My situation, which I think is pretty common, is this:
We’re ants but my spouse's father is a grasshopper. He’s already in his 60s, spends like crazy, and has TONS of debt. He has a decent income, but his spending is way above his income. He has done no retirement saving, he has burned all the way through a few hundred thousand dollars in inheritance money (won’t be passing *that* on to the next generation), and he has racked up tons of debt, and in the process gotten used to a lifestyle that is probably twice as expensive as he could have reasonably afforded on his actual income.
But it’s not like he gets in trouble once a year. He’s going to get in trouble all at once, and then we are either going to spend money to help or see an old man suffer.
I saw a great quote: If you jump off the top of an 80-story building, for 79 floors you can think you’re flying. It’s the sudden stop at the end that tells you you’re not. That’s the problem with our grasshopper. He thinks he’s flying. His expensive lifestyle feels like a sign of success to him, not a wealth-building failure.
Today it is still pretty easy to rack up debt. Banks will keep giving you credit cards. So when someone is still working, and has the capacity to borrow, they can live well above their means for years.
So the problem is, he will come to us for the first time when he’s in his 70s, unemployed, with no savings, and massively in debt. And it will be too late to “teach him how to fish.”
And, he will be surprised. One thing about grasshoppers–they don’t worry. They think everything is fine. So he won’t blame his past habits, he’ll blame the economy, or the banks who won’t give him more credit, or whatever.
Another thing about grasshoppers–they think money exists to be spent. The idea of a big pile of capital throwing off a modest annual income does not compute. If they suffer and they know you have a stock portfolio that you aren’t liquidating to help them, they’ll be mad.
Finally, there’s the whole old age factor. It will just seem more heartless not to help. To me it seems very unfair for us to have to effectively subsidize (after the fact) a lifetime of reckless spending that is the opposite of the way we try to live. But it will be too late to teach him a lesson he can learn from. And my spouse will hate to see him suffer in any way.
One other note–he’s never asked for money yet, and probably can’t imagine that he eventually will have to.
So, what do we do in this situation? Confronting him now will seem disrespectful. And it will likely have no impact. A) It’s hard to get people to change; B) He has a LOT of debt. It would take even dedicated ERE types more than a decade of hard, high-paid work to get through his debt.
But just waiting for him to report the financial “surprise” that we can easily see looming seems like a nightmare too. And stressful.
In the European bailout talks, Merkel from Germany made a good point: Liability and Control belong together.
But when it comes to spendthrift parents and in-laws, it’s hard to take control ahead of time but hard to fully sidestep the liability for elderly people you love, no matter how irresponsible they’ve been.
But the financial liability could be significant, could derail our plans for freedom, etc.
How to handle???