How to talk with your parents about their finances

Talking to your parents about their finances probably seems like one of the most awkward you conversations you could ever have. I'll bet it ranks right up there with the sex talk your parents gave you when you were a kid — or that you’ve had with your own children.

I grew up in the South, where we don’t talk about money or sex. So when I asked my mom where babies came from, she told me a man and woman "make love". That’s it. That was the extent of the conversation.

I have three kids, so clearly I figured out where babies come from. When my oldest was 10, she asked me where babies came from. I didn’t say something vague like, “A man and woman make love.” I simply told her the basics. She then looked at me – and remember, I have three kids – and said, “Ooh, you did that three times.”

I decided to be upfront with my kids because I wanted them to know they could feel comfortable talking to me about a topic that many people consider taboo. Like the money talk with parents, it’s only as awkward as you make it.

However, unlike the birds and the bees talk, you cannot figure out your parents’ finances unless you actually get the details.

I learned this the hard way.

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GRS Insider #92: Racism is not a political issue. Racism is a MORAL issue.

Yesterday, as I do most Fridays, I sent the GRS Insider to folks who subscribe to the Get Rich Slowly email list.

The email was unusual. It was more like a blog post than a simple summary of recent articles. I've had several people request a version they can share with other people, so -- this one time only -- I've created a stand-alone web version.

Parts of this have been edited slightly to account for the transition from email to web.

If you've been reading me for any length of time — or if you know me in person — you know that I hate conflict. I hate hate hate it. Some people seem to thrive on it. Not me. I shirk from it.

This is one reason I've steadfastly kept my financial writing politically neutral. I don't want conflict.

It helps that I'm neither liberal nor conservative. I'm some strange mix of the two. But mostly it's because I think financial advice is important for everyone regardless of political persuasion. It's rare that I take a stand on something political.

Because of who I am and what I believe, Get Rich Slowly will never become a political platform. (It'll touch on politics occasionally, but politics will never be a driving force at the site.)

That said, I'm mad as hell about not only the recent bout of racism in the U.S., but also the long history of racism that underpins our society. Something's gotta give. The current protests are 100% justified and they're not acts of terrorism. They're a call for action. What sort of action? I have no idea. I don't have solutions. But the problem is plain as day and it must be addressed. We, as a nation, must — at long last — deal with our history instead of sweeping it under the rug.

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A candid conversation about race in America

Minneapolis, Denver, NYC, Oakland, Atlanta, Washington D.C., Louisville, San Jose, Des Moines, Detroit. The list goes on. These are just some of the cities that have experienced protests in the past week.

George Floyd's murder (and murder-porn video) was one of the catalysts for these protests. But let's be clear: Sooner or later, this was going to happen. Things are not okay in America. America's continuing issue with race, inequality, and the routine acceptance of the mistreatment of black people and other people of color came to a head in the last couple of days.

Then, we had Amy Cooper in New York City calling the police on Christian Cooper unecessarily during a normal incident that plays out all the time - annoying people with their dogs off leash. That one call could have resulted in Christian Cooper's death.

In this episode of Michelle is Money Hungry, I'm going to get candid about race in America, money and opportunity, and what's next.

This is a very difficult show for me to do because I have so many thoughts racing through my mind. The goal of this episode is to give a better perspective of what people are angry about and to leave with ideas of how we collective can do better. And, honestly, I have to say something about this. And just so you know, this is not the first time that I've talked about race and wealth in America on my website and podcast. (But it's the first time J.D. has shared my work here at Get Rich Slowly.)

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Our first annual family meeting

Yesterday, to celebrate Thanksgiving, Kim and I instituted what we hope will become an annual tradition. Yesterday, we held our first annual family meeting.

Kim approached me with the idea last week. "I think it'd be nice to sit down and talk about our goals," she said.

"I agree," I said. I was thinking of the article Matthias shared here in August. Matt and his wife create five-year plans to co-ordinate their shared future. They spend a day drafting couple goals to build their dream life. I've been thinking that Kim and I should do something similar.

So, yesterday morning over coffee, we sat down for our a family meeting. We talked about the current state of our household -- and we talked about where we'd like to steer things in years to come.

J.D.'s Rocky Year

"It's been a rocky year for me," I said, although Kim already knew this. "I've been fighting anxiety and depression since March. I've had a few patches of amazing productivity and good self-worth, but I've spent a lot of my time trying to keep from drowning. Metaphorically."

"That's true," Kim said, "but you're making good changes. You're exercising. You're drinking less. You're seeing friends more often. You've stopped wasting time on videogames. And you have your big project coming up."

"Right," I said. I've been recruited by Audible and The Great Courses to create a ten-part (five-hour) series on financial independence and early retirement. "That work is going to take most of this winter. The first five lectures are due at the end of January. The rest of the course is due at the end of March. I'll fly to D.C. in early May to record the audio."

"Will the project pay enough to fund your lifestyle?" Kim asked.

"Sort of," I said. "It's four months of work, and it'll probably end up funding about four months of expenses. That's not bad, but it's not great either. But I'm not really doing it for the money, you know."

"How are your finances?" Kim asked. Believe it or not, in our nearly eight years together, we've only talked about money in-depth a couple of times. We trust each other, so we haven't felt the need.

"Things aren't as good as they were three years ago," I said.

"What do you mean?" she asked.

Notes for family meeting

"Well, when we returned from the RV trip in June 2016, I felt completely at ease financially. I had enough saved that I never felt like I had to work again. I could do what I wanted, when I wanted."

"That's not true anymore?"

"Not really," I said. "You know I'm not squandering my money, obviously, but let's look at the numbers. Over the past three years, I've spent $400,000 on a bunch of big stuff: buying back Get Rich Slowly, remodeling this house, those investments in other businesses. I'm not blowing the money on gambling and hookers. These are all financial decisions that made sense in the moment, but which have left me feeling pinched."

"Are you running out of money?" Kim asked.

"No, not really," I said. "I just don't have as much as I want. Look. I'll show you the numbers."

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How adopting two girls changed my money mindset

I’ll never forget the moment I got the text message from my wife: "Do you want to adopt two girls?"

I was at work. We'd been exploring adoption for the previous year but had hit some roadblocks. Adoption wasn’t really on my radar anymore, and we had never discussed adopting more than one child.

And if I’m being honest? Girls weren’t really on my radar either. We have two biological sons, and I thought one more boy would be nice. Adopting two girls wasn’t part of the plan.

But my response? "Sure."

At that moment, regardless of my preconceived thoughts and dreams, I knew I was supposed to say yes. I felt it inside of me. I'm glad I did.

My wife and I adopted two girls. It was expensive. There are a lot of adoption costs that people don't think so. All the same, we're glad we did it.

 

Our Adoption Story

Our adoption story is unique. All adoption stories are unique. No adoption is normal.

As I mentioned, we have two biological boys. They're pretty cool — most of the time. At the start of our adoption journey, they were ages five and two. The girls were ages eight and five.

We live in Ohio. The girls were from Florida. The eldest was born in Thailand (where their biological mom used to live) and the youngest was born in Florida, where their dad resided.

Their family suffered a couple of major health tragedies so that their parents were no longer able to care for them. They feared the girls would be taken away and put in the foster care system — possibly separated. As much as they didn’t want to lose them, they wanted to find a good family that would adopt them both so they could stay together.

I have so much respect for their parents and what they did for their girls, knowing it was probably the hardest decision they ever had to make. It turned out to be a smart decision. Both parents have now passed away.

Anyhow, the girls had come to visit cousins in Ohio for the summer. My wife, who is a teacher, heard about the girls' story through a colleague. It was then that she sent me the text message.

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A self-made man

Dad at the LatheMy father died twenty-four years ago today.

As I drove to the airport this morning -- I'm on a short trip to San Diego -- my mind drifted back to him and what he was like.

I don't think of Dad often anymore, and when I do it's mostly superficial stuff: Dad was fat. His hair was wild and wavy. He could be gruff. He was funny and had a contagious laugh. Sometimes he wasn't a very nice guy. Sometimes he was. But it's tough to remember what Dad was like as a presence, you know?

What I remember most about him was how Dad could do anything he set his mind to. This isn't nostalgic hero worship. It's how he actually was. My father could teach himself to do anything he wanted. And he wanted to do a lot.

A Self-Made Man

I'm not sure where my father's love of learning and experimenting came from. His parents were a simple, devout Mennonite couple.

When I knew Grandma and Grandpa, they managed a small farm. They had milk cows. They raised blueberries. They grew and canned vegetables. Grandpa cut his own wood. He'd been a janitor at the local high school, but by the time I was around, he was retired. Every night, he and Grandma sipped Sanka and played Scrabble. Their existence was simple, ordered, and serene.

My father wasn't simple. His life wasn't ordered. He was not a serene man. He was complex. He was messy. He was boisterous. He was a force of nature. (I come by my ADD honestly.) He had many interests, and he liked to indulge them all.

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Financial advice from my father (when I was nineteen)

Dad at work in his shop"Who was there for your father when he died?" Kim asked me a few moments ago. She's interested in becoming a death doula, so she's reading a book about end-of-life care.

"It's odd you should ask that today," I said after I told her the story of my father's six-year battle with cancer.

"Why?" she asked.

"Today is the equivalent day in my life as the day when Dad died in his," I said. "It's ten days until I turn fifty. Dad died ten days before his fiftieth birthday. So, it's a somber day for me. I'll be thinking of him all day."

Actually, I've been thinking of Dad all week.

It started when I published Naomi Veak's story about how she learned to stop feeling hopeless about money. In that article, Veak shared a letter her mother sent her when she was nineteen years old. Veak was a poor kid at a rich school, and she was struggling to figure out finances. Her mother offered some words of wisdom.

I had the exact same thing happen to me at the exact same age at the exact same college. I was a poor boy at this rich school. During my sophomore year at Willamette University, when I was nineteen, my father wrote me a letter filled with financial advice.

Today seems like a good day to share it with you folks.

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Five lessons I learned while making a documentary film about FIRE

When J.D. decided to spend three weeks in Europe with his family, he asked a few people if they'd be interested in contributing articles during his absence. He even asked me!

My name is Scott Rieckens, and I'm new to the world of smart money management. I'm new to the world of financial independence and early retirement. I'm new, but I've totally immersed myself in it. I've immersed myself so much, in fact, that I've spent the past eighteen months creating a feature film about FIRE. (FIRE is the clumsy abbreviation for "financial independence/retire early". Basically, the FIRE movement is all about saving big so that you can choose to live however you want.)

"You've been in a unique position over the past year," J.D. said when I asked him what I should write about. "You've had amazing access to a variety of people who think and write and teach about financial independence and early retirement. You've been able to hear what they think and say in private as well as public. What about sharing your biggest takeaways from this experience?"

Perfect! I can dish out everyone's dirty laundry and avoid posting those embarrassing stories on my own site. It's a win-win for me, really. J.D. is such a sucker.

You ready? Let's go behind the scenes of the early retirement movement. Here are five things I learned while filming Playing with Fire.

Lesson #1: The FIRE Movement is Polarizing

When I started down the rabbit hole of early retirement blogs and podcasts, I was swept up in the euphoria that many others have experienced: "Holy moley, I'm going to retire in less than ten years!"

Coming from fifteen years of a spendy, financially-illiterate lifestyle, this was a huge revelation that gave me hope, joy, excitement, and...butterflies. Imagine the control over your life! Imagine the freedom! Think of all the ideas I will chase, the whims I can explore! Think of what this means for my family!

Somehow, though, I missed the blog post or podcast episode that explained just how difficult it can be to live within the FIRE framework while the people around you wonder what the hell you're talking about.

  • "But I like my job."
  • "That sort of lifestyle sounds terrible."
  • "Are you joining a cult?"

These reactions dampened my enthusiasm. Nobody had warned me that there might be people who thought we were crazy for pursuing financial freedom.

Now, as FIRE is spreading through the mass media, there's been push-back from unexpected corners. Financial guru Suze Orman says she hates the FIRE movement. The comments on articles and interviews around the web are often negative -- even hateful.

I wasn't expecting that. How can something so positive be viewed with so much negativity?

Since starting our project, the number-one thing we hear from early retirement folks is: "I really hope this film makes it easier to share FIRE with my friends and family. Every time it comes up, things get weird and my already-socially-anxious-self gets all clammy."

I can say unequivocally that we have the same hopes.

Our society's relationship with money seems completely broken. When the best-selling vehicles are full-sized $60,000 trucks, yet 70% of Americans are living paycheck to paycheck, it seems the general population is managing money at a fifth-grade level. (And again, that used to be me before I found FIRE.)

We've got a lot of work ahead of us.

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The case for separate (but combined) finances

In the world of personal finance, the subject of how couples share (or don't share) their money comes up time and time again. It's no surprise. After all, money problems are a leading cause of divorce.

But for some reason, the concept that "personal finance is personal" doesn't always factor into people's opinions about combining finances -- especially within a marriage.

Often, people argue that in order to be a team, couples must combine finances fully. Or that separate accounts mean there's some lack of trust within the relationship. Or that you aren't truly committed to each other. Or that you must not be on the same page about long-term hopes and dreams.

None of these things are true. Plenty of committed couples keep separate finances. These couples are teams. They trust each other. They share the same hopes and dreams. But for a variety of reasons, separate finances work well for them.

Today, I want to share an alternative to these two dominant modes of money management. I want to share how couples can both keep their finances separate -- and combine them. Confused? Let me explain.

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The perfect gift is cheap and easy

If you're panicked because you still haven't thought of the perfect gift for the people on your Nice List, you'll be relieved to know you don't need to spend as much time as you might think looking for something thoughtful. You also don't need to run up your credit card bill.

Why? Because neither of these things is likely to be appreciated by the gift getter.

In fact, a 2008 study from Stanford University researchers found that spending a lot of time and money to select a gift doesn't make a bit of difference to the recipient. According to Francis J. Flynn, an organizational psychologist at Stanford, the price of a gift is more important to the giver than the getter. (Plus, most recipients actually prefer cash or something from a gift registry, such as their Amazon wish list.)

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