After publishing my post, “When To Stop Contributing To A 529 Plan,” I felt a sense of emptiness. For years, I had been trying to find a logical way to decide when to stop saving for my children's college education. When I finally figured out the answer to my financial obligation, I lost some purpose.
I’m not sure if I’m going through a mid-life crisis at 47, but I feel like I’m entering an existential crisis as a parent. Once all the financial obligations for your children are met, or you know they will eventually be met, what else is left? Our number one responsibility as parents is to ensure our children’s survival. Once we know they can survive, our purpose for existence declines.
The last time I felt this hollowness was a week after publishing my bestseller, Buy This Not That. It took two years to write and six months to market during a pandemic with screaming children at home. I put so much effort into my book that once it was finally out, I entered a “trough of sorrow” where I felt sad for no longer having an audacious goal to struggle toward.
The previous time I felt this way was in April 2012, the month I left my finance job for good. After 13 years of getting into the office by 6:30 am, I felt weirdly empty that I no longer had to work 60 hours a week. My identity was ripped away with my one decision to negotiate a severance.
A Parent's Financial Obligations To Their Children
Being a parent is one of the toughest jobs you will ever have, maybe even the toughest.
It’s usually only when parents are in their mid-50s or older that they finally get the reprieve of no longer having to take care of their children. They’ve either graduated high school or college and are now on their own. Of course, there is also a growing percentage of parents who help their adult children financially.
But if you’ve focused on your personal finances since a young age, you may find yourself on an accelerated path to fulfilling your financial responsibilities to your children. If so, you might start wondering, “What’s next for me to do?”
Here are the main financial responsibilities parents have for their children. Of course, you don't have to accomplish them all. But if you are a personal finance enthusiast, these are the responsibilities to consider. Further, if you want to achieve FIRE and don't have children yet, these goals may motivate you to get a head start.
1) Rent or own a stable home where a family can stay for years
Routine and stability are important for children. I should know since I moved around every 2-4 years from ages 0 – 14, and look how odd I turned out.
Parents have a responsibility to rent or own a suitable home in a safe neighborhood for their children. Most parents, if they can afford to, buy their primary residence when they have kids because it increases the chances of stability.
When you rent, you are at the mercy of the landlord’s desires. Once you’ve purchased your primary residence, you may long to upgrade to a nicer home as your family size grows.
After a while, you’ll also know more of what you want in a home. As a result, you’ll need to come up with a new down payment and take on a likely larger mortgage. Ultimately, you might find your perfect dream house to raise your kids, which will cost even more money. After all, the best time to own the nicest house you can afford is when your kids are at home.
As a result, you’ve got to come up with even more cash for the down payment. Finally, your financial responsibility is over once you’ve fully paid off your home. This ensures your family will never have to move.
2) Buy one rental property for each child (stretch goal for parents)
To invest for retirement and protect your kids against a cruel world, buy one rental property for each child. If you do, by the time they graduate high school or college, a large part of the property, if not all of it, will be paid off.
These rental properties can act as affordable housing for your children. They can also act as income sources that give them something to do as property managers. If you want your children to live in the same city as you after graduation, these rental properties can act as magnets for them to come home to.
Owning a rental property for each child is one goal real estate investors should have. Hopefully, you also teach your children everything there is to know about rental property investing and management as they grow up.
If you can include your kids in rental property maintenance, by the time they are adults, they should better appreciate the value of hard work and money. My kids are helping with rental property maintenance whenever there is turnover. Inevitability, there will be things to fix and walls to paint.
3) Save up enough in a 529 plan to fully pay for college education
College is debilitatingly expensive, yet it is also important for our children to get good jobs and become financially independent. As a result, saving for college is a must.
The people angriest about the absurd cost of college are likely those with the most student loan debt. This debt forces some graduates to pursue careers they don’t want to pursue, mainly for the money. Meanwhile, student debt can also block graduates from taking on more career and lifestyle risk.
If your children are not above-average intelligence, not particularly hard workers, and are not part of an identity group that gets favorable treatment, it is recommended to save up enough in a 529 plan to fully fund their college education. This way, you are less at the mercy of the gatekeepers.
4) Own a safe and reliable car that’s paid off
Owning a car is a necessity for most families. Without a car, it’s not efficient to pick up and drop off kids at school and for extracurricular activities. My annual car mileage has doubled from 4,000 a year before having kids to 8,000 a year after having kids.
Every parent must own the safest car they can afford while following a car-buying guideline, like my 1/10th rule. The last thing you want to do is get into a terrible accident that causes significant injury, which may have been avoided if you spent more on a safer car.
As a financially responsible parent, your goal is to achieve the highest house-to-car ratio possible—30 or higher is recommended. This way, you maximize your capital towards a potentially appreciating asset while minimizing capital towards a guaranteed depreciating asset.
Not only will you have to spend regularly on maintenance to keep the car safe, but you should pay off your car. It’s suboptimal to take out a loan on a depreciating asset.
5) Earn or save up enough to pay for vacations and summer activities
When school is out, your kids are with you. If you are working full-time, the main solution is to send your kids to summer camp or summer school. These activities will cost thousands of dollars over a three-month summer. A financially responsible parent must have the income and savings to pay for these costs for 15+ years.
Meanwhile, family vacations become more meaningful because they are also educational opportunities for your children. Family vacations are also much more expensive given kids over two have to pay the same price for an airline ticket. Meanwhile, it’s harder/less comfortable to just rent a standard hotel room when you’ve got three or more people.
Hence, one of the biggest challenges for parents is to regularly come up with $10,000+ a year to pay for vacations and activities. Follow my vacation spending guide so you don't overspend on vacation and regret it.
6) Locking down an affordable life insurance policy
Parents with debt who are not financially independent yet should get matching term life insurance policies. At least the primary income earner must get a life insurance policy in case they pass prematurely. You don’t want to be forced to sell assets at an inopportune time or disrupt your financial and personal life in case of a death.
After my wife and I got matching life insurance policies in 2022, we both felt a tremendous amount of relief. My 10-year term policy I took out at 35 in 2012 was expiring. It cost me only $39 a month, but I made the mistake of not getting a 30-year policy because I didn’t predict having my first child in 2017. When I tried to renew in 2019, 2020, and 2021, my quoted cost from USAA was over $400/month!
My wife also had a more expensive policy through USAA, but it was expiring in seven years. It made no sense to have mismatching term life insurance policies since we are equal partners and stay-at-home parents. So we used Policygenius to find us affordable, matching 20-year term life insurance policies with the same death benefit. I got a quote for $130 a month from SBLI with a $750,000 death benefit and took it. Phew.
Please don’t go to the doctor for anything non-life-threatening before applying for life insurance. All doctor visits and treatments will be recorded and reviewed by insurance underwriting. Learn from my mistake of going to a sleep doctor in 2017 before beefing out my life insurance.
7) Getting your estate in order with a revocable living trust
As parents, you don’t want your children to go through expensive probate court to figure out what you own and who gets what. Instead, you need to sit down with an estate planning lawyer to establish a revocable living trust. This way, there is a clear directive regarding how you want your assets to be spent and transferred if you were to die.
A revocable living trust will likely cost you between $2,000 – $5,000 to set up. But the sooner you set it up, the more peace you will feel as a parent. Not only should you set up a revocable living trust, but you should also create a written will, a video will, and a death file to share all your user accounts and passwords.
Give your loved ones the gift of clear instructions and an orderly pass down of assets.
8) Spend as much time with your kids before they leave home
Once all the financial obligations are in progress or met, the most important obligation is spending as much time with your children as possible. This way, you can build a better bond and impart more of your wisdom onto them so they can better launch.
Young kids really don’t care how much money you have or how senior your job title is. They care about spending quality time with mom and dad before they just want to spend time with their friends. This window of quality time will likely last for the first 10-12 years of their lives. After that, your kids will likely want to spend most of their time hanging out with their friends.
The difficulty with this situation is that parents are usually not as wealthy in the first 12 years of a child’s life than they are when their kids are 12-18. By the time parents are ready to give up their careers and spend more time with their kids at 12, it may be too late.
Hence, to minimize regret and disappointment, it may be best for parents to alternate not working during their children’s first five years of life before they attend kindergarten full-time. If alternating being a full-time parent doesn’t work, then at least one parent can take a more flexible job or do part-time consulting.
Let's not miss our small window of opportunity to be with our kids!
The End Of My Parental Financial Obligations Is Nearing
One of the reasons I'm experiencing an existential crisis is that I have only two remaining financial obligations as a parent:
- Pay off two rental properties
- Fully fund my daughter's 529 plan
I will fully fund my daughter's 529 plan within three years, barring a bear market. Paying off the two rental properties will likely take five to ten years. My goal is to complete both obligations before my children graduate high school in 11-13 years, so I'm not overly concerned. Additionally, the mortgage rates on these properties are so low that there's no urgency to pay them off quickly.
Feels Bad Knowing We'll Never Get Our Special Time Back
My biggest concern is realizing my time being a full-time father to my daughter is ending in September 2024. I’m sad she has grown up so quickly. I’m also concerned about how I’m going to fill the void when she is in school for 8+ hours a day with her brother. There’s only so much tennis, pickleball, and writing I can do.
The problem with going all-in on something is that once it’s over, the free time can feel extremely uncomfortable. This impending dread forces me to reinvent myself as a father, like I’m forced to reinvest the proceeds after selling a home for a large gain — not easy.
As a parent, I think it’s good to stay on the ball with all your financial obligations to your family. However, if you get these financial obligations done quickly, you might be left feeling empty as you lose your purpose with each target achieved.
So, perhaps a better parenting strategy is to take your time meeting all your financial responsibilities. This way, you might feel less stressed and enjoy the journey over a longer period of time.
Perhaps The Most Important Parental Obligation Remaining
After writing this post, I feel reassured knowing that I still have a couple of clear financial objectives to complete for my children. Don't you?
However, perhaps the most important parental obligation is to stay as fit and healthy as possible for our children. By doing so, we increase our chances of living to our maximum lifespan.
- Our first goal should be to live long enough to see our children reach adulthood. This way, we can teach them as much as possible before they might need to be independent.
- The second goal is to live until after they graduate from college (if they choose to attend) and secure employment. This will allow us to rest easier knowing they are both educated and employed.
- The final goal is to live long enough to see our children find loving partners. This way, we can leave this world knowing they won't be alone.
As a son who dreads the day his parents will pass, I feel it's my responsibility to help minimize this dread in my own children by living an active, healthy, and purposeful life. Time to get moving!
Tips To Deal With Your Parental Existential Crisis
Dealing with a parental existential crisis after meeting financial obligations is a complex but not uncommon challenge. Here are some strategies to help navigate this transition:
- Redefine your purpose:
- Shift focus from financial goals to personal growth, relationships, health and experiences.
- Explore new ways to contribute to your children's lives beyond financial support.
- Invest in personal development:
- Take up new hobbies or skills you've always wanted to pursue.
- Consider further education, professional development, or therapy.
- Explore mentorship opportunities:
- Share your financial knowledge with others, perhaps through community programs.
- Consider mentoring your children in areas beyond finances.
- Set new goals:
- Establish non-financial objectives for yourself and your family, such as travel, music, sports, business.
- Consider philanthropic goals or ways to give back to your community.
- Practice mindfulness and gratitude:
- Reflect on your achievements and practice gratitude for your current situation.
- Consider meditation or journaling to process your emotions, as you may be experiencing money dysmorphia, an unhealthy obsession with money.
- Redefine your role as a parent:
- Focus on being a guide and emotional support for your children as they grow.
- Explore ways to teach life skills beyond financial management.
- Plan for the future:
- Consider long-term family goals, like multi-generational wealth planning or family business ventures.
- Discuss and plan for your children's adult lives and your potential role as a grandparent.
This transition is an opportunity for growth and redefinition. It's normal to feel unsettled, but with time and intention, you can find new purpose and fulfillment in your role as a parent.
Related: Feeling Poor As A Child May Help Them Grow Rich In Many Ways
Reader Questions and Suggestions
What are some other financial obligations parents have to their children? Perhaps this post highlights too many parental obligations, which may leave parents feeling overly stressed. If so, which are the 3-5 main financial obligations parents should meet before their children leave home?
If you are a stay-at-home parent, did you feel dread knowing you'll never get to spend all day with your children again once they attend school full-time? How did you overcome the hollow feeling inside once your kids started going to school full-time?
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I am a single dad to one tween and one of the main reasons I continue to work is to make sure he will be ok in the future. I have not saved up anything for a college fund. While I hope he goes to college and does well, that’s not as important to me as his search for happiness. If he decides to go to University, I can pay for it without stressing about it. He has expressed a desire to be in business like me, so I hope I can teach him what I do so he can take over when the time comes. Also, realistically speaking, I have accumulated enough so that he will be ok just collecting dividends but he doesn’t know that. And I will leave the money in an Incentive Trust so there is a motivation to work in order to collect.
As for the “crisis” you mentioned, I probably felt something similar once I saved up more than enough for retirement. But now that I am on my 50’s, single, and soon to be relatively free of parental responsibilities, I am looking forward to seeing and experiencing a lot of things I haven’t had the chance to do. I happen to look much younger than my age and am very fit, so I can enjoy my life just like when I was in my 30’s. I will travel the world, I will date lots of beautiful women, and go on whatever adventure I feel like taking on. Which is similar to what I used to do prior to getting married. Life, for me, is meant to be enjoyed and I will do that to the best of my abilities until I can’t anymore!
It seems as if there is a lot of time when they go to school, but that time goes by quick.
Our kids are 10 now, and I work 10-12hrs/week and my spouse 32hrs/week. Those 12hrs I work give me a sense of purpose/meaning, and by the time I’ve worked out, meditated, read, etc. the kids are ready to be picked up. I now can’t imagine working full time and realized how lucky I got that my last full time job was very flexible and gave me a lot of time with the family.
Just because your dtr is going to school, doesn’t mean your life isn’t still going to be full. Enjoy the down time.
Our thoughts are what leads to most our suffering. Maybe rather than thinking it as an existential crisis, consider seeing it as an opportunity for discovery. Plus, many times we go from full time job to another full time position like parenting and we aren’t use to slowing down and just learning to be still and silent…that was and sometimes still is my biggest challenge.
We are recent empty nesters who absolutely loved raising our three boys but that moment is now over. I would add that in addition to keeping yourself healthy and fit, keeping yourself engaged and finding meaningful ways to spend your time is also a gift to your children.
Our boys know we’re having a blast building our new life and they don’t have to worry about us being sad. It’s the next step of being a role model. Last fall we were life long learners on Semester at Sea and I fell in love with all the college students. This lead to the decision for us to rent out our SF home and relocate to DC so that I can pursue a Masters degree so that I can work on a college campus with students. Many adventures in our future!
Great point about keeping busy and having fun so our kids don’t worry about us. Doing the semester at Sea sounds awesome! I always wanted to do that while I was in college. But I still had fun being an exchange student in China in 1997 for six months. What a blast.
“Our boys know we’re having a blast building our new life and they don’t have to worry about us being sad.”
This, and being healthy, is one of the best gifts we can give our kids.
I felt the same way once we reached FI and our boys secured high-wage incomes in bullish industries (aerospace & defense). To spread our impact, we expanded our “circle” to include our boys, nieces & nephews. Then we stole a page out of the military’s inkblot strategy: secure areas, or “inkblots”, across the region (our family), hoping to expand our impact outward from them. The goal: secure the entire region (our family) by linking (connecting all the members) to the protected bases and making a positive impact as their families grow. Our vehicle of choice is a Family Limited Partnership, giving equal voting rights to each member on how the partnership is run. My wife & I act as “chairmen” and final authority. We hold annual “board meetings” to orchestrate the investments, determine how much money can be distributed as “bonuses”, and, most importantly, enjoy a weekend together as a family. It’s been a huge learning experience for all with a tremendous impact on everyone involved, not just financially. So many great ideas and the youthful motivation is ceaseless. Even those who do not actively participate appreciate the additional money in their pockets and will do more so as the partnership’s portfolio grows over time. If we all do these kinds of things over time, you can dream of how the inkblot will spread.
Your level of sincere self-disclosure is really beautiful Sam.
so interesting we group of wealth accumulators are. i have built a modest 7+ mill portfolio. no debt. house paid off. we have told our kids that if they have kids we will pay for their college.that’s our main financial gift to them. and we would probably help with down payments on their first house when they get there. they are 26/23.
i have found i have absolutely no interest owning an expensive car or boat. or buying multiple residences. many of us built some wealth because we simply don’t get a lot of enjoyment out of depreciating assets like others do. just not something I value. just free time and travel. riding a bmw convertible to my golf club would only be to be seen, try to send a message that i’m important. but that wouldn’t be authentic and i would feel fake. that isn’t what makes a person.
Andy, I’m curious. Where did the big portfolio come from?
Have you ever heard of money dysmorphia? If so, would be cool to see an article about that.
Sure! I love for you to help get it started by sharing that you know and your thoughts. It’s great to have the community contribute.
Do you suffer from any of these symptoms?
Inability to Manage Finances
Excessive Risk Taking
Compulsive Spending
Excessive Focus on Accumulating Wealth
If you could share something about yourself, and how you are tackling the challenges of raising kids, I’d love to hear it. Maybe we can help you. Best
Hi Sam, thanks for the response. I meant more in the context of having an insecurity of one’s finances even when one has a solid financial footing. I understand that “solid financial footing,” is very subjective, however I begin to wonder at a certain point how much is enough while still thinking you don’t have enough? I’ve heard that some children who were raised through the Great Depression suffered with this after their families experienced financial hardship and trauma at a young age. Some later accumulated great wealth, but were still afraid to spend on anything and worked themselves to death and old age to ensure they’d never suffer financially again. Instead of being on the “not enough” spectrum, what if some of us have more than enough, but always think and worry about money?
I think everybody has some level of insecurity with their finances b/c the world is ultra-competitive and uncertain, e.g. the pandemic. As parents, it’s our responsibility to worry and plan for the future.
How many kids do you have and how are you dealing with the financial obligations of being a parent? Please share something about yourself so I can better understand where you are coming from.
If you are feeling too afraid to spend money, you may enjoy this post: The Best Age To Start Decumulating Your Wealth.
I was hesitant to spend a large amount of money on a forever home in 2023, but I pulled the trigger. I didn’t want to just accumulate wealth and not enjoy it. So far, it’s been a good decision, but I’ve had to get used to added financial responsibility and stress the first six months. How about you? Don’t be shy!
I dunno, maybe I’m too much of an optimist, but I don’t see the world much more uncertain than past times. If anything, I feel like more of humanity is living better off now than ever. (Not to take away from those that still suffer). I’d also argue that it is not the parent’s responsibility to “worry” about the future. Coming at it with that lens may just incite fear/anxiety in our children that the world is a scary, competitive, fearful place. Hard it is, but instilling confidence through planning well, and that they can handle what comes their way is more of the way I look at it.
I have one child. Planning on 2nd soon. We are in mid 30’s with about $1.8M net worth which includes two homes (one live in, one rental). No debt and two 6 figure plus incomes in a modest cost of living area (Sacramento). However, I am still stingy as hell… Never want to spend on myself for anything, still driving a 12 year old vehicle. I don’t even buy myself new clothes. I just keep wearing socks and underwear that are torn with holes. At some point I just wonder, how much of this is financial dysmorphia. I clearly have enough to buy new socks, but just keep trying to be extremely frugal to stack those investments. I think my wife now feels guilty for buying things for herself because she knows how frugal I am (even though I don’t say or imply anything). I dunno… kinda rambling now.
Thanks for sharing that article. That was very insightful!
Thanks for sharing! I think you should definitely be able to buy some new socks. Hah.
Maybe you and your wife really enjoy your jobs and are happy to work for a long time? If so, then you guys are good to go.
At the age of 34, I was no longer Happy working in finance so I left. But if I was happy, then I would most certainly have continued to work because the pay was good.
The other thing you or your wife may wonder is whether one or both of you continuing to work with two little children is ideal. My wife didn’t want to go back to work after having two children, as a result, I felt the need to earn and provide more to provide this life for her.
You won’t feel that kind of financial pressure if she goes back to her six-figure job after her maternity leave is over.
Congrats on number two! Maybe you can come back to me when the second at six months old and share how you and your wife feel. And whether $1.8 million is enough. Thanks
Really enjoyed this article. You do a really good job of putting things into perspective with kids.
Why is #3 a thing? When did it become required for parents to pay for college or even for kids to go to college?
This is one of those expenses that culture says we should have but in reality many people don’t need. Not only is it expensive but stressful!
Giving our kids financial literacy and starting the compound interest climb with investment accounts for our kids early seems to be a wiser move financially.
With a 529 the kids likely are burdened with the thought that college is expected (cause parents saved for it) and therefore the kids feel they “have to” go.
Probably due to the correlation with college education, income, and the ability to become financially independent from one’s parents.
I don’t want to risk break the chain of prosperity through less education. I grew up where it was expected of me to go to college, there was not even an option not to go.
I enjoy the challenge of saving and investing for something specific. So there is stress, but it’s positive stress for people I love.
“Giving our kids financial literacy and starting the compound interest climb with investment accounts for our kids early seems to be a wiser move financially.” – This is most certainly going to happen, with or without college.
I think it’s actually cool you won’t be sending your kids to college. How old are they and what do they think about it?
Our kids are high school graduates and well on their way to successful careers and financial stability/independence without going to college.
We educated them early that college isn’t required (depending on career) but if they want to go they can get a good education at a price that won’t put them in debt.
We started investments for them early in life that now they could “choose” to use for education if they wanted, or a house, or a family, etc.
They love having the option without the pressure from us that they have to go.
It was funny watching the horrified expressions on older generations when our then teen-kids would say “I’m not going to college”!
Count me in the boat of having zero preference if my boys go to college or not. That will be entirely up to them. But I have 529 plans for each of them with plans to have $100K each by the time they’re 18. That’s a small amount compared to Sam, but if there do go to college it will help get the ball rolling for them. If they opt not to go to college, they’ll be able to rollover $35K each into Roth IRAs, and then have $65K to put towards trade school, studying abroad, or other education. My sincere hope, however, is that by the time they’re 18 (another 12-14 years), the 529 stipulations will continue to slacken and they’ll be able to use the money to fund entrepreneurial ventures.
Sam, what do you think the odds of that ever happening are?
Perhaps 20%. I’ve been hoping college will be more affordable since 1999. It is only gotten more on affordable and getting jobs seems to be more about who you know as well. I’m not taking any chances. I figure, if my kids have kids, then there are 529 plans can get divided up easily.
I think having the financial obligations out of the way early is a gift to yourself. Rather than being burdened by the distraction of making more money, you can be blessed by the ability to be present with your kids. The challenge is not coming up with additional goals out of habit, and just soaking in the rewards.
That’s a good way to look at things. Although, a parent can be present and still consciously save and invest for their kids and meet their financial obligations too.
Sam, very timely post for me personally.
Next week our only child is (finally…. ) leaving the nest for graduate school. We checked off all but one of your suggested parent financial responsibilities (except #2, rightly or wrongly, we never wanted to be landlords)…. I have no regrets at all on the journey thus far, especially exposing her to many wonderful vacations, cultures and experiences. She is an amazing young adult and will do great on her own.
My wife and I realize that we will need to “reinvent” our daily lives – I’m confident that we can do it successfully and look forward to the many years ahead. Your suggestions on path forward are affirming.
Time goes by more quickly every year, maximize your time and enjoyment with yours!
Congrats! Although you say “finally,” doesn’t it feel like the time flew by? I’m struggling to comprehend how fast my kids are growing up. I’m also coming to accept that I’m getting older and looking older.
Life goes by way too fast! The window of opportunity is smaller than we think!
Sam, I poorly communicated my thoughts. It was not meant as “Finally – couldn’t wait!”, but was meant as “Finally – we knew it would happen someday. And although it is a normal part of becoming an adult and is a positive step for her, we will severely miss her daily interactions.”
Yes, looking back the time does seem to have flown by….. she grew up and we grew older.
Thanks,
LandS
With so much of their life now taken care of, what challenges are available for them to endure and overcome so that they grow into successful, resilient adults?
Serious question. The hard times I had earning these things gave me respect for them. I don’t know what I would be like if they were provided.
True. But I think a safe home and a safe car are non-negotiable.
Things such as saving enough for college and owning rental properties for each child are more insurance policies, not givens.
What are some financial obligations you have as a parent you are working on?
529 with extra that can roll into a Roth. Rental property is not a bad idea. My friend in college had parents that bought a home she could stay in for free as long as she managed the property and 4 other roommates.
Both my husband and I came from lower middle income class families, and we had to take on student loan (in addition to PT jobs) to pay for our colleges and professional schools. Fortunately, it was not much and we were able to pay everything off in the first year we were married at age of 30. We have two grown kids in their 20s. When they were deciding where to attend colleges, we strongly encouraged them to attend UC Berkeley and not private colleges in the east coast given the majors (engineering and business) they chose, and we had paid for their 4 years of tuition/room/board. It costed us about $260K for two kids at UCB, and with money we had saved for them not attending private pricy colleges, we are now paying for one of the kids attending graduate school which is about $260K for two years.
Not having student debt is one of the great gifts you can gift to your children, and they can start their professional lives without the burden of big debt!
Congrats for BOTH getting in Berkeley. I hear it’s nearly impossible today with tens of thousands of applicants a year.
$260K for two years of graduate school is a lot. What is it they are studying?
My parents cut me off after college. I was on my own to pay for grad school, which I did by going PT and getting my employer to pay 80% of it.
Harvard MBA.
Yes, it is a lot of money, and hopefully the degree would offer new opportunity when he graduate next year. In my view, it is a great way to reduce our estate since it is currently exceeded the exemption amount.
I strongly believe you did it the right way ( I would have done the same) by going to MBA program part time and continue to work full time to minimize the opportunity costs!
Nice. If you and your husband have an estate worth over $27.2 million, then I don’t think money is an issue when spending on education. I would go all out as it’s tough to spend down that wealth.
May I ask how you and your husband were able to? I’m at such wealth and what age are y’all? Thanks.
We are in early 60s and my husband is still working and we have continued to save.
Frankly, it has been challenging to find ways to spend down as we live a minimalist lifestyle.
Cool. What is it that your husband does? He must really love his job given he doesn’t need to work.
I decided to jump off the work train with a $3 million net worth in 2012. It was probably 5-6 years too early. But I don’t know if I would be motivated to continue working, especially over the age of 60, with a $27+ million net worth.
Well, he has a high paying job and he has his good days and bad days like everyone.
I have suffered from financial insecurity after I lost my high paying job (many my ex-colleagues got force out as well due to our age being over 55-65) so I followed your advice to retire early and have my spouse continues to work.
Well if you ask me, personally I’m influenced by happiness studies as well as mindfulness (MBSR) and random Stoic and Tao Te Ching quotes.
Process over outcome. Like activities where you enjoy the doing and it isn’t just a burden.
This doesn’t have to exclude having goals. Like the activity could nominally have a desired goal (e.g. a certain kind of work or business) but really, deep inside, you just do it because you enjoy the work itself. This is probably why a lot of boomers still work.
You can also cultivate enjoyment of something you used to hate. E.g. I’m learning math properly now after years of being afraid of it. Over time I’ve begun to enjoy the process more by patience and persistence and asking others for help when needed, so it’s not as scary now.
Also simple things like nice location, surroundings, environment. E.g. I know some people who worked a job that seemed on the outside pretty dull but actually the office was really nice or the job got them to spend time outdoors, so they gained enjoyment that way.
And also the really simple primitive pleasures like nice food, or a nice shower in the morning. I guess that’s where mindfulness comes in.
To me curiosity / discovery is big. This was a big motivator to get into math more. When I first began to understand integration in the theorem of calculus it was genuinely mind blowing. I hope one day to understand on a deep philosophical level the square root of two.
Look ultimately everyone should also have “something to prove”. That might change from one decade to the next, but I think over 10 years it should be consistent. I started out wanting to prove to my parents that I could survive on my own. Then I wanted to prove that I was a “senior software engineer”. At your level, maybe you will want to prove that you can maintain a certain kind of lifestyle or that you can be the first person to do “x” or “y”. But this isn’t obvious for everyone, it can take a long time to find.
Anyway one last thing – I think anything that improves your abilities is generally worthwhile pursuing. This world is not as safe and predictable as it seems. You never know when you need some skill you never anticipated. For this reason I plan to learn a bit about first aid, massage and auto repair.
I understand what you mean about the resulting let down feeling after achieving big goals. It’s ironic in a way, but I completely get it b/c I’ve experienced that too. There’s the initial excitement and exuberance of completing a goal followed by the “now what?” almost restless feeling.
It’s also interesting to compare how we feel about big goals to small ones. I feel like big goals can be easier to focus on over the long term. Because we have more time they can feel more manageable. But having a ton of tiny goals or tasks that need to get done faster can feel way more overwhelming because of their high quantity and short term urgency. But so many productivity “specialists” rave on having small achievable goals vs big broad ones, so what do I know? lol.
I think you’ll settle into your new normal well once the time comes. Sometimes the time leading up to change is way harder than the actual change itself due to our emotions.
I hear you on the existential crises. I thought working part time would be a good balance, but I’m getting sick of it and the ceiling on what I’m allowed to do exacerbates the loss of interest. No time to go back to school right now. My wage was doubled 2 months ago which was kind of shocking, but the returns are questionable because the taxation is high and the terms are outside of the union contract, so who knows how long the party will last.
Feels like I’m already doing all the recommended things to keep going but somehow I still feel kind of bored.
Interesting list. Generous on obligations, but most people can’t do much of this list unless they are affluent. Not a criticism just observation.
I have two in college and my obligations continue to diminish. It has not been a crisis for me, but a source of satisfaction after almost 20 years of worry and stress. I half seriously joke that I can now die and it won’t be a disaster.
I agree with your list regarding actions to take to avoid the existential crisis and I did most of them, which is probably why I am happy. Good advice, but definitely geared to the well-heeled.
As far as living to see your children married (assume you mean that when you say “find a loving partner”) so many don’t plan to get married and now find alternative paths to intimacy these days I’m not convinced a parent should have as a goal an outcome they can’t control, or may not even be a good thing given the numerous unhappy marriages in the world.
I love your thought-provoking columns, even when I don’t agree. Always forces me to examine my own assumptions.
” It has not been a crisis for me, but a source of satisfaction after almost 20 years of worry and stress. I half seriously joke that I can now die and it won’t be a disaster.”
Love to hear this! I hope I feel the same, and I get you on the joke! Our kids’ survival are paramount, so it’s also dangerous to wrap up our entire identities in our children. Which is part of the reason WHY working is beneficial, as it provides a balance.
Ah hah! Epiphany moment for me on one reason why I’ve been itching to go back to work and stay employed and part of a work community. Too much of my effort has been focused on being a dad since 2017. I need to diversify.
I say ALL but one of these parental obligations are doable for most families, except for buying one rental property for each child. Stretch goals are fun, but they are stressful too.
BTW, I didn’t write “married.” I wrote “loving partner.” Or did I not?
In Pennsylvania, probate is fairly simple, so one doesn’t really need a revocable living trust if one doesn’t have too many non-probate assets, which is the case for us. We did a testamentary trust instead. We’ve located and completed every Transfer on Death form for every account. This is of relevance since we have young kids and my wife’s health is not good. When the first child turns 18, we may change this, but we have time. Also, I have a legal plan through my work so all of this was free, and even if a trust had been included, it would have been free.