13 Comments

  1. I still have those “discussions”. Usually with people who are not oldsters, but even then, sometimes with others in the AARP set. The truth is, there is no one right answer for everyone. So much of what is right for an individual, what will make them comfortable and happy, is tied up in who we are, what our experience is, and what we think we “know” to be true. I’ve really given up trying to convince people that my little window of perspective is the right one. We discuss what our philosophies are, then let the other folks draw their own conclusions.

    On the issue of life insurance, both Mrs. Oldster and I own a little Whole Life, and more term. If we are lucky, the term will lapse and the Whole will cover its own premiums. I also bought a policy for my daughter when she was born. We can double the coverage when she is 19, and I plan to. It’ll be one more piece of her financial puzzle that she’ll need to understand, but not worry about. If she wants to keep it after she hits her 30s, that will be her decision. But if, like her mother, she is constantly fighting off one life threatening thing after another, she’ll have some insurance as a backstop.

  2. I get your dad. I am a slightly early retired engineer and now a personal finance blogger. I helped manage a hundred million dollar endowment fund as part of my pre-retirement day job but I pay fees to have my retirement portfolio managed by others. I just don’t like doing it. I know how to do it but I don’t want to.

  3. I got a copy of Bogleheads for my (newly retired) FIL and he calculated how much his (now former) Edward Jones guy was costing him each year over Vanguard index funds. $10K. Per Year. That’s >3 online classes my MIL would have to teach to make up for that. All of a sudden that $200 donation to my FIL’s favorite charity didn’t seem like such a big thing. It helps that FIL was an accountant! (He just hadn’t really thought about fees before.)

  4. Carroll

    “[insurance is] a system where you could pay a lot and get nothing in return.”

    I have also talked with people who’ve said something like this. I try to explain that when you buy insurance, you are transferring risk to the insurance company — the risk that something bad may happen. So, what you get in return for your premiums is relief from the risk of some bad event causing you financial hardship.

    Sometimes this explanation helps, but sometimes not. Risk is a fuzzy concept. So, a lot of people have a hard time wrapping their heads around the idea.

    Thanks for another interesting post!

    • Thanks for the compliment, Carroll! It seems to be a sentiment leftover from the time when whole life insurance was popular. He doesn’t carry any (I’m not sure he ever did). My mom had a policy from when she was little that she cashed out with very little fanfare. Sometimes I think he enjoys playing Devil’s advocate more than anything.

  5. This is so interesting. We used to use the same financial planner as my father until we woke up and realized we were paying outrageous fees. We’re with Vanguard now, my dad is still with the other guy. We haven’t really discussed it except for me to say “you know that guy is charging you outrageous fees”. It was difficult and strange for me to make the decision to switch though because it was one of the first times in my adult life that my decision was based on my own research instead of my dad’s advice.

    • I do know the fees are much higher than Vanguard, but he did run the numbers and seems comfortable with it. He’s very much of the mentality that he would rather have someone else deal with it. He always kept an accountant when he ran his business. I think he actually knew his own numbers and many of the laws just as well (if not better), but that’s just how he is.

      The only hope would be to get my mom on board with Vanguard. She’s the type of person who will drive an extra 5-10 miles to save $5 at the grocery store 😉

  6. Oooh yes I have had some of the best money conversations with my Dad, although I think we have actually been on the same page on most things. I remember the first time we talked about MERs and he was like “Charging 1-2% is highway robbery!” and I was like “Cool, I guess Pops is into index funds then.”

    That said, he is more traditional in other ways. He is big on real estate, even though this doesn’t financially make sense anymore in most large cities in Canada and I have told him that. But these disagreements have taught me a lot about the emotions tied to financial decisions. I think owning a home was something he what he wanted to give our family. It meant safety, security, stability to him and I think it still does. So even though I live in a renter’s market and do not value home ownership in the same way he does, these conversations have made me reflect on how and why we make the financial decisions we do. And I think that’s super valuable!

  7. I can’t really seem to get anyone else i know on board with FIRE… they have spouses and families and are content living their own lives just as they are… I figured there was at least one person i knew out there who was just waiting to know this world existed… haven’t found them yet… 🙂

    • It is so hard to cultivate this community in real life in my experience. I have to get better at going to meetups from the PF/FIRE community!

  8. Two of the money/money-ish podcasts I listen to the most diligently are diametrically opposed to what I believe in. I learn a lot from their perspective and their research. I recommend lots of folks do this. Many people I find disagreeable know a ton of stuff I don’t yet.

  9. I have had these exact money debates with my parents! My parent thinks we’re crazy to not have any life insurance on me, to which my husband tells them that I am too baller and he’ll be fine (financially) if something happens to me. They also really like whole life insurance. I just don’t talk to them about life insurance 😉

    My parents have only ever invested in their business, cash, and real estate. One parent doesn’t like stocks. This means they’re obsessed with the fact that we haven’t paid off our mortgage yet. I find it minorly annoying because they don’t believe that “having more liquid” or “the stock market returns more than our mortgage” are reasonable reasons to take our current position.

    I find debates with differing philosophies to work the best when you can actually agree to disagree, respecting the other’s points. My parents and I don’t do the best job of that since we’re all very stubborn.

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