Author Topic: young adults learning the hard way - update post #29  (Read 31901 times)

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GSNW

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Re: young adults learning the hard way - update post #29
« Reply #60 on: March 04, 2013, 01:56:20 PM »
I guess this why people put the caveat in their will for sums that large to be paid when the receiver is 25.

Pissing away 500,000...

Definitely true. Two of my cousins blew through an appalling amount each on meth and cars. I'm a fan of making the trustee live off of the interest until a certain age, like 25 or 30, before they get the principle. (If they ever do.)

Oh I agree 100%! I d@ted a guy who had cousins who inherited millions when they turned 18 - their family had a well known regional chain of dept. stores.  At the time we were together, almost 20 years ago, all three cousins were I believe in their 30's, and none had any direction in life. They had just p*ssed away a great deal of their money. If I recall, a relative stepped in and somehow gained control, maybe a parent? and they then were given an allowance to live on, which I think was what they did. But none of them ever really had a job, or went anywhere in life.  It's kind of sad actually.

I know I say if I ever win the lottery, I'd be so much smarter with it now, than I would have at 18.

I think that's part of the reason it's such a sad story - 500k is a life-changing amount for the majority of people.  I could buy a home I really love outright and never have a mortgage payment again, imagine!  I love my job, so continuing to work would be no problem, but our paychecks would be spent on fab vacations.

The other reason the story is sad is that this is a place where parents had the legal authority to step in.  Grandma said that my friend was supposed to get half right away (still too much IMO) and the other half when he graduated college.  Mom, who was the executor as I understand it, just forked it all over.  I don't know the legalities of that and it doesn't matter at this point, but it doesn't seem like doing your kid a huge favor.  And it wasn't.

Cami

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Re: young adults learning the hard way - update post #29
« Reply #61 on: March 04, 2013, 02:52:36 PM »
I guess this why people put the caveat in their will for sums that large to be paid when the receiver is 25.

Pissing away 500,000...

Definitely true. Two of my cousins blew through an appalling amount each on meth and cars. I'm a fan of making the trustee live off of the interest until a certain age, like 25 or 30, before they get the principle. (If they ever do.)
I had a friend in high school who came into a trust fund at the age of 18 and blew through it all by the age of 21. She spent it on a Trans Am and cocaine.

With that example, when we had our dd and wrote a will, I insisted that upon our death, all of the money would be put into a trust and she would only get the interest off of it until she turned 25. Now that my dd is college-age, she's pretty mature and our lawyer -- who knows her -- suggested we strike that proviso. I refused because she can be a little too generous with people with sad sack stories and I view it as  protecting her against giving away her money to some con artist.   Hopefully she'll be older and wiser by the time she's 25.

Piratelvr1121

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Re: young adults learning the hard way - update post #29
« Reply #62 on: March 04, 2013, 03:52:15 PM »
My best friend, as godmother to my youngest, has got a savings bond started up for him. I think he'll be able to access it when he turns 18 but there will be discussions as to the smartest ways to manage that money so that it won't be all gone before he can blink. 
Beyond a wholesome discipline, be gentle with yourself. You are a child of the universe, no less than the trees and the stars.  You have a right to be here. Be cheerful, strive to be happy. -Desiderata

siamesecat2965

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Re: young adults learning the hard way - update post #29
« Reply #63 on: March 04, 2013, 03:58:18 PM »
I know if I had ever been the recipient of a substantial sum of money at a young age, even outright, my parents woudl have done everything they could to help me NOT blow it all. And if I chose to, I can tell you, things would have been quite frosty between us had I chosen to ignore all their advice.  I can also say I woudl have been really tempted to spend it unwisely.

Also, back in HS, i had some AT&T stock I had gotten as a baby, and dividends were reinvested. When AT&T had to divest back in the early 80's i got about $400. Which to me was a HUGE sum of money. My parents, howver, made me put it in th bank, and use it to pay for books in college. I was not happy with them, but I followed their instructions, and was glad once I saw how much books cost!


LadyClaire

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Re: young adults learning the hard way - update post #29
« Reply #64 on: March 04, 2013, 04:00:05 PM »
Sometimes age doesn't bring wisdom when it comes to money. When my grandmother died, my father inherited close to $300k. He blew through it in a year. He was 52 years old at the time. He didn't use it on anything sensible, either. He didn't pay off the house, or do any of the much needed repairs. He spent it all on clothes, a couple of old Mustangs, car parts, and concert tickets.

Lynn2000

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Re: young adults learning the hard way - update post #29
« Reply #65 on: March 04, 2013, 04:16:39 PM »
I think the original story is interesting because, if the scholarship had been obtained, it would have impacted not just the teenager but also his parents--I'm assuming it was a decent amount of money which otherwise his parents had to pay. It sounds like the OP was somewhat doubtful he was going to get the scholarship anyway; but I think it's harder to stand back and let someone fail, when their failure is going to impact you--not just being sad to see them sad, but in some tangible way. Maybe that's more selfish? But, it's also selfish of the other person, too, to refuse to do something small (like take clothing advice) when other people are relying on them in some way. I feel like I was really dumb as a teenager, though, and even well into college--22, 23. At least I erred on the side of caution, but it was so hard for me to see the bigger picture and empathize with other people.  :P
~Lynn2000

TootsNYC

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Re: young adults learning the hard way - update post #29
« Reply #66 on: March 04, 2013, 04:31:43 PM »
yeah--I know what you mean. My kid not doing his homework could impact me, bcs if he blows the chance to get a scholarship, or even to get INTO a particular school, it may impact me quite a bit.

I keep trying to say to myself, "It's his life; it's not your life," and it doesn't *have* to be my college bills, I guess. But it does impact me.

Lynn2000

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Re: young adults learning the hard way - update post #29
« Reply #67 on: March 04, 2013, 04:35:07 PM »
yeah--I know what you mean. My kid not doing his homework could impact me, bcs if he blows the chance to get a scholarship, or even to get INTO a particular school, it may impact me quite a bit.

I keep trying to say to myself, "It's his life; it's not your life," and it doesn't *have* to be my college bills, I guess. But it does impact me.

And it's a matter of degree, too--like, the kid not doing one assignment in second grade might very well teach him a lesson about being more responsible in the future (when he gets punished at school somehow), and it's not going to affect what college he gets into, you know? But that's very different from a junior in high school who seems to be blowing off all of his classes all semester.
~Lynn2000

magicdomino

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Re: young adults learning the hard way - update post #29
« Reply #68 on: March 04, 2013, 05:18:42 PM »
Sometimes age doesn't bring wisdom when it comes to money. When my grandmother died, my father inherited close to $300k. He blew through it in a year. He was 52 years old at the time. He didn't use it on anything sensible, either. He didn't pay off the house, or do any of the much needed repairs. He spent it all on clothes, a couple of old Mustangs, car parts, and concert tickets.

No, it doesn't.  I know someone who inherited about $150,000, and blew it within a couple of years.  She did buy a house, a rundown fixer-upper, but didn't budget for repair cost.  She expected her children and husband to provide free labor, supplemented by cheap labor by neighborhood teens.  Well, the children lived pretty far away with their own families and homes. The husband was stationed overseas in the military, and was not happy to spend his leave working on what his wife insisted was her house.  (I think she was the only one surprised when he filed for divorce upon reassignment to the U.S.)  She hired some cheap labor -- although not neighborhood teens -- with unfortunate results.  Meanwhile, any money left over was spent on all sorts of building materials, appliances, bathroom fixtures, every single bit of garden decoration sold by Walmart, and expensive Christmas presents for her grandchildren.

Cami

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Re: young adults learning the hard way - update post #29
« Reply #69 on: March 05, 2013, 10:32:30 AM »
Sometimes age doesn't bring wisdom when it comes to money. When my grandmother died, my father inherited close to $300k. He blew through it in a year. He was 52 years old at the time. He didn't use it on anything sensible, either. He didn't pay off the house, or do any of the much needed repairs. He spent it all on clothes, a couple of old Mustangs, car parts, and concert tickets.
Oh absolutely. I have a relative who has blown through more than 1 MILLION DOLLARS on such worthwhile expenditures as mani-pedis and spa days. Meanwhile, their house is falling apart and they never paid off their mortgage. But they sure do have glowing skin and "wicked awesome" nails.

Virg

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Re: young adults learning the hard way - update post #29
« Reply #70 on: March 05, 2013, 10:57:34 AM »
Lynn2000 wrote:

"I think the original story is interesting because, if the scholarship had been obtained, it would have impacted not just the teenager but also his parents--I'm assuming it was a decent amount of money which otherwise his parents had to pay."

The bolded part jumps out at me.  Maybe it's just me, but I never saw any law passed that required a parent to foot the bill for a child's college education.  Sure, it happens all the time, but if my child blew a college scholarship through his own bad decisions, especially after going against or ignoring my advice, I'd have to think long and hard before ponying up the funds to offset it rather than put it right back in his lap to deal with.  Part of learning one's own lessons is dealing with the consequences of those decisions, and so the obvious consequence is that he has to figure out where to come up with the money that the scholarship would otherwise have provided.  If that means he's got to deal with heavier debt to get through school, then that's a life lesson learned and the next time such an opportunity arises I'd bet he'll put in more effort.

I can understand the idea that getting into a good school is extremely important, but at the same time my take on the whole thing is simple.  If my child doesn't put the effort into getting into Harvard including the understanding that outside advice will help his chances, then he probably doesn't belong at Harvard, and the vast majority of people in the world live a full life without a Harvard degree so it's not a life-or-death decision.

Virg

jaxsue

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Re: young adults learning the hard way - update post #29
« Reply #71 on: March 05, 2013, 11:10:10 AM »
Lynn2000 wrote:

"I think the original story is interesting because, if the scholarship had been obtained, it would have impacted not just the teenager but also his parents--I'm assuming it was a decent amount of money which otherwise his parents had to pay."

The bolded part jumps out at me.  Maybe it's just me, but I never saw any law passed that required a parent to foot the bill for a child's college education.  Sure, it happens all the time, but if my child blew a college scholarship through his own bad decisions, especially after going against or ignoring my advice, I'd have to think long and hard before ponying up the funds to offset it rather than put it right back in his lap to deal with. Part of learning one's own lessons is dealing with the consequences of those decisions, and so the obvious consequence is that he has to figure out where to come up with the money that the scholarship would otherwise have provided.  If that means he's got to deal with heavier debt to get through school, then that's a life lesson learned and the next time such an opportunity arises I'd bet he'll put in more effort.

I can understand the idea that getting into a good school is extremely important, but at the same time my take on the whole thing is simple.  If my child doesn't put the effort into getting into Harvard including the understanding that outside advice will help his chances, then he probably doesn't belong at Harvard, and the vast majority of people in the world live a full life without a Harvard degree so it's not a life-or-death decision.

Virg

Per the bolded: ITA. It's amazing how motivated one is when they are ultimately responsible for the results. I have a friend whose daughter drags her feet about anything scholarship-related (or anything financial, come to think of it). She could actually qualify for quite a few scholarships, but the courts decided (upon her parents' divorce) that the parents pay 100% of her college costs. She knows this, of course, so there is absolutely no motivation for making an effort on her own.

There's nothing wrong with paying for a kid's college education, but there is not a parental failure if kids pay for their own. In my case, I was expected to get at least a BA, and on my own dime.

LadyJaneinMD

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Re: young adults learning the hard way - update post #29
« Reply #72 on: March 05, 2013, 11:32:26 AM »
There's nothing wrong with paying for a kid's college education, but there is not a parental failure if kids pay for their own. In my case, I was expected to get at least a BA, and on my own dime.

Me too.  I knew at a very young age that college would be totally on my own, but I MUST have it (but that's another whole long story).  I also did not qualify for any grants or scholarships.   It took me 16 years of hard work, 3 jobs at a time, and a breakdown, but I got that blasted Bachelor's degree, and paid for it all.  And it was SO worth it, too.

Along the way I also had to learn everything else about being an independent adult.  We were taught NOTHING at home.  Not how to budget, not how to dress, not how to eat properly, not how to get or maintain a healthy relationship.  We were well-cared-for kids, but taught nothing whatsoever about being independent adults out in the world.  It was a hard struggle, and probably will never be over, but I did it.  Got the degree, got the good stable job. 

Lynn2000

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Re: young adults learning the hard way - update post #29
« Reply #73 on: March 05, 2013, 11:51:23 AM »
Lynn2000 wrote:

"I think the original story is interesting because, if the scholarship had been obtained, it would have impacted not just the teenager but also his parents--I'm assuming it was a decent amount of money which otherwise his parents had to pay."

The bolded part jumps out at me.  Maybe it's just me, but I never saw any law passed that required a parent to foot the bill for a child's college education.  Sure, it happens all the time, but if my child blew a college scholarship through his own bad decisions, especially after going against or ignoring my advice, I'd have to think long and hard before ponying up the funds to offset it rather than put it right back in his lap to deal with.  Part of learning one's own lessons is dealing with the consequences of those decisions, and so the obvious consequence is that he has to figure out where to come up with the money that the scholarship would otherwise have provided.  If that means he's got to deal with heavier debt to get through school, then that's a life lesson learned and the next time such an opportunity arises I'd bet he'll put in more effort.

I can understand the idea that getting into a good school is extremely important, but at the same time my take on the whole thing is simple.  If my child doesn't put the effort into getting into Harvard including the understanding that outside advice will help his chances, then he probably doesn't belong at Harvard, and the vast majority of people in the world live a full life without a Harvard degree so it's not a life-or-death decision.

Virg

Oh, I agree with you. That's why I stated what my assumption was, in case the OP wanted to clarify that it wasn't correct. (Though I understand we aren't exclusively discussing the story in the OP.) For a parent who had decided they would pay for their child's college, but was scrimping and sacrificing to do so, seeing the kid blow his chances at a big scholarship by being resistant to basic advice would be much harder to accept, I think. The temptation to advise and even insist anyway, despite the possibility of a blow-up and knowing how the kid learns best from experience, would be pretty strong, I think.

In a situation where the scholarship was nice but not necessary; or alternatively, where it was made clear that without the scholarship, the kid would not be attending college full-time because there was no way the parents could afford it on their own, I think it would be almost easier to let the kid fail, and learn from the failure. And I would think the same applies to other situations--like if the kid seems likely to blow a job interview, does the failure mean they'll stay in their parents' basement mooching off them, or just that they'll have to keep their current job which is sufficient pay-wise but not enjoyable to them? I would think the temptation to intervene would be stronger in the former situation, where success would have a direct, tangible impact on the parents.

But then again I don't have kids, so take those thoughts for what they're worth. :)
~Lynn2000

Katana_Geldar

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Re: young adults learning the hard way - update post #29
« Reply #74 on: March 05, 2013, 04:27:15 PM »
There's nothing wrong with paying for a kid's college education, but there is not a parental failure if kids pay for their own. In my case, I was expected to get at least a BA, and on my own dime.

Me too.  I knew at a very young age that college would be totally on my own, but I MUST have it (but that's another whole long story).  I also did not qualify for any grants or scholarships.   It took me 16 years of hard work, 3 jobs at a time, and a breakdown, but I got that blasted Bachelor's degree, and paid for it all.  And it was SO worth it, too.

Along the way I also had to learn everything else about being an independent adult.  We were taught NOTHING at home.  Not how to budget, not how to dress, not how to eat properly, not how to get or maintain a healthy relationship.  We were well-cared-for kids, but taught nothing whatsoever about being independent adults out in the world.  It was a hard struggle, and probably will never be over, but I did it.  Got the degree, got the good stable job.

A lot of parents and students downunder are probably extremely grateful for HECS/HELP where the government pays the uni for you to attend and you pay them back. But there are other expenses like books.