Can I afford a 1.8M house?

[Anonymous]

Anonymous wrote:I’m going to disagree with PPs. OP is not “loaded” and taking in a 7k/mo mortgage, even with the mother’s contribution (it’s not really rent, it’s wealth transfer assigned as rent, and I’m actually not even sure calling it rent us the most tax advantageous plan, but anyway).

You are dual income. I don’t know how stable your jobs are or what percent of your incomes is a variable bonus, but I would be wary of taking on a mortgage you need both incomes to afford. There are lots of things that can come up with three kids, aging parents, and even your own health as you enter middle age. If one of you lost your job, had to go without your bonus, had to take a leave of absence, you will be looking at dipping into savings or having to make some tough choices around your kids schooling. You don’t want to be in that position.

I would look to limit your housing costs to something you could reasonably afford on one salary with about half your mom’s contribution. That will give you far more financial flexibility. At 40, you nay be stepping up in income sometime this decade, in which case you could feasibly upgrade. But at your current HHI I would not go up to a 7k mortgage yet.

Disagree, her parents will bail them out and help pay mortgage if they have such unforeseen problems arise.

[Anonymous]

Vomit. Sure you can because instead of paving your own way you're still relying on your parents.

[Anonymous]

Anonymous wrote:Vomit. Sure you can because instead of paving your own way you're still relying on your parents.

This is the DC way though.

[Anonymous]

Don’t have her pay $2k a month. You don’t want to have pay taxes on the “rent”. Just have her give you each up to the annual gift tax exclusion.

[Anonymous]

Anonymous wrote:People all butt hurt about their mom contributing 2k but how is that any different than your parents gifting you the 15k annual exclusion, paying for grandkids college or private school, or ultimately inheriting their money when they die.

I don’t get why people frown on parents choosing to provide their adult children with money while they can enjoy. I would much rather be given money no while I’m raising a family than inherit millions when I’m already retired (assuming parents live into their 80s).

Total aside but I feel compelled to respond to this absurd comment.

I’m sure this is not any different than all of the other wealth transfer mechanisms you listed, but 1) MOST people do not receive ANY of those things, and 2) it is disgusting to me because until recently I was still laboring under the delusion that we are living in a meritocracy.

We need SERIOUS tax reform in this country. It should not be possible in the land of opportunity for this obscene family wealth hoarding to occur. If parents want to give their adult children tons of money fine, but those adult children should pay at least as high if not higher tax rate than us poor serfs who actually go out and EARN our money.

[Anonymous]

Anonymous wrote:

Anonymous wrote:People all butt hurt about their mom contributing 2k but how is that any different than your parents gifting you the 15k annual exclusion, paying for grandkids college or private school, or ultimately inheriting their money when they die.

I don’t get why people frown on parents choosing to provide their adult children with money while they can enjoy. I would much rather be given money no while I’m raising a family than inherit millions when I’m already retired (assuming parents live into their 80s).

Total aside but I feel compelled to respond to this absurd comment.

I’m sure this is not any different than all of the other wealth transfer mechanisms you listed, but 1) MOST people do not receive ANY of those things, and 2) it is disgusting to me because until recently I was still laboring under the delusion that we are living in a meritocracy.

We need SERIOUS tax reform in this country. It should not be possible in the land of opportunity for this obscene family wealth hoarding to occur. If parents want to give their adult children tons of money fine, but those adult children should pay at least as high if not higher tax rate than us poor serfs who actually go out and EARN our money.

You must be the only person who still thinks we live in a meritocracy.

[Anonymous]

Anonymous wrote:

Anonymous wrote:People all butt hurt about their mom contributing 2k but how is that any different than your parents gifting you the 15k annual exclusion, paying for grandkids college or private school, or ultimately inheriting their money when they die.

I don’t get why people frown on parents choosing to provide their adult children with money while they can enjoy. I would much rather be given money no while I’m raising a family than inherit millions when I’m already retired (assuming parents live into their 80s).

Total aside but I feel compelled to respond to this absurd comment.

I’m sure this is not any different than all of the other wealth transfer mechanisms you listed, but 1) MOST people do not receive ANY of those things, and 2) it is disgusting to me because until recently I was still laboring under the delusion that we are living in a meritocracy.

We need SERIOUS tax reform in this country. It should not be possible in the land of opportunity for this obscene family wealth hoarding to occur. If parents want to give their adult children tons of money fine, but those adult children should pay at least as high if not higher tax rate than us poor serfs who actually go out and EARN our money.

Your logic scares me. What gives you the right (entitlement) to someone else’s money? If my grandparents, parents or whoever, EARNED wealth, paid taxes on those assets, and planned according to current tax laws, what gives you the right to feel that these assets should be taxed even more. My grandparents
Were dirt poor, built a business and accumulated significant wealth through the good old American dream. So they pay for my college or kids college, help
With down payment..How is that not fair?

Stop being jealous and earn your wealth. If you want to give your kids 15k a year each, good for you! If you want to donate it to Uncle Sam, please be my guest.

[Anonymous]

Yes, you can afford the house, and good for you for taking care of your mother as she ages.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:People all butt hurt about their mom contributing 2k but how is that any different than your parents gifting you the 15k annual exclusion, paying for grandkids college or private school, or ultimately inheriting their money when they die.

I don’t get why people frown on parents choosing to provide their adult children with money while they can enjoy. I would much rather be given money no while I’m raising a family than inherit millions when I’m already retired (assuming parents live into their 80s).

Total aside but I feel compelled to respond to this absurd comment.

I’m sure this is not any different than all of the other wealth transfer mechanisms you listed, but 1) MOST people do not receive ANY of those things, and 2) it is disgusting to me because until recently I was still laboring under the delusion that we are living in a meritocracy.

We need SERIOUS tax reform in this country. It should not be possible in the land of opportunity for this obscene family wealth hoarding to occur. If parents want to give their adult children tons of money fine, but those adult children should pay at least as high if not higher tax rate than us poor serfs who actually go out and EARN our money.

Your logic scares me. What gives you the right (entitlement) to someone else’s money? If my grandparents, parents or whoever, EARNED wealth, paid taxes on those assets, and planned according to current tax laws, what gives you the right to feel that these assets should be taxed even more. My grandparents
Were dirt poor, built a business and accumulated significant wealth through the good old American dream. So they pay for my college or kids college, help
With down payment..How is that not fair?

Stop being jealous and earn your wealth. If you want to give your kids 15k a year each, good for you! If you want to donate it to Uncle Sam, please be my guest.

DP, but lol at “scares me”.

Even setting egalitarianism aside for a moment, what you describe is an incredibly inefficient use of resources. Wealth hoarding hurts all of society by limiting education and advancement opportunities for the vast majority of people so that the very wealthy can feel marginally more secure or comfortable. OP is basically debating between a 1.3m house and a 1.8m house. Her children’s (fully private) education is paid for. She has an enormous safety net in her savings. And you are upset about the idea that she might be made to pay taxes on massive lump sums of cash from her mom? It “scares” you? Does it also scare you that those taxes could be used to pay for other people’s kids to get educations and become functional, contributing members of society who ALSO pay taxes? Is that terrifying? A functional, interdependent society in which we all benefit from one another’s success and have a vested interest in helping one another? That frightens you?

I personally am more afraid of the current system where a small percentage of the population sits on giant piles of cash and watches the rest of the world burn.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:People all butt hurt about their mom contributing 2k but how is that any different than your parents gifting you the 15k annual exclusion, paying for grandkids college or private school, or ultimately inheriting their money when they die.

I don’t get why people frown on parents choosing to provide their adult children with money while they can enjoy. I would much rather be given money no while I’m raising a family than inherit millions when I’m already retired (assuming parents live into their 80s).

Total aside but I feel compelled to respond to this absurd comment.

I’m sure this is not any different than all of the other wealth transfer mechanisms you listed, but 1) MOST people do not receive ANY of those things, and 2) it is disgusting to me because until recently I was still laboring under the delusion that we are living in a meritocracy.

We need SERIOUS tax reform in this country. It should not be possible in the land of opportunity for this obscene family wealth hoarding to occur. If parents want to give their adult children tons of money fine, but those adult children should pay at least as high if not higher tax rate than us poor serfs who actually go out and EARN our money.

Your logic scares me. What gives you the right (entitlement) to someone else’s money? If my grandparents, parents or whoever, EARNED wealth, paid taxes on those assets, and planned according to current tax laws, what gives you the right to feel that these assets should be taxed even more. My grandparents
Were dirt poor, built a business and accumulated significant wealth through the good old American dream. So they pay for my college or kids college, help
With down payment..How is that not fair?

Stop being jealous and earn your wealth. If you want to give your kids 15k a year each, good for you! If you want to donate it to Uncle Sam, please be my guest.

The PP is not suggesting a sua sponte tax on assets. She is saying that any time there is a significant transfer of wealth, it should be taxes. Most transfers *are* taxed - your paycheck is taxed as income, if you buy something, the amount you pay is taxed as income to the retailer or service provider. But for some reason, we as a society have decided against taxing the vast majority of intra-family wealth transfers - inheritance and gifts. She is simply arguing that we eliminate that exception.

As you said, your parents planned according to current tax laws. But those are, and always have been, subject to change. There's nothing nefarious suggested here.

And your admonition to "earn your own wealth" is so idiotic it's almost difficult to describe. At the end of a long screed where you argue for your right to money *you* did not earn free of any taxes, you tell someone else to earn their own money? The lack of self-awareness is stunning.

[Anonymous]

Anonymous wrote:Yes, you can afford the house, and good for you for taking care of your mother as she ages.

This. I don’t get all the people piling up on OP when half the people here get cash gifts from their parents every year, not to mention live off their trust funds or have had some other family help in the form of down payment or fully funded 529’s.

It appears the word “rent” is particularly triggering for some. You should have used the word “gift” instead. I’m guessing that OP is not white.

[Anonymous]

Anonymous wrote:Don’t have her pay $2k a month. You don’t want to have pay taxes on the “rent”. Just have her give you each up to the annual gift tax exclusion.

Actually the best way is for mom to directly pay the school 24k for tuition. No gift tax and no tax on rent income. Other ways would include directly paying for some household expenses.

[Anonymous]

So what’s better for society?

Wealthy person A donates $50M to establish a school for underrepresented minorities to learn STEM, internships, etc OR paying $50M in estate taxes.

You can’t possibly imagine the government will be more efficient with those funds.

I agree there should be some estate tax, but the problem with society isn’t the families with 10-100m, it’s the families with tens of billions of more.

I would argue it’s more efficient for the government to incentivize charitable giving more than they currently do from a tax/estate plan. Congress is inept, thanks to Trump, its only gotten worse.

[Anonymous]

Anonymous wrote:So what’s better for society?

Wealthy person A donates $50M to establish a school for underrepresented minorities to learn STEM, internships, etc OR paying $50M in estate taxes.

You can’t possibly imagine the government will be more efficient with those funds.

I agree there should be some estate tax, but the problem with society isn’t the families with 10-100m, it’s the families with tens of billions of more.

I would argue it’s more efficient for the government to incentivize charitable giving more than they currently do from a tax/estate plan. Congress is inept, thanks to Trump, its only gotten worse.

That's quite a tangent. Whether charitable giving is more efficient than the estate tax is not the issue here. The issue is whether sixeable estates estates should be able to be passed from parents to children without any taxes. And contrary to your suggestion, estates of $1-$10m *are sizeable.

[Anonymous]

Well that is the issue.

You’re arguing for more estate tax, I’m arguing to provide more
Incentives for the wealthy to donate heir wealth vs uncle taking it in the form of estate tax.

If they don’t want to be charitable then sure, tax em. Without the wealthy, many of the greatest social joys we love participating in - museums, education, etc would not function.

Dave Rubenstein is a great example of what I’m in favor of. A man who started a business, worth billions and gives back significantly to his local community (and the country for that matter). Dave r is hardly the problem in society.