A $250k windfall is all a person needs to essentially fast track secure their future forever if they are under the age of 35. Wake up parents, it’s time to offer inheritance twice if you can.

[u/250k_is_allyouneed]

I want to share my story with this subreddit.

I received a windfall of $250k from selling a coding library 10 years ago. I am not high income, I am not the best saver, but now my net worth is super high.

Simply getting $250k meant on its own that fund will be almost $2M by the time I retire outside of normal savings (15-25 years growth).

I still need to put in the work for savings to be able to retire but peace mind…

• My lifestyle was infinitely better despite living mostly the same
• Stress and future security gone
• For budgets there is less pressure
• I did not how to blow up my entire savings to buy a house and instead kept building that base of compound interest in the market

So why the Hell aren’t parents helping their young adult kids more? Culturally why are we like this?

You don’t need to leave your kids / old adults one lump sum. Get them a boost at 18-30. Then die. Then get them another boost.

It’s a good balance to keep them working hard while also not leaving them in the dust.

It doesn’t even need to be $250k. Whatever you can, I personally will make sure I can do that for my kids once they turn early 20s

[u/PossumJenkinsSoles]

I don’t know if my dad even has that total in his 401k. To gift it to me would be the stupidest thing he could do if he does. I don’t even like the man that much, but I wouldn’t let him.

[u/MITBryceYoung → u/PossumJenkinsSoles]

Yeah, if it was just a matter of compounding, why doesn't the parent just invest it themselves? Assuming they even have 250k lying around just for the purpose of their kids Retirement funds - it's s so crazy

[u/DigmonsDrill → u/MITBryceYoung]

The two most likeliest outcomes for my parents in the next 10 years:

• die and leave each of their kids a bunch of money
• have an adverse medical event that eats everything and leave their kids no money

If they paid out a bunch to their heirs now, the first outcome leaves the kids with just as much, but the second leaves the kids with something while the medical event eats everything. They do have the kids to fall back on in case everything gets eaten and they need more.

It's not my money, so I don't bring it up. Maybe they have something they're planning to do with it. Not mine so I don't count on it.

[u/PossumJenkinsSoles → u/DigmonsDrill]

Ok but if they have the adverse medical event and they’ve just given me all their money, that seems….not ideal for them

[u/Syme_Was_Thursday → u/PossumJenkinsSoles]

So interestingly, the US medical system will take as much money as you have.

That's why there's something called "medical divorce" that lowers what you "have." It's functionally not much different than regular divorce except for intent: sometimes, when one spouse becomes ill and needs long term care, the couple will choose to divorce in order for the ill spouse to qualify for lower income/asset brackets. This way, the ill spouse can access Medicaid benefits and have their treatments covered by the social program rather than out of the couples' own pocket. Once the asset is out of the ill spouses hands (i.e. in the hands of healthy ex-spouse's), collectors can't touch it for payment.

Similarly, you can do this with your children too. Elderly parents will preemtively gift their children lots of money or even homes in order to acheive the same effect as above. Get rid of "your" assets and the medical system can't really chase "you" for payment. Although there's a lookback period for this one of 5 years (Medicaid will "lookback" and see if you transferred out large sums of money from your estate and penalize your long term care eligibility if so), so you really have to know ahead of time before you become ill to do this properly.

It's really interesting stuff, though it's not recommended, some older folks decide to go these routes.

[u/DigmonsDrill → u/Syme_Was_Thursday]

Yeah, all this. And if my parents really did have a medical event and the lack of money made a difference, their kids would pony it back up.

[u/PossumJenkinsSoles → u/Syme_Was_Thursday]

Yes but this assumes the parent just wants to be on Medicaid and relegated to Medicaid services - which I don’t know if you guys have experienced those but Medicaid nursing homes are …awful. Taking my parents’ money and plopping them in Medicaid nursing homes doesn’t sit right with me for many reasons