »
You are in no position to be buying a house now with all your debt.

Your mom likes the situation and it doesn't sound like she would rent the space out at FMV to strangers even if you left. It doesn't sound to me like you know she would be better off in senior housing. Around here, senior housing with good services is expensive and if she had the money from the sale of the house she would be paying the full rate. Plus, her spending habits might not change at all with all that cash from the sale burning a hole in her pocket.

I don't think you are taking advantage. You can also help by paying to fix things around the house as needed.

Littlekind

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #20 on: March 18, 2016, 07:44:16 AM »
I agree with what others have said: what you are paying in rent plus the help and companionship you provide seems fair in a family context.

Two things which are not clear to me are 1) You sister is aware of the situation and is on board with it, and 2) there is nothing in your post which explains why you are having panic attacks over your mother's finances.  As long as she is keeping her head above water (ie she can pay expenses out of income) I don't think you should be panicking.   Not everyone is heading for mustachian levels of debt and expenses and consequent early retirement, and most non-mustachians manage fine one way or another.

My sister and my mom are consumers to the max. My sister, for example, once offered to buy lunch because she thought she "might have $50 on her visa card" which I found out meant it was maybe 50 away from being maxed out. She makes more than me and my husband combined, has roommates to share expenses with, and still spends every cent she makes with no savings or retirement.  Her being on board with a financial plan is not a great endorsement.

My mom makes minimum payments on the mortgage - but I think she keeps up with her cards? -  and says she can't retire. She has a store card for every place she shops, I think. She definitely can pay her bills and is very giving but like retire-canada said, eventually I imagine she is going to be in a bind and then it will be my problem. But that's true whether we live with her now or not. I definitely assume my sister is not going to be any help when that situation comes up. I actually hadn't fully thought through how her spending might impact us later. On the other hand, I can't really talk to my mom about her debts because she is still a working and active adult, and it is not my business.

former player

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #21 on: March 18, 2016, 07:49:54 AM »
I agree with what others have said: what you are paying in rent plus the help and companionship you provide seems fair in a family context.

Two things which are not clear to me are 1) You sister is aware of the situation and is on board with it, and 2) there is nothing in your post which explains why you are having panic attacks over your mother's finances.  As long as she is keeping her head above water (ie she can pay expenses out of income) I don't think you should be panicking.   Not everyone is heading for mustachian levels of debt and expenses and consequent early retirement, and most non-mustachians manage fine one way or another.

My sister and my mom are consumers to the max. My sister, for example, once offered to buy lunch because she thought she "might have $50 on her visa card" which I found out meant it was maybe 50 away from being maxed out. She makes more than me and my husband combined, has roommates to share expenses with, and still spends every cent she makes with no savings or retirement.  Her being on board with a financial plan is not a great endorsement.

My mom makes minimum payments on the mortgage - but I think she keeps up with her cards? -  and says she can't retire. She has a store card for every place she shops, I think. She definitely can pay her bills and is very giving but like retire-canada said, eventually I imagine she is going to be in a bind and then it will be my problem. But that's true whether we live with her now or not. I definitely assume my sister is not going to be any help when that situation comes up. I actually hadn't fully thought through how her spending might impact us later. On the other hand, I can't really talk to my mom about her debts because she is still a working and active adult, and it is not my business.
OK.  I was concerned that you avoid any situation in which your sister thinks you are taking advantage or getting more from your mother than your fair share, but it doesn't sound as though that is an issue.  And as long as you mother is keeping up with her debt payments and has substantial equity in her house to fall back on, then she is doing OK.  You obviously have the much better attitude to finances.  I would keep in mind that if your mother's financial situation does go bad, for whatever reason, she might have to sell up quite quickly which would leave you finding another place at short notice, so having your own finances in order as you do is one less concern for you if that does happen.

Filliteracy

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #22 on: March 18, 2016, 09:18:43 AM »
Littlekind,

Not sure what country you are in, but 5% APR for a mortgage doesn't seem like a good idea to me at all in your current financial position... (also, is it 5% fixed or variable? if fixed, how many years? what kind of raises/income increase do you expect over the next few years?) I bought my first house in the summer of 2015 at 2.64% five year fixed - and interest rates have actually dropped lower since then so I know people that have renewed lower than 2.5%. 5% over a long-term debt like a mortgage sounds somewhat risky to me. I think that the more you are able/willing to put down for a downpayment, the less risky you appear as a buyer and the better interest rate you are able to obtain. Other factors including reducing your overall debt (destroy that 50K debt before it destroys you), and always paying your bills on time to increase your credit rating will also help.

Naturally, the advice you will get on this forum will go against the typical drone-minded consumer advice that you get from "culture and your friends". Whether you should buy a house or not isn't a function of your age or how often others who have no insight on your finances say you should. This is one of the top three expenses (along with food and transport) you have in your life - so consider yourself fortunate that you have the opportunity to shuttle out of your debt by having cheap rent.

If you permit peer/social pressures indulge you in poor financial decisions, be prepared to work forever as you attempt to dig yourself out of the interest hole.


Retire in CO

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #23 on: March 18, 2016, 09:50:57 AM »
This is your Mom's legacy. Many people have had a leg up from someone...in some way or another. For us, it was a loan from my father to start my husband's business. That investment, almost 30 years ago, was absolutely the best investment my father could have ever made. (I should sit down and try to calculate the ROI one day) And although he's been gone for many years, we and his grandchildren are still reaping the benefits.

It sounds like the family dynamic here is very healthy and your husband is a great help to your Mom. So, just be very frugal, get those student loans paid off and set your family on a stable path for the future. It will be the best gift you can give your Mom.

snacky

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #24 on: March 18, 2016, 10:19:46 AM »
in your shoes I would be grateful for the help (and pay her back in non-monetary ways whenever possible) and aggressively save up. When you have the money, buy the house from her. she can keep living there or move on, and she'll have the money to do so. it sounds like you like the area, so why not work towards doing for her what she has been doing for you? turnabout being fair play and all that.

Josiecat

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #25 on: March 18, 2016, 03:20:09 PM »
An idea.... perhaps you, your SO and your mom could attend Dave Ramsey's Financial Peace University together.  Then you can both learn together. 

Cassie

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #26 on: March 18, 2016, 03:30:54 PM »
Since your Mom would not rent out the apartment anyways I think you are fine.  If sounds like a great arrangement to me that is meeting everyone's needs.

ShoulderThingThatGoesUp

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #27 on: March 18, 2016, 06:16:08 PM »
Is part of the impetus for this post your husband not really wanting to live with your mom? Otherwise everything sounds reasonable and aboveboard.

Littlekind

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #28 on: March 18, 2016, 08:51:46 PM »
Is part of the impetus for this post your husband not really wanting to live with your mom? Otherwise everything sounds reasonable and aboveboard.

Yesssss that is a big factor. And they really love each other, and my husband is really frugal, but he is having this dilemma to a larger extent than I am. But then again when we have looked at homes and when we got preapproved for a mortgage, he definitely doesn't want to go through with commiting to those payments. Understandably.

Littlekind

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #29 on: March 18, 2016, 09:01:53 PM »
He wants to give it one more year here and save the 1000 per month instead of paying down the loan. Then we would have a better down payment and cushion. The loan we qualified for has no pmi if you put at least 3% down but the apr is 5% which isn't great.  Our credit scores were really good though. My husband would rather get a house, hold steady until our baby starts school, and get all of our debt beaten down once we're both working full time again. But again, even he doesn't really feel the time is right quite yet, but it's more important to him than to me.

ltt

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #30 on: March 18, 2016, 09:06:47 PM »
Listen, I have heard horror stories from a friend of mine who had renters.  I can't believe the amount of stuff her and her husband put up with and, personally, I could not be a landlord---ever.

With that in mind, you really are doing your mom a favor----even if it is "costing" her money.  I would do the same thing for any of my children.  There is a safety/knowledge issue here because your mom knows her renters (you and your husband).  It's okay, really it is--you don't have to feel bad.  And if she wants to sell after you purchase a home at some point, she can decide at that time.

ShoulderThingThatGoesUp

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #31 on: March 19, 2016, 08:30:57 AM »
So your real question is: why doesn't your husband like this arrangement? It sounds like you two agreed to another year during which you can figure out the best way to address his concerns. He might have valid emotional reasons this eats at him and the solution might be easier than a mortgage, too.

RedmondStash

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #32 on: March 19, 2016, 10:43:41 AM »
Take whatever portion of the rent would be fair market above what she will accept and invest it in a separate account. This way when/if she runs into trouble later on you have some money ear marked to help her.

This is an excellent idea. If she ends up needing the money, you'll have it. If she doesn't, your nest egg will be that much bigger.

I wouldn't even tell her you're doing it because it sounds like the idea might make her uncomfortable, and there's no need to burden her.

And if you're taking advantage of her (low rent), she is taking equal advantage of you (company, family, connection, help around the house), which cancels out. It sounds to me like it's actually a big win-win all around.

It is generally impossible in life to find an absolutely ideal, perfect situation. There's always something that could be better; everything involves compromises. You & your husband have to figure out what compromises and trade-offs make the most sense for your goals. But my biggest piece of advice is not to worry about what you feel you "should" be doing. By our cultural standards, you "should" be getting into lots of credit-card debt and chaining yourselves to 30-year jobs that will drain your souls.

You're already a rebel. Keep being one. Life the life that works best for you. I guarantee that ultimately, a lot of people will marvel that you are living such a great life, and they'll wonder how they can get there too.

SwordGuy

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #33 on: March 19, 2016, 11:21:33 AM »
Your mom likes having you live with her again.   I bet she would pay you to do it if she could.

My wife and I loved having our adult son move in with us for a few years while he got back on his feet.   We would love to have his whole family move in with us now!

It sounds to me like you're giving your mom the very best present you could give her.

So, stay and let her be happy, and save and invest that money.   If she ever needs it later, it will still be around to give to her then - plus earnings!

Tjat

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #34 on: March 19, 2016, 11:38:59 AM »
Two options I see

1. Buy the house from your mom and rent out the a portion of it.

2. Determine fair rent and put the difference from what your paying in a separate account. Perhaps you can use it for your mom when she is elderly.

WerKater

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #35 on: March 19, 2016, 01:40:25 PM »
If your mom is averse to you raising the rent, then perhaps you can contribute in other not-so-overtly-monetary ways?

Great point. My husband is really good at this. He does all the lawn care, brings in her groceries, gets out of bed in the early morning to scrape snow off her car. She spends loads of time with my kids, but is not intrusive at all (and we don't treat her like an on-call sitter). The interpersonal aspects are great, except for feeling like we "should be" living in our own home, but I agree we need to set that feeling aside and be grateful. And yes, definitely make it up to her when she is older and needs us.

edit - Jezebel: exactly! That is exactly where I am coming from.

It seems to me that you are overthinking this. Forget about all the money details for a moment. You are living with your mother because that arrangement has both practical and emotional advantages for her and for you. She seems to like it the way it is. So where is the problem?

When I grew up, we (my parents, my brother and I) were living together with my grandparents in the house that belonged to them [edit: the grandparents]. As far as I know, my parents never paid my grandparents one Euro of rent. Because the very idea would have been perceived as complete insanity. Naturally, when my grandparents got elderly, my parents repaid them by taking care of them. This is how a family works.

I am not saying you should not pay any rent. Our situation was different from yours because the house was already paid off. In your case it sounds as if your mother actually needs the rent. But she is happy with what you are paying. From what you are saying, I am sure she is very happy with your husband helping out and extremely happy about having her grandchildren around! Don't go destroying that really great situation just because of a vague feeling that you should pay fair market rent to your mother.

Tyson

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #36 on: March 19, 2016, 02:37:35 PM »
When I was younger I never wanted to accept help from my parents because I wanted to be independent.  Now that I'm older (and have a child), I see how stupid that was.  NOTHING makes a good parent happier than being able to help their children.  Getting to be near you and have you a constant part of her life is just icing on the cake.  Accept her generosity, and be grateful.

Also, I am in Denver too (best city in the world!).  If you are like me and love to do cultural stuff, bookmark this site, it's hugely helpful for doing tons of free activities around here - http://www.denver.org/events/free-denver-events/

dreams_and_discoveries

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Re: Moral Dilemma - building FI on the back of your parents
« Reply #37 on: March 20, 2016, 03:05:20 AM »
This sounds like a win-win situation for all parties.

Your mum gets to help you out, and see her grandkids regularly at no additional cost to herself. I guess she owns the place, and even though house values/rentals have gone up, her mortgage is the same? The why should she put the rent up, if her motivation isn't to make a profit?

You get a below market value place, close to a mum who is involved but not interfering, in an area you want to live.