{ in·deed·a·bly }

adverb: to competently express interest, surprise, disbelief, or contempt

Filiality

“Your parent requests one of your kidneys to save their life. What do you do?

Does your answer change if that request for a life-saving gift is for the financial equivalent of parting with a kidney?”

This is a thought experiment in the style of those proposed by SavingNinja. The one thing asked of participants is for a stream of consciousness outpouring of thoughts rather than a carefully polished article. Here goes…

Privilege of parenthood

One of the great privileges of parenthood is that we each get to fuck up our children in our own unique special way!

Parents are obliged to adequately feed, clothe, house, care for, and supervise their children. They mightn’t like it, or their kids for that matter, but the accountability remains theirs regardless.

There are more than a few laws that collectively define the extent of those parental obligations, as well as what constitutes abandonment, abuse, and parental neglect.

Some people define adulthood as being the point at which you no longer get rewarded for effort.

For mine, adulthood starts at the point where you have to fend for yourself.

Graduates from the school of hard knocks may become self-sufficient by necessity in their early teens.

At the other end of the spectrum those fabled “trust fund babies”, perpetual students, and customers of the Bank of Mum & Dad may never develop into fully functional financial adults.

The law takes the view that once a child comes of age, they are responsible for themselves.

Legally free to succeed. To fail. Sleep with who they want. Marry who they want. Wear purple hair or a mohawk if they want. Or to join a cult of folks dreaming about living a financially independent life.

The parent’s job is done.

My understanding had been that from that point onwards, all bets are off when it comes to an adult child’s relationship with their parents.

Hence the implied incentive to be nice to your kids: they will choose your nursing home!

Extra, extra, read all about it!

I recently read an article about an elderly father who sued his estranged adult son for financial support. The father was apparently broke, the son a successful white-collar professional.

How could this be possible?

Do adult children have a legal responsibility to care for, support, or even acknowledge the existence of their parents?

My understanding was this constituted a preference, not a right.

Therefore I was surprised to learn that such a law may exist, providing a basis for legal claims of parental support.

The case referred to in the article occurred in Bangladesh, where the father was able to seek recourse under their Parents Maintenance Act.

Parental maintenance

A quick Google search returned a multitude of similar laws setting out the filial obligations of children to financially provide for parents who could not support themselves.

Countries with parental maintenance laws included Bangladesh, China, India, Singapore, Germany and even many jurisdictions in the United States!

While these laws may appear on the books in some Western countries, to date they are rarely enforced. It is a different story in much of Asia.

These laws follow a broadly similar pattern:

  • Once a parent reaches an arbitrary age, they can demonstrate to a court or tribunal that they are unable to adequately support themselves.
  • Such a petition could be made by the parent themselves or submitted on their behalf by a relative or caregiver.
  • If the authorities agree, then the parent is able to claim maintenance from their adult children.
  • The amount of maintenance levied is determined based upon criteria including financial need, earning capacity, expenses incurred, and health of both parent and children.
  • The maintenance orders are enforced and administered in much the same manner as spousal or child support orders.

In this context, the parental maintenance burden is the same regardless of whether a child was natural born, adopted, a step-child, or even illegitimate.

Under the Bangladeshi and Indian laws, the parental maintenance obligations extend to adult grandchildren, in the event that the elderly person’s own children are dead or unable to provide for them!

Stray dog. Image credit: kirkandmimi.

In need of assistance. Image credit: kirkandmimi.

Sub-optimal parenting

What if a parent had tortured, raped, abused… or simply just been a constant embarrassment their children?

Squandered their future inheritance?

Crushed their hopes and dreams?

Does it even matter?

The only way a person can escape a parental maintenance order is to either:

  • demonstrate their own financial hardship

or

  • prove that they were abandoned, abused, or neglected when they were young.

Think about that for a second.

If you were abused at home while a toddler, how could you prove it decades later to the satisfaction of a court of law?

Sometimes even that would not be enough. According to the Financial Times, a German court ruled in 2010:

“parents were entitled to the support of their children even in cases where, because of illness, they had been unable to provide care”

The penalties for failing to honour these parental maintenance orders include fines and jail time.

Punctured hopes…

Even in the absence of laws that compel us to ensure our elderly loved ones are adequately cared for, I would like to believe that most people would choose do the right thing regardless.

From a financial perspective, what might that look like?

The University of Kent publishes a dataset that detailed English nursing home and residential care home fees in 2017/18. The results make children’s nursery fees looking reasonable!

For a person aged 65 or over, with no major health issues, the median private residential care home bed costs £629 per week, or £32,708 per year.

Should the elderly person require the increased care offered by a nursing home that median price increases to £849 per week, or £44,148 per year.

Those eye-wateringly high prices would certainly put a dent in the financial plans of most people.

Even more alarming: it is an open-ended commitment.

One of my grandmothers lived for more than 9 years in a combination of residential care and nursing homes. We used geographic arbitrage to accommodate her in a more reasonably priced regional facility, but the costs were not insignificant.

Few Financially Independent folks would be able to absorb costs of this nature for long, without feeling the need to generate some extra income.

… and ruptured dreams

Not all potential parental related costs involve maintenance or care homes. Long term health issues can also generate significant outgoings.

For example, my father underwent a genetic test to determine his eligibility for an expensive chemotherapy treatment.

A favourable result meant he received the drug for free.

An unfavourable outcome would have seen the chemo accompanied by a £6,500 bill. Per treatment. Every fortnight.

Unfortunately these kinds of costs would prove fatal to all but the fattest of early retirements.

Beginning of a new normal?

There is a common theme of respecting your elders that runs through many cultures.

The fact that so many countries have enshrined recourse to parental maintenance in their laws indicate that level of respect varies considerably.

The overarching legal principle appears to be that if a family can financially provide for their own, then they should do so.

Court rulings like those in Germany and Bangladesh suggest that cash strapped governments are becoming less willing to assume the burden when an elderly person’s family fails to step up.

Plans deferred or abandoned

In an ideal world our parents and grandparents would have their acts together.

Be financially self-sufficient.

Live in a fully paid off house they own.

Have accumulated a decent nest egg. Which can be sold down if necessary to fund their care requirements in later life.

However through varying combinations of bad choices, bad luck, and bad management; a great many people barely have enough to get by while they are still working full time.

Things get tougher still once they retire. Or get retired.

How would you react if your parents or grandparents needed a major financial helping hand?

What if that assistance commitment was ongoing, rather than a case of “one and done”?

This is a topic that gets glossed over in Financial Independence literature.

Much like the costs of chronic long term illness or incurring major property repairs, the common response is to embrace the approach of an optimistic ostrich. Work on the assumption that these sorts of things only happen to other people.

In many cases that approach might even work out.

On the off chance that you may not end up being one of the lucky ones,  take a moment to consider how having a loved one who requires non-trivial amounts of your assistance, your money, or your time may impact your plans.

Sometimes being a responsible adult is no fun at all.

Sometimes real life involves making tough choices.

Sometimes there are only bad options.

Would you tell your loved one that their hour of need came at an inconvenient time?

That your money was destined for other things?

Or would you indefinitely postpone that globally nomadic existence?

Trade living “the good life” of early retirement, somewhere sunny and warm on the Med, for funding (or even performing) the role of a full time care giver?

Remain in, or return to, the workforce to finance your filial duties?

This is one topic that can’t be readily dismissed with easy answers and empty promises.


References


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10 Comments

  1. TheFIREShrink 6 March 2019

    Hi Indeedably,
    This is a really important topic, and you’re right that it seems to be mainly glossed over by the mainstream FI literature and blogs. I’ve touched on the topic before in my blog where I covered how crap people are at projecting their own life expectancy and the costs of later-life care. People seem to run their SWR predictions not accommodating for inflation of costs secondary to care.
    People avoid thinking about it because it’s uncomfortable. No-one wants to picture themselves old, frail, demented, incontinent etc, but to be complete in our future plans we have to account for that.
    So thank you for raising it again, and I hope more people add it into their considerations for the future!
    Cheers,
    The Shrink

    • {in·deed·a·bly} 6 March 2019

      Thanks TheFIREShrink.
      Fear of uncomfortable topics like budgeting, illness and mortality drives many of our behaviours.

      Our own long term care costs should definitely feature in our planning.

      However it is often the inadequate planning of our loved ones that may well trip up our financial plans, long before we get the chance to trip ourselves up!

      • TheFIREShrink 6 March 2019

        Definitely true, and something MrsShrink and I have often discussed. 100 years ago it would be the expected path that loved ones would move in with their children to be cared for in their twilight years, and it’s only a relatively recent move that we don’t. We actually expect older family members to move in and factor in that additional expense in our calculations. The numbers is the easy bit, actually being happy with the idea is harder!

        • {in·deed·a·bly} 6 March 2019

          That’s where the retirement home costs enter the equation, it is outsourcing the elder care in the same way nursery outsources the child care of infants and toddlers.

          Is a simple (though not easy) opportunity cost question: money versus happiness.

  2. SavingNinja 6 March 2019

    I finished reading ‘Being Mortal’ by Atul Gawande last week and he writes about a similar topic; how everyone believes that nothing will ever happen to them, how they don’t truly think about mortality and end of life care until they have to.

    The cost of quality assisted living is sky high and, being an only child, I don’t know how I’d feel if my parents had to go into a government-provided nursing home (basically prisons in every sense of the word from what I’ve read) because I decided to quit work at 35 and live off 15k per year.

    It’s an extremely difficult subject to think or talk about, much easier to defer! Although it has to be done if you want to be sensible in life, you don’t want these situations to catch you unawares.

    Thank you for linking this subject so artfully into our financial independence world, it’s strange how I’ve just finished reading about mortality in this book. Did you happen to pick it up when YFG mentioned it in his blog as well?

    • {in·deed·a·bly} 6 March 2019

      Thanks for your honesty SavingNinja.

      I don’t know how I’d feel if my parents had to go into a government-provided nursing home … because I decided to quit work at 35 and live off 15k per year.

      Almost certainly you’d simply accept it and move on. There would be no decision for you to make, because you would not be in a position to help them. In many ways that makes it easier, as the outcome is predetermined irrespective of what your preference may be.

      Where it gets complicated is if you do have the money to help. Then there is a decision to make. Do you help? How much do you help? For how long? And so on.

  3. Dr FIRE 8 March 2019

    This is a key reason why I think the NHS is so important, and why, if anything, it needs to be expanded. Admittedly, how one does that is another question… But the idea of some people having to pay £30,000 per year for a care home, or £6,500 every fortnight for chemotherapy drugs is outrageous. The vast majority of the population cannot, and will not, ever be able to afford that, and in my opinion, shouldn’t be punished for that reason. Alas, the way things are going in this country, I’m not optimistic.

    I actually do occasionally take a minute to think about how fortunate I am right now to be completely fit and healthy, and how quickly that can change. I could step outside tomorrow and get hit by a car. Or I could exercise every day, never smoke, but still develop cancer before I turn 40. It’s essentially completely random and out of your control, and I suspect that’s why most people don’t plan for it? It seems so abstract, unlikely, and far away. I’ve read before that this is why it’s easy for the media, or politicians, to, for example, paint all disabled people as work shy. If you’ve never had to experience that way of life before, why wouldn’t you assume that everyone could achieve what you have?

    Thanks for a thought provoking post Indeedably. Bit of a rambling reply, but I hope it made sense!

    • {in·deed·a·bly} 8 March 2019

      Thanks Dr FIRE, you raise some excellent points.

      The one certainty is the final outcome, the rest is a question of timing and style. Whether it is cancer, an errant cement truck, or just old age the result is the same.

      That is what makes financial planning so difficult to get right. Pessimism leads to a life of self denial and (potentially) a large inheritance for our kids. Optimism leads to enjoying life, but betting we run out time before we run out of money.

      The issue is that by the time we realise we got the balance wrong, it is often too late to do anything significant about it.

      One concern I have about the FIRE movement, particularly those at the shallow end of the net worth spectrum, is that the implications of their life choices are huge but seldom discussed.

      Not being able to help support ailing loved ones.

      Unable to help their children with tuition fees or house deposits.

      Running a lean financial setup with little padding, that is fragile and vulnerable to unexpected shocks.

      These are all real world consequences of those choices. By all means people should make the choice that works best for them, but do so consciously.

      It isn’t the sequence of returns risk or the market that will cause many plans to fail, it is the predictably unexpected life events like those discussed here.

  4. weenie 17 March 2019

    I have a draft post where I ponder what happens with people who FIRE in their 30s/40s and who have parents still grafting in their 60s, unable to retire because they cannot afford to. Do these young FIRE’d folk help their parents out, since their version of retirement doesn’t actually include not working so they will continue to earn income surplus to their requirements, which could be used to help their parents?

    Being brought up the way I have been, I do think there is a sense of duty for the child to support the parent in times of need, obviously subject to the conditions you mentioned, eg abuse, neglect etc. I am fortunate that my own retired folks are financially independent and need no support from us ‘kids’. But, personally, I would not question giving one of my kidneys to either parent and would ask for nothing in return.

    My own projections do not account for extra living and care costs – although they’re worked on the assumption I live to 100 but in my mind, 100 still with sound body and mind, which is not realistic at all! Perhaps I’m being the ostrich and burying my head in the sand but it is at the back of my mind so I need to plan for it in some way.

    • {in·deed·a·bly} 17 March 2019

      Thanks very much for sharing such self aware thoughts weenie.

      We must all make our own guesstimate of what the future may hold. Some folks will do so fully expecting a lottery win, while others may fear the sky will fall. The certainty is we’ll all be wrong, the important part is by how much. Providing we own that outcome, and hold ourselves accountable for the position we have placed ourselves in, I think that is fine.

      An interesting question is how many overly optimistic aspiring FIRE folk will themselves require bailing out by more responsible/grounded loved ones after a market correction, change in tax rules, or unexpected health issue?

      I share your values about owing it to our nearest and dearest to lend a helping hand where necessary, whether that be a kidney or a cheque. Hopefully my kids do too, when they are choosing my nursing home!

What say you?

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