The question
My parents are in their mid-80s and very financially stable (top-hat pension, substantial savings and real-estate equity). My spouse and I are both high-earning professionals with two university-aged children. I have siblings, each with children in their 20s, some still in university. Although my siblings are well-employed professionals with excellent pensions, they have asked, and my parents have funded, their children’s university education (on average as much as $30,000 per year, per child). No such request has been made by me of my parents nor has any offer to do so been made by them. I accept that my parents are free to do what they want with their money. And yet, I believe they are acting on a (flawed) view of needs-based funding and their approach is inequitable. I don’t want to create rifts in my family but do I raise my concerns with them, or my siblings?
The answer
I should admit right off the top I’m no expert when it comes to money.
You’d think, as the son of an Massachusetts Institute of Technology-trained economist I might have picked up a couple of things.
But I didn’t.
P.S. I phoned my father, the M.I.T. PhD in economics asking him what a “top-hat pension” is and he had never heard of it.
But Google trumps even an M.I.T PhD and so I looked it up and now know it’s a “nonqualified deferred compensation plan that allows participants to defer income into the plan during each calendar year.”
Which sounds really … quite … excellently … ah, who am I kidding? I have no idea what any of those words mean. (Told you: not a financial expert.)
But I do have a sense of what you mean when you talk about “needs-based funding.”
And I think it’s an issue a lot of families deal with and can cause a lot of contention. (Nothing like families and money and wills to really get the pot percolating.)
Example: My sister and husband are rich and I’m not (she’s a lawyer married to a lawyer and they inherited a bunch of cash from his mother).
Yet I’m pretty sure my mother and father are planning to distribute whatever funds are extant upon their respective demises equally between my sister and brother (who has no kids) and me.
And part of me feels like: “Why, why, why? I need the dough and my brother and sister don’t – well, not nearly as badly.”
I just visited my sister in Virginia and there were five cars in front of her house. I thought: “Oh, she has visitors.”
But no: One car was for her, one for her husband, one for her 18-year-old, one for her 16-year-old, and one … wait for it … for her dog.
That’s right. She has a whole car for ferrying the dog around, because it sheds. The car is full of dog hair, and stinks.
In summary, my sister doesn’t need money.
Should I have worked harder, become Elon Musk or Kylie Jenner (perhaps the world’s youngest-ever self-made billionaire at age 21)?
Maybe. I reproach myself for not becoming either of those two people. Shooting rockets full of punters into space, tweeting up a storm, prancing around promoting my latest fragrance, “That Dave Eddie Feeling™.”
Sadly, none of that ever happened.
So far. In the meantime, I don’t really have a problem with parents dispersing funds on an unequal, “needs-based” basis.
Now, I understand why some people might not agree. My own in-laws are scrupulous about allocating moneys equitably amongst all their offspring and I certainly understand and respect that is the good, old-fashioned way.
And a great system when everyone involved is basically “fine,” financially.
But it’s different if anyone in the family experiences any kind of glitch, or problem. I don’t want to suggest anyone should mindlessly throw money at a problem, especially if it might be seen as encouraging that problem.
But that doesn’t seem to be the issue in your case. So my advice is to suggest your parents are doing the best they can, to speculate these types of decisions are more difficult than you assume, and since you are by your own testimonial “fine” and not only that “high-earning” individuals enjoy all the cash flying around and not create (also your words) “rifts in your family.”
Because family is key. Family is all-important. They will speak at your memorial. The rest is all negotiable in time.
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