Reader Mailbag: Family Worries

What’s inside? Here are the questions answered in today’s reader mailbag, boiled down to five word summaries. Click on the number to jump straight down to the question.
1. Controlling spending in retirement
2. Shaving not worth cost?
3. Checking out potential roommates
4. Losing hope
5. Financially irresponsible family
6. Child cost panic
7. Paying off student loans
8. Maintaining focus in busy office
9. Grass on gravel driveway
10. Gencon?

The idea of a “sandwich generation” really speaks to me. It’s that period when you’re simultaneously worried about your kids growing up and leaving the nest and concerned about your parents as they begin to grow old.

It’s something that I’m dealing with quite a lot lately. I’m watching my father inch into his seventies while my children are still in the single digits.

I fully expect this “sandwich” of worries to be the fodder for a lot of posts in the coming years. I know it’s certainly something I’m thinking about right now.

Q1: Controlling spending in retirement
I recently moved my mother into a retirement community and am about to list her house for sale. After sale expenses and debts owed she will make 40k – 50k profit. Her retirement income is $4000/month and her monthly expenses are currently under $3000, although they will increase as her health deteriorates. So she doesn’t need the house sale money now to live on and her health is so poor she won’t be able to spend the extra money on luxuries such as travel or a new car. She has lived all of her life in debt, always spending more than she has, until I took over her finances five years ago (I have POA). I am very concerned that if she is given access to all of the money she will quickly spend it all. She is an alcoholic and also has had problems with gambling and compulsive shopping. Even though she no longer drives, the retirement home provides transportation to stores and she often buys into subscription items on TV without realizing it. I would like to save most of the money to cover future medical expenses but think my mother should be able to have some money to spend as she chooses. Do you have any advice on how to handle this?

- Jerry

It really depends on your mother’s exact health situation.

If I were in your shoes, I would talk to her doctors. Go with her to her next few appointments and chat with her doctors. You need to get a sense as to what the long term prospects are for her life. Is she in a slow decline or a quick one? Knowing that drastically changes what you can do. Similarly, what kinds of insurance does she have to cover these looming expenses?

Once you have medical advice, I’d talk to a fee-based financial planner who might suggest the best thing for you to do with her money.

It’s very hard to know what the right choice is. Someone who is expected to only make it for another year or two might live another decade, and vice versa. The best you can do is get professional assessments and base your decisions on that.

Q2: Shaving not worth cost?
I’ve had a beard for three years. I trim it about every four days with an electric trimmer and it takes me about two minutes. My wife feels I should shave my beard as it would make me look younger and more professional, but it seems like I’d just be buying a bunch of stuff I don’t need. What does it really cost to shave?

- Darren

If you’re going to shave daily, there are many inexpensive options.

I’ve tried several over the years and for now I use a disposable razor along with a RazorPit to keep it sharp and I usually shave in the shower using the soap I’ve lathered my face with.

Once the sharpener was purchased, the cost per shave dropped down to around a penny or so (for the soap and a tiny fraction of the blade), to my best estimate.

Q3: Checking out potential roommates
I am a single woman who owns a house and my current roommate, a woman who works with me, is moving out soon. I would like to get another roommate to help out with the bills. How should I go about getting a new roommate? Where would I go to run a background check? What if they don’t want to give me their social security number? Can I run a background check without having that?

- Susan

While it won’t find everything, this article offers some good advice on doing a background check. You can hire a professional if you’d like, but most warning bells will be triggered by doing that type of check.

In the situation you’re describing, if I were considering renting, I would not give you my Social Security number out of identity theft concerns. It’s really up to you whether you require it, but you’re likely to turn away as many good people as bad ones by doing so. I would probably only require it if I were getting a professional background check.

There’s always some risk of having a problematic roommate no matter how much you check. The steps above should weed out much of the weirdness, but every additional step you take filters out a little more.

Q4: Losing hope
We have been living very frugally for the last five years but it feels like we’re making almost no financial progress at all. We’ve been making the minimum payments on all of our debts and double payments on the one with the highest interest like you suggest but there’s always some expense that we end up having to put on a credit card and so it feels like we take a step backward for every step forward.

- Annie

If you’re constantly using your credit card for unexpected expenses, then that means you need an emergency fund (or a larger one, if you already have one). Right now, you’re experiencing how hard it is to repay debts without an emergency fund to catch those unexpected expenses – and it is hard.

Your plan is simple: go down to minimum payments for a few months and build up $1,000 in your savings account. Once you have that, then go back up to double payments on your most expensive bill.

Whenever there’s an emergency, use the cash from the emergency fund instead of the plastic. Your credit card balances should be going down, not up. If your emergency fund is below $1,000 at the end of the month, put cash in there instead of towards extra debt payments.

This will cause your debt to head in the right direction over time.

Q5: Financially irresponsible family
My parents were great at pinching pennies when we had very few, but they spent their money as soon as they had any. There were hardly any money lessons that were taught except how to juggle bills with no money. When I finally started to get a small salary, I fell into the same trap as they did. I did manage to get out of credit card debt thanks to the examples set by friends and my significant other. I’m doing pretty okay now.

My siblings (I have three-one twin, two younger) have fallen into the same trap as my parents. One is getting married and putting the entire cost on credit cards and complaining that she can’t get a newer car because she wasn’t approved for the loan. The other is still living with my parents, but is not saving a dime. In fact, her creditors call me constantly because she put me down as a reference. The last is still in college, but needs to be bailed out at the end of every month and I’ve heard him saying, “what’s the point of having money, if not to spend it.”

I realize this is getting long, but the background is necessary for my question. Anyway, like you, I was the first person in my family to go to college. My siblings did make it through college and one is a teacher and one is going back to become a nurse. I’m finishing up my PhD in biomedical engineering. My question is this: when you broke the cycle and started to live frugally, how did your family react? If they were anything like mine, they feel like I’m elitist and condescending towards them. Part of their insecurity is that I have a higher education then them (they find it uncomfortable-I still think my parents are incredibly smart and I do appreciate all the hard work they’ve done). The other part is that I’m choosing a different road from them which just makes them uncomfortable. By choosing a different road, I’m declaring their way of life is wrong. My mom has tried to get me to reverse my lifestyle many times, “you can get a nicer car if you take out a loan or lease. you can get a smartphone, I’m sure you can afford the payment. etc etc. ” At the same time it really irks me that she has no retirement saving and yet she bought a new car. She bails my brother out, and then puts the rest of her month on the credit card.

My question is really three fold:

1. Do I just accept the elitist, condescending jerk title? It really makes me feel horrible and isolated from them. I’m not sure how to handle it any other way.There will always be some resentment there (I can’t take back my schooling). And I refuse to go back into debt to ameliorate it. Its going to get worse when/if I actually start to make more money. They also think my SO is elitist and condescending too. There’s not much I can do. Did this happen to you? if so, how did you deal with it?

2. How did you deal with your family once you became financially stable? Your parents were probably still making bad money decisions. Did you try to correct it? (this would make number one even worse- right now I’ve been keeping my mouth shut). I’m worried that I’m going to have to take care of both my parents and possibly bail out my siblings when I’m older. I’m struggling watching them make poor money decision after poor money decision, knowing that one day I will probably have to take care of them. or at least, be expected to.

3. Did you ever have to bail out family relatives? Did that really strain your relationship?
- Angie

My parents actually seem more financially stable right now than they ever have. They’ve mostly just seemed proud of me and haven’t ever really pushed me to spend money other than a bit of encouragement to get a house once we started having children. I don’t think they’ve ever said a word about our car purchases or anything else – if they have, it’s been so infrequent that I don’t remember it. My siblings really don’t have much to say about it, either – although we don’t have much in common, we do get along fine with family events and there’s no real direct conflict, just perhaps a lack of closeness.

I have never bailed out relatives. None of my close relatives have ever asked me to. Once, I gave money to a relative to help out with a huge family expense that they took on in a very courageous fashion, one that I could have (and would have… and felt guilty about being unable to) helped with in terms of non-financial assistance had I lived near them. I felt somewhat responsible for and guilty about the situation, so I simply insisted that they take some cash to help. They never asked me for a dime.

I can’t speak to what they think or feel about me when I’m not around, but I am thankful that my family is nice and polite enough that I’ve never had any major confrontations with any of them over money issues. Although I might feel some distance from some family members, I think it has more to do with personal interests than it does with money. For instance, many of my extended family members enjoy deer hunting, while it’s not something that I’ve ever become passionate about. I respect their hobby, but it’s not just something I have an interest in – I’d like to think they feel more or less the same way about my own hobbies and interests.

Q6: Child cost panic
Our baby is due in November. We’ve been calculating the costs of everything and seriously panicking. We just don’t see how our budget stretches to cover a child’s expenses. We’ve got insurance for the birth. It’s the monthly expenses like child care and diapers and everything that’s scaring us.

- Marcia

I can’t tell you the answer to this because I don’t know exactly how you live, but when Sarah and I had our first child, we had similar fears.

What we found is that our life changed enough over the first year or so of our child’s life that not only did we handle the new expenses, we actually began a positive financial turnaround. In other words, we were spending far more when we were childless than we did after having our first child.

Our whole routine changed. We couldn’t easily go out in the evenings any more, so we stayed at home. We shopped less. We spent less. We spent more time together. We ate meals at home. Our spending just dropped drastically.

Q7: Paying off student loans
I’m a newly minted college grad and I’ve been lucky enough to find a full time salaried job (at a financial institution, which is how I came across your site). So far, everything has been pretty great. I’m pulling in way more per pay period than I ever made in two months at my waitressing jobs in college, and I’m contributing to a 401(k), as well as savings.

My question is about my loans. I’m very very in debt from college. I went to a state school but I still have upwards of 24,000 dollars in loans. I’m in a grace period right now because I’m a new grad, but that interest is looming. I have a small amount (about $6000) saved from working in college and bonds given to me as a child. Should I deplete that savings and pay down the loan, then start fresh with my savings at my new job? Or should I hold onto that money for a little while, at least until I can contribute a little more to my savings?
- Sam

I would not empty out that savings. I would keep at least a month’s worth of living expenses in case of emergency, then I’d use the rest to pay down the debt.

After that, I’d make the largest payments I could toward that loan as long as you don’t have any other specific savings goals.

Getting rid of that debt will certainly help you down the road. If you’re making this kind of money, you should be able to knock it down quickly.

Q8: Maintaining focus in busy office
My work environment is really social and collaborative, which works great for brainstorming ideas and sharing concepts but is terrible for actually moving forward on the hard work of projects. I’m trying to figure out a way to balance the great collaborative nature of the office with a need to focus on projects.

- Stephen

Work outside of the office for part of the day. Find another environment where you can avoid being distratcted.

Depending on your workplace, this might be very easy, or it might require talking to your boss and working something out. Still, if you have a problem and a potential solution that’s reasonable, your boss will likely be supportive of it provided it doesn’t affect your productivity.

Collaborative workplaces are great, but there are times when it reaches a point where it can limit your productivity. The best balance is very hard to find.

Q9: Grass on gravel driveway
I recently purchased property that included a gravel driveway around 80 yards or so. Some of the grass has been growing up between the gravel, and I have been trying to determine the best way to eliminate it permanently.

Obviously, the first choice is Roundup, but that can get pricey over a large area. I have read that you can use salt water, bleach, and even boiling water to kill the grass. The obvious order of these in terms of price are boiling water, salt, bleach. Boiling water might make some sense to clear plants through cracks in the driveway, but I don’t think it will scale. My initial experiments with salt water have been inconclusive, but I’m not sure I’ve discovered the proper concentration. I have not tried bleach, and I think it may not be the best solution to my grass problem.

Do you think it’s even feasible to try this route, or should I go with roundup? Do you know of any other solutions?
- Marcus

Boiling water or boiling vinegar will get rid of the grass that’s there, but they’re temporary solutions. Roundup is also temporary, though it lasts for longer.

My parents have a gravel driveway and they long ago decided it was a losing battle. They just keep adequate gravel on the driveway and if some appears on the edges, they don’t worry about it too much.

There isn’t a permanent solution I know of that doesn’t involve paving it.

Having said that, grass does offer a nice advantage for a gravel driveway. It keeps the gravel from washing away. So, if you can tolerate the look, you’ll have a drive that lasts longer.

Q10: Gencon?
It was great seeing you at Gencon 2013! What games did you like there?

- Alan

I actually ran into several Simple Dollar readers at Gencon 2013. Gencon is an annual tabletop gaming convention in Indianapolis that I attend with a group of friends each year.

There were several games I liked there. My favorite was either Trains (a game involving playing cards to build train routes on a map board) or Pathfinder Adventure Card Game (a distillation of the Pathfinder role playing game into card form). I played several prototypes I was very impressed by, including Compounded (a chemistry-themed game) and Impulse (a space-themed card game).

The best part of Gencon, as always, is people – seeing old friends, playing games with them, and building new friendships.

Got any questions? The best way to ask is to email me – trent at thesimpledollar dot com. I’ll attempt to answer them in a future mailbag (which, by way of full disclosure, may also get re-posted on other websites that pick up my blog). However, I do receive many, many questions per week, so I may not necessarily be able to answer yours.

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