I am 46 and single. I have a good job and own my own home but live modestly. I have been fortunate not to have had to ask my parents for anything over the years. My brother and sister, by contrast, have done so, and often. My parents are comfortable, but not wealthy.
My brother lives in New York City, and he is always in need of money. His finances are unstable, and he has a child and a high-maintenance wife. My sister is in an unstable marriage and often needs help. My parents have had to help them both substantially over the years.
I am concerned that my siblings see my parents as an endless source of money and that there will be nothing left. While I certainly do not feel averse to helping my brother and sister out in times of need, I feel that I am watching my inheritance evaporate before my eyes.
I am on good terms with them now, but I wonder what will happen when my parents pass.
An inheritance is only an inheritance when it lands in your bank account.
Let’s start with the good news. You are financially independent, you have your own home and you live within your means. You can also make sure you contribute to a retirement account such as a 401(k), automate your savings, try to avoid spending more than 30% of your income on housing, and allocate 20% of your income for your “wants” while putting 30% toward your financial goals.
There are also some other financial issues you can focus on, which should help take your mind off your siblings. Make sure you have an emergency fund with at least six months’ worth — or ideally, a full year’s worth — of expenses. Keep track of your monthly expenditures, and pay off your credit card every month. You never know when a recession, job loss or a medical expense could take a bite out of your finances.
Next, turn your attention to the stock market and the miracle of compound interest: That’s when you earn money on your initial investment — and money on your investment’s return. It takes time, but let’s assume that you, at age 46, have 20-plus years until your retirement. Investing now in a bearish stock market should reap long-term rewards.
You appear to be in a much stronger position than your brother and sister. You’re one of the lucky ones. The share of workers who say they are living paycheck to paycheck has surged among middle- and high-income earners — to 63% and 49%, respectively, up from 57% and 38% a year ago, according to this survey of almost 3,600 workers released last year.
The takeaway: Take care of your own finances and spend less time worrying about other people’s needs and wants. Your parents worked hard for their money, and their children’s financial fortunes vary. Yes, some of your siblings’ predicaments may be self-inflicted, but it’s up to your parents to decide whether or not they need help and how much to give.
You are always free to express your concerns to your parents, to ask them if they feel they’re being put under any undue pressure and to suggest that they take any money they give your siblings into account in their will. But don’t expect them to welcome that conversation. Let go of any preferred outcome. It’s their money, their kids, their decision.
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