Anonymous
Post 10/31/2024 20:35     Subject: When do you tell kids about family money?
Anonymous wrote:I wonder how people get so wealthy. I'm an immigrant and came to this country on my own with no money, dh comes from no money. I'd say we do well, in the sense we never have to worry about having money to pay for what we need, we have savings, we invest...But I don't see us ever getting to the levels described here.


Wealth requires time and discipline. The quote, "Compound interest is the eighth wonder of the world. He who understands it, earns it. He who doesn't, pays it," is often attributed to Albert Einstein. it means that money grows over time. The more money you can put to work, and the longer you have within which it can grow, the wealthier you'll be at the end of the day.

You have to live well below your means, with the money not spent working for you in prudent investments likely to outpace inflation with an acceptable level of volatility over many years. Over time, your investments, and your wealth, will grow. The more $ you put to work the more you'll have later on. Patience is key. Start early, reap the rewards in retirement. The more you can invest, the bigger the rewards. So earning more and spending less accelerates the process.
Anonymous
Post 10/31/2024 19:16     Subject: When do you tell kids about family money?
Anonymous wrote:I wonder how people get so wealthy. I'm an immigrant and came to this country on my own with no money, dh comes from no money. I'd say we do well, in the sense we never have to worry about having money to pay for what we need, we have savings, we invest...But I don't see us ever getting to the levels described here.


Many get there by working at companies where part of your pay is Stock options. It's even more productive if you work for a startup company/private small company---in return for a much lower salary, you have the promise of stock options. Sometimes, it works out. Othertimes it doesn't. But those start up companies often mean working extremely long hours (70-80 hour weeks), not bonuses (where a stable tech job would provide that and only a 40-50 hour week), and not knowing when you could simply be out of a job because they are out of money.
In return, if you manage to stick with one and they go public, you can finally sell your options.

Some do it as high powered lawyers or finance.

Anonymous
Post 10/31/2024 19:12     Subject: When do you tell kids about family money?
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:I would increase your charity giving considerably. You are hoarding wealth.


You literally have NO CLUE how much they are giving to charities


If their children will have 2 trust funds of $2-6M each, it’s not enough.


That is your opinion but not fact.



It is a fact. They are hoarding wealth. It might make you uncomfortable, but it is a fact.


Well you are entitled to your opinion. But it's not "fact". Giving your kids $4M each if you have gifted $20M+ is quite generous. Despite what you want to think, their parents earned that money and thankfully once we pay taxes, we don't have to give away all of the rest of our money. And yes, most of us with $20M paid income taxes on all of it, maybe LT Cap Gains (at both federal and state level) as a "best scenario". So they have paid 26-47% on that CG/Income. They have given already to society via taxes.

So unless you are living in a communal home (like a nun or priest) and giving everything of yours back, perhaps you can start giving "your extra wealth" that you are hording---because you can live in a 1 bedroom apartment in the worst area of DC, other people do that so you should too.
Anonymous
Post 10/31/2024 19:07     Subject: When do you tell kids about family money?
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:I have to laugh at the posters who keep talking about millions of dollars not being a lot of money. So insecure. All of you.


Well $2M is not lifechanging in that you can quit your job or take a job you love for only $45K/year. It is enough to know that you can jump start your retirement and kid's college funds and not have to worry much about those.



I could make two million last forever in addition to my current home, resources...You have to spend the money well, or decide where not to spend it (that includes 80k/year college...don't do it if the goal is healthiest finances possible)


Obviously you "could" live on it. But that is not how many of us would choose. I'd prefer my 30 or 35 yo kid doesn't just quit their job because they get $2M. I'd rather that $2m go to supplement life. Allow them to go PT or on spouse to go PT (if they want) with the kids (or not). Allow them to live closer to their jobs, so more family time (less commuting), etc.

But $2M will also allow you to be set for college (I disagree---if you are set for retirement and can save/afford the $90K school we will spend/did spend it). And have a great start for their own retirements
Anonymous
Post 10/31/2024 17:20     Subject: When do you tell kids about family money?
Anonymous wrote:I wonder how people get so wealthy. I'm an immigrant and came to this country on my own with no money, dh comes from no money. I'd say we do well, in the sense we never have to worry about having money to pay for what we need, we have savings, we invest...But I don't see us ever getting to the levels described here.

Corporate law
Surgeon
Start a successful company
Own a car dealership
Start a successful hedge fund
Anonymous
Post 10/31/2024 17:05     Subject: When do you tell kids about family money?
I wonder how people get so wealthy. I'm an immigrant and came to this country on my own with no money, dh comes from no money. I'd say we do well, in the sense we never have to worry about having money to pay for what we need, we have savings, we invest...But I don't see us ever getting to the levels described here.
Anonymous
Post 10/31/2024 17:01     Subject: When do you tell kids about family money?
Anonymous wrote:So much hoarding. Does no one ever spend a dime on things that bring joy or do you all just hoard so the next generation can hoard [/quot

We do both! We spend far more in retirement than we did before and at the same time we’ve put a lot away for our children, grandchildren and charity. We have a lot of grandchildren and the total in their 529’s is likely $1.5 million and the oldest is only 12. We are generous with annual gifts to our children and their spouses. All of those gifts and charitable contributions do bring joy to us as well. We don’t spend much on clothes and cars because they are not important to us but our travel and club expenses often get ridiculous.
Anonymous
Post 10/31/2024 16:40     Subject: When do you tell kids about family money?
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:I would increase your charity giving considerably. You are hoarding wealth.


You literally have NO CLUE how much they are giving to charities


If their children will have 2 trust funds of $2-6M each, it’s not enough.


That is your opinion but not fact.



It is a fact. They are hoarding wealth. It might make you uncomfortable, but it is a fact.


You say that like it's a bad thing for people to ensure their own financial security so they needn't ever depend on the largesse of the government. Or, do you mean that wealth invested is somehow unproductive and doesn't contribute to economic growth, which in turn provides for the employment of others, the payment of taxes, etc?
Anonymous
Post 10/31/2024 15:27     Subject: When do you tell kids about family money?
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:I would increase your charity giving considerably. You are hoarding wealth.


You literally have NO CLUE how much they are giving to charities


If their children will have 2 trust funds of $2-6M each, it’s not enough.


That is your opinion but not fact.



It is a fact. They are hoarding wealth. It might make you uncomfortable, but it is a fact.
Anonymous
Post 10/31/2024 15:17     Subject: When do you tell kids about family money?
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:So much hoarding. Does no one ever spend a dime on things that bring joy or do you all just hoard so the next generation can hoard


We spend plenty on "things that bring joy".

Own two homes, both worth $3M+ and both recently renovated (dont even ask how much that was), own 3 cars--most recent cost $95K, mostly travel Business class now and take 6-7 trips each year (most recent was 16 hour flight in business class---so about $8K roundtrip), gift the kids each $38K/year, also bought the recent college grad a new $40K vehicle, have about 1K bottles of wine and growing (yes we drink it, we also like adding more as we travel and explore) and the list goes on and on. Will spend even more once we are retired (in a year or so).

Still will be leaving $5-10M for each kid possibly more (or giving the "more" away to more charities)


Thanks for answering this OP; I was wondering the same thing. I recently projected how much we will be worth at retirement (plus what we will inherit) and realized we should consider spending more NOW. This is a great answer.

As for how to talk to your kids.... based on your answer here, I think they know. My parents started talking about it when they retired, so you could do the same. Just know, it wasn't a surprise how much money they had even though they were very frugal my whole life.


My kids are 21 and 25---yes they know. They always knew we didn't have money concerns, but didn't know the level until recently (when a company sale took us to a new level and more willing/able to spend more freely). Now they know the amounts, know they will always have a fall back, know housing downpayment and their kid's college (no long term SO yet but when it happens) will be paid for. They also know they will continue to get money now, not just when we die. Because the impacts are much greater in their 20s/30s.
The one out of college maxes their Roth and 401K, the other will once they graduate. By time they are 30/35, they could stop investing and would be just fine for retirement (even without our windfall), because they will have enough to equal $5-6M+easily if they leave it in the market.
They knew we used to be more frugal--they never wanted for anything, but knew we were not splurging on a luxury vehicle or sports car for them...they got Hondas to drive at 16. They also know that while we (the parents) now fly business class 99% of the time, the kids only get it if price is right (or it's a red eye or very early AM flight). If they want that, they have to work for it. Thankfully both are still very financially sound and prefer to save over just spending.

Anonymous
Post 10/31/2024 15:14     Subject: When do you tell kids about family money?
Anonymous wrote:
Anonymous wrote:I have to laugh at the posters who keep talking about millions of dollars not being a lot of money. So insecure. All of you.


Well $2M is not lifechanging in that you can quit your job or take a job you love for only $45K/year. It is enough to know that you can jump start your retirement and kid's college funds and not have to worry much about those.



I could make two million last forever in addition to my current home, resources...You have to spend the money well, or decide where not to spend it (that includes 80k/year college...don't do it if the goal is healthiest finances possible)
Anonymous
Post 10/31/2024 15:11     Subject: When do you tell kids about family money?
Anonymous wrote:I have to laugh at the posters who keep talking about millions of dollars not being a lot of money. So insecure. All of you.


Well $2M is not lifechanging in that you can quit your job or take a job you love for only $45K/year. It is enough to know that you can jump start your retirement and kid's college funds and not have to worry much about those.

Anonymous
Post 10/31/2024 15:09     Subject: When do you tell kids about family money?
Anonymous wrote:My in-laws sold their business in the late 90s for a boatload of money and my spouse was 27 at the time. Both parents are still alive. We have no clue what their net worth is but if they made reasonable investments it should have increased many times over during the last 25 years. From day one, we decided to assume that we would not see a dime. We have created a substantial nest egg of our own. With our daughter, we have tried to instill the same lessons.


And your IL have not offered to at least help with college for the grandkids?!?!? It sounds like they made 10M+. Plenty to at least jumpstart a 529 for each grandkid (considering if you put $100K in when the kid is born and let it grow, there is in-state and much more at 18/20)
Anonymous
Post 10/31/2024 14:56     Subject: When do you tell kids about family money?
Anonymous wrote:
Anonymous wrote:So much hoarding. Does no one ever spend a dime on things that bring joy or do you all just hoard so the next generation can hoard


We spend plenty on "things that bring joy".

Own two homes, both worth $3M+ and both recently renovated (dont even ask how much that was), own 3 cars--most recent cost $95K, mostly travel Business class now and take 6-7 trips each year (most recent was 16 hour flight in business class---so about $8K roundtrip), gift the kids each $38K/year, also bought the recent college grad a new $40K vehicle, have about 1K bottles of wine and growing (yes we drink it, we also like adding more as we travel and explore) and the list goes on and on. Will spend even more once we are retired (in a year or so).

Still will be leaving $5-10M for each kid possibly more (or giving the "more" away to more charities)


Thanks for answering this OP; I was wondering the same thing. I recently projected how much we will be worth at retirement (plus what we will inherit) and realized we should consider spending more NOW. This is a great answer.

As for how to talk to your kids.... based on your answer here, I think they know. My parents started talking about it when they retired, so you could do the same. Just know, it wasn't a surprise how much money they had even though they were very frugal my whole life.
Anonymous
Post 10/31/2024 14:03     Subject: When do you tell kids about family money?
Anonymous wrote:So much hoarding. Does no one ever spend a dime on things that bring joy or do you all just hoard so the next generation can hoard


We spend plenty on "things that bring joy".

Own two homes, both worth $3M+ and both recently renovated (dont even ask how much that was), own 3 cars--most recent cost $95K, mostly travel Business class now and take 6-7 trips each year (most recent was 16 hour flight in business class---so about $8K roundtrip), gift the kids each $38K/year, also bought the recent college grad a new $40K vehicle, have about 1K bottles of wine and growing (yes we drink it, we also like adding more as we travel and explore) and the list goes on and on. Will spend even more once we are retired (in a year or so).

Still will be leaving $5-10M for each kid possibly more (or giving the "more" away to more charities)