After Winning the Lottery, I Gave My Sister a Generous Gift. Now I Want It Back.
Our advice columnists have heard it all over the years -- so we're diving into the Pay Dirt archives to share classic letters with our readers. Submit your own questions about money here. (It's anonymous!)
Dear Pay Dirt,
Fifteen years ago, in my early 20s, I had a winning lottery ticket that paid just under $1 million after taxes. My older sister "Elena" made a case that she deserved a share because she stepped up and raised me after our single mom died when I was 7 and she was 20. But I knew giving Elena a pile of money outright would probably do her more harm than good because at the time she was an active drug addict. So, after paying off my college loans and credit card debts and buying myself a small house and a new, reliable car (which I'm actually still driving to this day), I saw an attorney who helped me put the rest of the money in a revocable trust with Elena as the beneficiary.
Elena has been clean for almost 10 years now. She's an amazing foster mom to several troubled teens and works part-time, in addition to receiving approximately $22,000 a year from the trust. Meanwhile, with my house paid off, I've been able to get by doing the creative work I love. Then I accidentally got pregnant. The father is a good guy and would want to be part of our child's life, but won't be able to pay much support. I can't raise a child on my current income, and if I got a regular job, most of my additional income would be eaten up by daycare, plus I'd be less present, less happy, more stressed, and not as good a mother. Until now I never realized how badly I want to be one. And I'm 38 so this could be my last chance.
Would it be selfish of me to dissolve Elena's trust so I can have and raise my child, even if it means Elena needs to work full-time and can't be as present for hers? Should I worry the resulting stress might cause her to backslide into addiction? My plan would be to use the interest income to make ends meet until my child goes to college, then pay for his/her education out of the principal, then possibly share what's left with Elena, if she's still alive by that point (she's 51 now, and has some health issues as a result of her past). If this is not an acceptable plan, what would you suggest I do?
This sounds like a hard scenario and I want to hold that space for you. Your worry is valid and with either choice you make, it's going to have an uncomfortable consequence for someone involved.With your generosity, your sister has been able to find a healing path while helping others. It sounds like she has become reliant on this income to help raise her children, so not having it will come as a blow. Taking a substantial part of her income away will add stress and with stress, some addicts relapse, but many don't. Part of the recovery process is finding coping mechanisms that work for you so that you can handle situations like this. So, while I don't think taking the trust away is going to cause her to relapse, I do imagine it will spur some hard feelings like resentment. She is, in a sense, trading places with you.
I do not think you're in the wrong if you revoke the trust so you can now raise your child while working part-time. When you originally set up your financial affairs, you did not imagine that you would have the opportunity to be a mother. Now that you do, it only makes sense for you to want to enjoy it. That includes rerouting resources to help you with your new circumstances. So yes, it's going to be hard on your sister but you have shown her nothing but support in her journey of being a mom. I'm almost positive she will be happy to do the same thing for you now.
It's going to be a difficult conversation but set a time aside to talk to your sister about the matter at hand in a neutral place such as a coffee shop or a park. If you feel uncomfortable doing it in person, make time for a phone call where you won't be interrupted. Explain that your new circumstances have led to a change in financial priorities, and while you have been supporting her and her children, you now need to support a child of your own. Ask her what she feels is fair in regards to ongoing support. Maybe you can deduct a certain percentage of money from her payments every year until you are no longer supporting her at all. Perhaps it's just helping her out with emergencies. You may be surprised by her answer. I'm definitely curious so keep us posted on what she thinks. I'm sending you the best of luck.
I am getting married in the fall and my best friend since middle school, Mary, is one of two bridesmaids. A bachelorette party is being planned with about seven guests a two-hour drive away. Mary is the only attendee who is married with young kids and she has a tighter budget than the others (I met the other women through work or grad school). In discussing accommodations she said she couldn't afford the proposed rental and offered to not attend. I asked if I could cover her share which she adamantly refused.
Then I told her that we should then pick another, less expensive rental (or destination). I said several times that her presence and spending time with loved ones was paramount, which is absolutely true, but she again refused, saying she would be causing me and others to "settle" for a lesser experience. Until now, she seemed excited about a weekend away.
I don't know where to go from here. I know what it's like to feel self-conscious about money and I don't want to put that on Mary. (I grew up without much money and found it terribly embarrassing.) I also recognize that American weddings and bachelorette parties are big asks of participants and in no way do I want to be a demanding bridezilla. I am fine with a less expensive rental or locale. At the same time, this could all be solved if Mary would just let me pitch in extra, but I am afraid I might have offended her by offering. What should I do?
I doubt you've offended her by offering, but she may genuinely not want to be the reason you have to change your plans. You also mention that she has two young children, which can make it difficult to spend time away from home. (If her spouse can't take care of the kids, that can also mean hiring child care and rearranging logistics to accommodate.)
I understand why you're disappointed, but you don't want a bachelorette party weekend where Mary feels like she's on the receiving end of charity. The weekend wouldn't be enjoyable for either of you -- even more so if she's not close to the other participants at your party, who you say you met through work and grad school. So I think you have to respect her decision to opt out.
It doesn't sound like she's opting out of the wedding itself, and if she's a bridesmaid, that's already a big commitment that she has to spend time and money on that she may not really have. Asking her to spend more time and funds for a weekend trip may just be hitting her limits in terms of both. You know personally what it's like to not have enough money for this sort of thing when others do. I know you're trying to help, but if you keep insisting, you may be creating more stress for your friend.
I'm really screwed up and think others might be in the same boat. I am a single professional who has worked hard all my life, having been employed from the age of 15. Recently, when I turned 63, I kind of retired. Over the course of this time, I've saved about $7 million but have no pension except for a couple of annuities amounting to about $1,200 per month. I have a financial planner who has me at about 60 percent equities, 20 percent bonds, and 10 percent cash. My problem is that I'm not dealing well with drawing on my funds and feel financially insecure. My friends, my family, and my adviser tell me I'm fine and have nothing to worry about, but I worry constantly. I shop at discount stores, buy low-end products, live in an apartment I'm not thrilled with, and avoid spending whenever possible. I cannot seem to break out of the "accumulation" phase and into a proper retirement. I turn 65 in several months but don't see anything changing. Is there a name or condition for what I have? What is the best way for me to deal with this?
There are many people, like you, who become accustomed to frugality and living in conditions they don't really like in order to become financially stable. When they finally are, they've conditioned themselves so heavily to worry about money that they have trouble breaking out of those habits. I'm not sure this is a specific condition, but it's not uncommon.
Part of why you're having trouble enjoying your money is that there's probably still some part of you that fears being financially insecure, even though you're not. This can make spending feel unpleasant. You may even feel irresponsible doing it.
You need to give yourself permission to do it, and plan for it so that it doesn't worry you. I would recommend that you meet with your financial planner and set some goals for what you'd like to do with your money, and then budget and schedule these expenses. For example, if you're not happy with your apartment, look into what it would cost to upgrade to a place you would enjoy living in, and give yourself a budget and deadline for finding something. I think being very intentional about your spending and planning it responsibly will help address some of the discomfort you feel, and once you begin to enjoy the fruits of your years of hard labor, it'll get easier to spend reasonably without anxiety. If you find that your discomfort with spending persists, even with those interventions, it may be worth seeing a professional therapist to help you get comfortable with your situation.
I am currently a stay-at-home "housewife/dog mom," with no kids (and never want them). I was making good money before, a $200,000 salary, but was always stressed out and worked 100 hours a week. My husband makes a lot more, so he encouraged me to quit and stay at home with our dog. We have always kept our finances separate but transparent, which works beautifully for us. He writes me $10,000 checks whenever I need more money, which is very generous. We have literally never fought about finances, and have an unusually healthy and happy marriage (I call him my unicorn). However, I have been advised to stash some money away "just in case." This seems like a terrible, deceitful act, in my opinion, but a tiny part of my brain is like, You never know ...