helping them buy a home

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:DH and I want to help DS to purchase his first townhouse, around 1M, but we want DS to have skin in the game. DS has lived at home with us for three years and saved up 95% of his annual salary, after taxes, for the past three years with about 240K in his account. When he officially moved out two months ago, we gave him 600K for his 1M home purchase down payment. IMHO, that is the right approach.

Are you a troll? No one needs a million dollar house as their first home.

Of course no body needs that. but the kid could likely easily afford a 600-700K home on their own--put 200K down and take a 500K mortgage. If the parents have the money and the kid is responsible (they have literally saved 95% of their salary for 3 years and lived at home---no 22 yo wants to live at home really), so why make them start with a "starter home" if this is where they want to settle down.

I'm assuming that he was able to save 95% of salary because the parents had bought him a car and paid for his cell phone coverage also.

[Anonymous]

Anonymous wrote:I am envious, although not resentful, of people whose parents (are able to, and) choose to do this for their kids. Talk about a leg up!

I'm an immigrant with exactly $100 bill (cliche, I know). I still don't have as much as I should by now because opening an investment account took forever (10-12 years). Now that it is finally opened, it's growing significantly. I will never know why people are not doing it for their children. It doesn't take much sacrifice. A little bit of money, knowledge, discipline, time.
Ofcourse emergencies can wipe it all out, but that's not the reason most people are not doing it. The reason is not even minimum wage and over-shopping. The reason is simply not knowing how it's done.
Both my kids have over 6-figure accounts growing.
I could do it again if all the money disappeared tomorrow. I got to have the know-how and no, it's not hard at all.
So, tell me why you are not doing it for those who are not?

[Anonymous]

We helped. No big deal.

[Anonymous]

Anonymous wrote:I think it will be exceedingly difficult for my kids, now in their 20s, to buy a first home without help. We'll be able to help, and plan to, when the time comes. Why should they wait till we die for money to be passed down if it can be put to use now? This "I pulled myself up by my bootstraps by brown-bagging it -- they will, too" attitude only goes so far when housing prices are this insane, yet I hear those kinds of comments frequently. To me it's delusional. Has anyone's young adult bought a house in the past year? Did you help?

My kid is in HS but we've already had this discussion. It's going to be so, SO difficult for these kids -esp if they carry any student loan (mine likely will for grad school) to buy homes. We'll help as much as we can for sure.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:DH and I want to help DS to purchase his first townhouse, around 1M, but we want DS to have skin in the game. DS has lived at home with us for three years and saved up 95% of his annual salary, after taxes, for the past three years with about 240K in his account. When he officially moved out two months ago, we gave him 600K for his 1M home purchase down payment. IMHO, that is the right approach.

Are you a troll? No one needs a million dollar house as their first home.

In the end the children know deep inside they never did anything on their own and know they are weak lightweights.

I hope those kids buy one and enjoy the benefit of it. And without a moment's shame.

Lots of rich people get their "seed money" from family. Nepotism. And if my kid, your kid, any kid can . . . so what. It's not about "need."

[Anonymous]

How much money are people giving relative to their net worth? I'd do it if we had $10m or more, but we're not there yet. We did pay for 100% of education costs so they get to start out with no debt.

[Anonymous]

Anonymous wrote:At what age do you stop wiping their nose and their butt? And when they experience a rough day at work, do you march into their office and yell at their boss?

For one, it stops when I say so. Not when you do. So MYOB you jealous hag.

No. 2, you think b/c I will help financially that they don't experience "rough days", bad days, or disappointments? Maybe that simple-minded thinking works for some people but most realize nuance. Most realize you can have both. Most realize you can still be a functioning adult and cope with adversity.

You already know this though and are just so jealous you can't think or see straight.

[Anonymous]

Anonymous wrote:My kids are no where near being ready to buy but we've given them money to invest along with money they got from a great grandmother. It's not a huge amount (they probably have about $25K at this point) but by the time they are ready to buy it will hopefully be enough for or at least help with a down payment. Kids are 20, 18 and 14. The 14 year old was not alive when great grandmother died so he has considerably less, but we will make up for it.

I appreciate that you are mindful about anteing up with your 14 y.o. That's the kind of stuff that can cause conflict between/among siblings over time.

[Anonymous]

Anonymous wrote:How much money are people giving relative to their net worth? I'd do it if we had $10m or more, but we're not there yet. We did pay for 100% of education costs so they get to start out with no debt.

My ILs vastly underestimated what they would need in retirement - they spent a lot on winter rentals in FL (25 years) and expensive trips (10 years) and do not really have any margins now. I don't want to do that to my kids.

[Anonymous]

At retirement our NW will be 7 million, we plan to pay for college, weddings, cars and 500k down payment each.

We will be receiving a 7k pension +SS+5k monthly distribution from 401k. Rest of our inheritance will also go to our kids. We are not big spenders or travelers so we plan to lead a quiet life in retirement.

People with 10 mil+ are a different category and then should definitely help their kids, times are tough.

[Anonymous]

Anonymous wrote:At retirement our NW will be 7 million, we plan to pay for college, weddings, cars and 500k down payment each.

We will be receiving a 7k pension +SS+5k monthly distribution from 401k. Rest of our inheritance will also go to our kids. We are not big spenders or travelers so we plan to lead a quiet life in retirement.

People with 10 mil+ are a different category and then should definitely help their kids, times are tough.

Our NW is around $7m and we don't feel like it's prudent for us to give our kids that amount of money for a down payment. We covered their education, but our retirement and long-term care needs could eat up our savings, especially since people are living longer than ever and both sides of our family have long lifespans. We also probably have more kids than PP. In any case, we're saving it and leaving them money when we pass.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I am envious, although not resentful, of people whose parents (are able to, and) choose to do this for their kids. Talk about a leg up!

I'm an immigrant with exactly $100 bill (cliche, I know). I still don't have as much as I should by now because opening an investment account took forever (10-12 years). Now that it is finally opened, it's growing significantly. I will never know why people are not doing it for their children. It doesn't take much sacrifice. A little bit of money, knowledge, discipline, time.
Ofcourse emergencies can wipe it all out, but that's not the reason most people are not doing it. The reason is not even minimum wage and over-shopping. The reason is simply not knowing how it's done.
Both my kids have over 6-figure accounts growing.
I could do it again if all the money disappeared tomorrow. I got to have the know-how and no, it's not hard at all.
So, tell me why you are not doing it for those who are not?

How? From a financially illiterate person, I would love some advice

[Anonymous]

Anonymous wrote:

Anonymous wrote:How much money are people giving relative to their net worth? I'd do it if we had $10m or more, but we're not there yet. We did pay for 100% of education costs so they get to start out with no debt.

My ILs vastly underestimated what they would need in retirement - they spent a lot on winter rentals in FL (25 years) and expensive trips (10 years) and do not really have any margins now. I don't want to do that to my kids.

Obviously, you don't give your adult kids money for major purchases until you have completely set up your own future/retirement without any doubts (ie. fully planned for many years in a home or memory care/assisted living/etc).
But as the PP stated, once you hit $10M you can consider it. Once you hit $20M it's a no-brainer---you likely are not spending all of that, so giving your kids $100-400K for a home is a much better use of $$ than them getting it when they are 50+.

[Anonymous]

At the time we stopped saving for college, we opened accounts for our children and gifted the max allowed by the irs. Each child has the ability to do with the money as they see fit. Grad school or a house. I assume they will all use it for school and then what is left will go to a home. I don’t see any of them wanting a $1m home as their first home nor do I see any of them wanting to go past a graduate degree.

[Anonymous]

How old are you? When do you plan to retire.
You want to make sure you do save enough so when you don't have to work, you have money to support yourself. Whether it's insurances, medical, travel, old people home and funeral. If you are able to anticipate these expenses, your children will not be burdened by it. You pretty much have to over estimate how much you would need in the remaining future with inflation and all. If you have a million dollars now, I don't think it is enough.