Why do we so cavalierly take the help we got from our parents as a matter of course, and then turn around and refuse to consider doing the same for our children?
I wait for it in every episode of ChooseFI – the moment the interviewee says “and then we lived with my parents.” It’s so prevalent as to be seen as a matter of course. A man got out of prison and had nothing going for him (except he lived with his parents while he got his retirement figured out). A couple has set up tons of entrepreneurial projects, some of which failed and some of which succeeded, and they did it all with nothing (except that they live with her parents, so their actual living expenses are minimal). I just did a Google search for “ChooseFI ‘lived with my parents'” and what I notice is not so much that this is a nugget in so many stories, but that it’s just a side note. “And then I lived with my parents for 3 years while I paid off my debt.” No big deal.
It’s not in every episode, but it’s often there, and it’s something that is seen not just as a matter of course, but a smart choice, a sacrifice on the part of the person who is trying to reach FI. If you want to get serious about paying off your debts, suck it up, live with your parents, get rid of your expenses while you turn yourself around.
I want to say here, upfront, that I have lived with my parents myself. I’m not trying to suggest that it’s somehow dishonorable or selfish. My parents helped us out when we first came back from the Peace Corps, and I don’t think we would have managed had we not been able to live with them. I’m grateful.
What’s often overlooked, though, is the enormous sacrifice that comes on the part of the parent. My MIL lives with us and is wholly dependent on us for housing, food, health care…well, wholly dependent. Anything else that comes up. It was a huge shock to our budget when she moved in. I had foolishly thought that we could just fold her into our lives, we already had the space, and were using the electricity and water, and groceries couldn’t be that much, right? Except within eight months we went from 0 credit card debt to $8,000 credit card debt and I realized that we spend, month after month, about $1,000 on her expenses. And we live cheaply, it’s not like we’re taking her out to fancy restaurants. She doesn’t have a cell phone (although she has an old phone for WiFi access), she rarely gets new clothes. $1,000 a month.
Even if the dependent is paying for some of their own expenses (health care, maybe, or chipping in for groceries), there is an opportunity cost on the part of the parent: could they be renting out that room to somebody else? Downsizing?
On the path to FI, the message is that you do what it takes to increase the savings. House hacking and downsizing are two such things. At the same time, we expect our parents to hold space for us so that when the time comes, we can sidle into their homes and use up their resources, then feel proud of ourselves for cutting the housing costs. We certainly don’t expect them to house hack or downsize.
This is all well and good – but then, what do we expect will happen with our children?
We determine FI numbers, most often based on trimming as much of the fat as possible. Reduce housing costs, reduce transportation costs, reduce groceries, and then take that times 25. Do you have that much saved up? You’ve done it! You’re set forever.
There’s a mismatch here. “My parents took care of me so I could supercharge my retirement” is a given, but there’s nothing about “I’m going to keep a larger house so if my 25-year-old wants to supercharge their retirement, I can make that happen.” Cut cut cut cut cut for yourself, lean on others around you, and then what’s left for when your kids want to do the same? When you’ve already set yourself up for a specific FI number that is based on your living expenses, not somebody else’s?
A recent article showed that parents are often forgoing retirement contributions so that they can help their kids. In the FI community, this causes some scoffing – why aren’t those people saving for retirement first? Why would you raise your kids to be dependent on you instead of making their own money? My kids aren’t going to depend on me, I am not going to skimp on retirement so that my kids can be entitled brats.
(Except also, I lived with my parents for 3 years while I was paying off debt and getting my retirement started).
I hope that when my kids are grown, if I can help them out, I will. If I reach some magic FI number, I’m going to keep working, because to me, FI is more about security than retiring early. And because I love my job. And not least because I want to know that if my kids need something – a room in my home so they can start their retirement funds, help with loans to pay for college, a cushion to help them set themselves up for success – I will be able to do that for them.
I love the ideas around FI for a lot of reasons, but the prevalent feelings about how we treat the generation before us (they should help pay for our college, let us move in with them) and the one after us (they should pay their way through community college or trade school, understand that we are house-sitters so there’s no way that we could let them live with us) are at complete odds with each other. My goal, as I move forward, is to keep generational responsibility in mind.