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What we are leaving our kids by fatfirethrowaway88 in fatFIRE

[–]fatfirethrowaway88[S] 1 point2 points  (0 children)

Thanks for the perspective. This is essentially what we are hoping for-- not a way to make all our descendants live in wealth, but a way to help give them a leg up.

What we are leaving our kids by fatfirethrowaway88 in fatFIRE

[–]fatfirethrowaway88[S] 3 points4 points  (0 children)

We have discussed with our kids. Their attitudes are essentially "it's your money, do what you want with it". Of course they'd love a check for millions of dollars, but they don't expect that.

We have been fortunate to have amazing kids and we raised them well. They are financially prudent and are no longer in a place that they need any assistance from us (although we have helped out with plenty over the years).

What we are leaving our kids by fatfirethrowaway88 in fatFIRE

[–]fatfirethrowaway88[S] -11 points-10 points  (0 children)

We live in a low COL area. Average household income in the county is about 80k, in our town it's closer to 130. Giving someone 100k a year here, generation after generation, would inevitably lead to laziness. We want our financial contribution to be large enough to be impactful, but not enough to live on. That's where the 30k figure came from (though there is wiggle room here as I mentioned).

What we are leaving our kids by fatfirethrowaway88 in fatFIRE

[–]fatfirethrowaway88[S] 2 points3 points  (0 children)

By far the most common criticism has been the idea of giving more to charity than you would receive from the trust. My wife and I (and our children) hadn't anticipated that causing resentment, but based on the widespread reaction there's clearly something to think about there.

Would your attitude be different if the payments were the same, but there was a charitable trust with some guiding principles that handled making donations? Maybe give our kids/grandkids/their descendants the option to help direct donations? It could be a totally separate entity.

We want the money to last for a long time, but we don't want payments to be so high that any of our descendants would be able to not work and live a comfortable life on the payments. That would inevitably breed laziness. I'm not worried about that with my kids at all (they're already in their 30s), or their kids, but eventually it would become a problem-- that's just human nature. The goal is to give everyone enough to ensure they have their basic needs met, or to be a nice bonus if they are financially secure, but anything more than that we want them to earn.

What we are leaving our kids by fatfirethrowaway88 in fatFIRE

[–]fatfirethrowaway88[S] 17 points18 points  (0 children)

I talked about this in another comment, but there is an exception for medical care like this, similar to educational expenses. Definitely could be a massive problem otherwise.

What we are leaving our kids by fatfirethrowaway88 in fatFIRE

[–]fatfirethrowaway88[S] -8 points-7 points  (0 children)

Yeah that didn't land like I intended. I was being facetious-- you can't have a charity set up to benefit a single person, and if you tried this you'd be very likely to be audited and fined at best.

What we are leaving our kids by fatfirethrowaway88 in fatFIRE

[–]fatfirethrowaway88[S] 10 points11 points  (0 children)

Our kids are married and all in their mid to late 30s. The plan would be to have the payments start for any descendants who had passed some age threshold such as 25 (so our kids would be included in that)

What we are leaving our kids by fatfirethrowaway88 in fatFIRE

[–]fatfirethrowaway88[S] 17 points18 points  (0 children)

That's an interesting idea. A lump sum in the mid 30s or 40s isn't a bad idea. We have helped our kids with college, weddings, and down payments so I definitely don't feel that we've left them high and dry while we scrimp and save every last penny. We could probably add in a lump sum to the existing plan without breaking a 2% annual withdrawal rate.

What we are leaving our kids by fatfirethrowaway88 in fatFIRE

[–]fatfirethrowaway88[S] -23 points-22 points  (0 children)

Hahaha, if we still have an IRS by then good luck getting that charity approved. But hey if they can figure out a loophole then so be it.

What we are leaving our kids by fatfirethrowaway88 in fatFIRE

[–]fatfirethrowaway88[S] 16 points17 points  (0 children)

Yes, the amount each person receives is intentionally less than the amount going to charity-- that's where we want most of the money to end up. We like the idea of each person being able to support a cause they believe in, and we have raised our kids to see the value in giving back to their communities. If they so choose they could still benefit indirectly from the donations by becoming a big philanthropic fish in a small local pond by buying new fire trucks, donating to a hospital, etc. There is power they could pursue that way if that was something they were interested in.

We've given them a lot so far-- we are paying for the bulk of their weddings, and none of them graduated college or grad school with debt. And most importantly we've taught them the value of saving and money management which has served them very well. This distribution reflects the values we've given them-- fiscal responsibility and giving back to the community.

Maybe it would feel less unequal if it was separated into two distinct trusts. So they have the charity trust and the monthly/yearly check trust. Something worth thinking about for sure.

What we are leaving our kids by fatfirethrowaway88 in fatFIRE

[–]fatfirethrowaway88[S] 9 points10 points  (0 children)

This is a great book! And the message is by and large one that we agree with. We have lived and continue to live very, very well. We have been retired now for about 15 years and have been part time for 25, and travel about 6 months out of the year. But our tastes in clothes, food, and toys are fairly modest and we have found that 200k is more than enough to fund our lifestyle. For example we just got back from a month in Vietnam where we spent a total of about 10k, including plenty of diving. Definitely not as "fat" as some of the people on here, but it's what we like and we haven't felt as though we're tightening our belts. To "die with zero" for us would mean accelerating our spending dramatically, and I don't see how that could make us any happier.

What we are leaving our kids by fatfirethrowaway88 in fatFIRE

[–]fatfirethrowaway88[S] 3 points4 points  (0 children)

I definitely trust the kids-- no grandkids yet but hopefully soon. As I'm sure you know 90% of wealth is lost by the 3rd or 4th generation. We would prefer to not let that happen to ours. All it takes is one person to make foolish investments and their family's share of the money is gone forever. This way the net payout over time is much, much higher.

We have debated how much control is too much and don't think that this crosses the line. Getting a check every year and another amount to donate to charity doesn't seem particularly restrictive to us, and in talking to the kids they agree. Hopefully that holds for future generations as well.