Good morning Dinks. I was chatting with one of my friends yesterday and she was very upset. Her parents are getting ready to retire and they are going to sell her childhood home. Unfortunately her parents didn’t save a lot during their working years so they are going to downsize and use the profits from the sale of the home to partly fund their retirement.
My friend is very upset that her parents are selling her childhood home. I am not sure she wasn’t expecting them to keep it forever, I just don’t think she was expecting them to sell it so soon. Or maybe she was expecting them to keep the home forever. Either way her extreme reaction brings up a lot of questions, both personal and financial.
Retirement should be in everyone’s goals.
As our parents get older they are getting ready to retire. But can all parents afford it? I know that families with kids have different financial priorities than a childless couple, but doesn’t everyone want to retire someday? Throughout our lives we can have several financial goals. For couples with kids this may include helping them through college and paying for their wedding. But does having kids mean you have to completely neglect your own personal financial goals?
I would say no, but maybe that’s because I am completely selfish. I don’t have kids because I like to do what I want when I want. I don’t want to change my daily routine or personal habits for kids, that’s why Nick and I don’t even have a dog. We live for us and that’s OK.
So my question is this…where does retirement fit in to a family budget? My Dad had a really great pension with his former employer that allowed him to retire at 55. He always says if he didn’t have forced savings (and matched savings) with his employer he never would have been able to retire because with a house and two kids there was no extra money for personal savings. This is just another benefit of being a childless couple…we can save for our own personal goals instead of saving for someone else’s goals.
When should kids let go of their parent’s retirement lifestyle?
The second question that comes up with my friend’s parents selling their home is her emotional attachment. Maybe it’s because I am from a family of divorce and neither one of my parents live in my childhood home, but I just don’t see the emotional attachment.
This is what her parents have to do to retire and she should be supportive. If they saved for retirement maybe she wouldn’t have been able to go to college. feel if my friend really doesn’t want to let go of her childhood home then she should make an offer to buy the home. She expected to spend many more holidays sitting around her parents dining room table, but come this Thanksgiving she will have to start new traditions.
I admit that neither one of my parent’s houses feel like home to me. But I don’t think that has anything to do with the actual dwelling. It has to do with the fact my family broke apart and my parents found happiness with other people. Well my Dad’s happiness is to be determined, but you get the point.
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Kristina Tahnyak
Tahnya is a Certified Financial Planner and former Investment Advisor turned marketing and communications professional She holds a degree from Concordia University, is debt free and currently works in the field of digital marketing.
I actually didn’t want kids, my wife hit 30, and she decided she wanted one. We now have an 18 month old daughter, and surprisingly, I’m happy with the results (so far). There are many financial falsehoods perpetuated by websites, blogs and financial gurus.
Yes, we do give up some freedom, but as my daughter gets older, we gain some of that freedom back. Also, (and I think the applies more to the FI crowd), we enjoy letting our daughter really explore and learn on her own (ie: trial by fire). Rather than protect our daughter from every bump and bruise, we encourage her to fall down and learn from the experience.
Similarly, I have found that many parents feel they need to spend all this money on their kids for some reason. My wife and I have found that we are actually saving and investing more now, with our daughter around, than we were before she arrived. We may be in the minority, but I am still driving to retire by 35, in a not-dissimilar way to Mr. Money Mustache. Our retirement will consist of real estate, dividend paying stocks and small, local businesses. Having a kid has not affected my retirement plans at all (note: we are not planning on paying for college or a wedding, but have plans to include our daughter in one of our businesses when she turns 18; she can then choose to do what she wishes with the money from the business).
I’m pretty unemotional about childhood homes etc. When my husband and I sold the house we built and raised our son in, I think our son was a little surprised but he didn’t express opposition. After all, he has relocated to a place two states away, married and bought his own home. My mom, unlike me, is very sentimental about her home. I do think some people are irresponsible by not saving early for retirement, but there probably isn’t much we can do about it. Wouldn’t it be nice if everyone were responsible without being forced?
Some people can get so attached to many things especially if there are a lot of sentimental values involved. But then, people will have to accept that change can happen in many ways and often, it is inevitable. Perhaps your friend wasn’t that ready for something that is seemingly a big change for her even if it has to do with her parents’ retirement plans.
We lived in 4 different homes while I was growing up, so when my parents sold the last one and moved away I didn’t see that as that big of an issue, instead of having one large shock, I had experienced moving away from my childhood home(s) in phases. As far as saving for retirement with kids, It is more difficult to find a balance, especially if you have kids early and don’t earn a large income, but it is doable. I also don’t think I would have been as discipled to save and be cognizant of my money as much if I didn’t have children. Having other people that depend on me and who I need to teach, helps motivate me to do better.
Some individuals can get so connected to many things especially if there are a lot of expressive principles engaged. But then, individuals will have to agree to that modify can occur often and often, it is unavoidable.
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