The Endgame
Newsletter #78 - Follow the money
Port Medway, Nova Scotia, August 25, 2024
Follow the money
The other day I was driving behind a car with a bumper sticker that said, “We’re spending our kids’ inheritance one cruise at a time.” Another bumper sticker I’ve seen recently warned, “If you don’t fly business class, your kids will.”
Transferring assets from one generation to another is a tricky business. It’s not just about the destiny and well-being of families. Asset transfer shapes society. Intergenerational giving can perpetuate the existing class structure and freeze unfairness and inequality in place. What is justice between generations, and who gets to decide?
There is a lot of wealth to be transferred. A headline in The New York Times proclaimed that “The Greatest Wealth Transfer in History Is Here, With Familiar (Rich) Winners.” Says the newspaper: “In an era of surging home and stock values, U.S. family wealth has soared. The trillions of dollars going to heirs will largely reinforce inequality…” The article added: “Heirs increasingly don’t need to wait for the passing of elders to directly benefit from family money, a result of the bursting popularity of ‘giving while living’…”
Social policy is one thing: Family loyalty and dynamics, quite another. What is best for society is often of no interest to people pursuing their own particular ambitions. (This is sometimes referred to as “the tragedy of the commons,” selfish behaviour by individuals contrary to the common good.) It’s an unusual person who will first consider what is best for the community before drafting their will, or helping a child buy a starter home, or paying the absurd tuition fees of an elite university on behalf of a grandchild. “Unusual” may not be the adjective tossed around at a family meeting if the patriarch announces he’s giving everything to a home for stray cats and devil take the hindmost. (Fights among children over the disposition by parents of family assets can be especially bitter because the assets may be seen as a proxy for parental love and respect.)
“Giving while living” is different from giving by will. There is something otherworldly—literally—about disposing of assets after you’re dead. For obvious reasons, the person giving by will doesn’t have to worry about his own well-being. But giving while living means giving away assets that you can use for yourself right now. (Not spending while you are alive in order to increase the size of your estate when you are dead has the same effect.)
In a country like Canada there are many older members of the middle class living comfortably on pensions and savings and with significant equity in a valuable family home they bought 40 or 50 years ago for next-to-nothing. They are not rich, but they are not poor either. Along comes a child who’s short on a down payment for a condo, or can’t afford the tuition fees at Harvard, or is unemployed. What to do? Providing for that child by will won’t help. He needs money now. So, time to sell the family home? Forego that planned vacation? Not buy that new car that you need? Not make your annual charitable contributions? How do you adjudicate between your own needs and desires, those of your family, and your responsibility to the community?
Sometimes when I talk to members of my cohort about this problem, I urge them, depending on their financial circumstances, to look after themselves first. I tell them, don’t live precariously in your old age just to help your kids out. Let them fend for themselves. It’s time they did. But is this right?
What are the imperatives of love? Your responsibilities to the community which helped you thrive? And what do you owe yourself?
*****
Some reader comments on Newsletter #77 (Just things)
An important clarification from my daughter: “I don't think I said that about that bowl and jug! I remember them well, and would have felt the same way you feel about them. I definitely said that about some other stuff, though.”
A reader commented: “My memory is triggered by the sight of things... and thus I really have trouble for example putting certain clothes from earlier times now long unworn into the Salvation army bin. Once that particular shirt or scarf or whatever is gone, I won't have the reminder of a person or event that it gives me. I love time travel, and things as well as smells and tastes, can be such powerful transporters across time and space.”
A close friend wrote: “R. H. Blyth’s definition of sentimentality: that we are being sentimental when we give to a thing more tenderness than God gives to it. I read this in Salinger in my twenties, studying photography and it became an informal editorial assistant of my work. One's twenties can be an emotional time!”
This comment: “Your story about your mother’s jug reminded me of a conversation I had with my brother when we were trying to clean out my mom’s apartment after she died. My brother said that her clothes and jewellery were imbued with her personality and he had a lot of trouble putting them in boxes to give to the Sally Ann. I had the opposite reaction—if my mom wasn’t wearing them, there was nothing special about her things. They had lost her flair and style and were just old things.”
And: “Every birthday and Christmas I would give my little son an excellent, scaled model car, which he loved. One day when we were preparing to move, we had a yard sale. The enterprising little bugger decided to make some money by having his own table. I was too busy setting things up, getting signs posted around the neighbourhood, to notice he (now a young teenager) had set out the entire collection, 5 bucks apiece. I was horrified; they were worth more than 10 times that amount. When one gentleman was about to score the entire lot, I swept in and bought them under the most unhappy fella’s nose. I still have them. Oh, and the two train sets (now antiques) Dad bought for us when he put together a train board for my oldest sisters… Though word was that he really had bought them for himself, to play with when everyone had gone to bed.”
A Vancouver reader commented: “I have china that has travelled, some of it over a century-stretch, from northern Michigan to northern Ontario to North Carolina to Vancouver, Ottawa, Toronto, and back to Vancouver; also a small Tiffany-style lamp and a few pieces of furniture, including a small table made by my paternal grandfather. And American sterling silver flatware that was a wedding present in 1909. I am the last person for whom memories of people and places are attached to these things. Then they will be just things. Someone will want the lamp, I think.”
Another reader wrote: “A beautiful piece on the things that hold our memories, tho I prefer to use the term “personal artifacts,” it grants them the gravitas they deserve and makes me less like a hoarder.”
From a regular reader: “My moves over the last 16 years have enabled me to purge generously. Although I sold a few things, my greatest pleasure in the process was giving things away to friends that found new joy in these items and donating to organizations. I had many of my parent’s possessions… lots of furniture, china… even my grandmothers china… collectables of all sorts. None of these items owed me anything. I downsized significantly in my last move and kept just a few meaningful items…things that I loved. They not only remind me of my parents and my childhood but I love the design and historical significance of the objects…a panther lamp that I coveted for years, a couple of fine china tea cups of my mom’s that I occasionally drink a margarita from, a stack of small very old poetry books of my fathers, a well-worn ball pein hammer of my grandfathers and a beautiful glass paperweight of my Dad’s. My favourite keep is a Black Magic chocolate box full of love letters and telegrams that my Dad wrote my Mom when they courted and during the war…and letters from his mother. Letters that were beautifully written, chocked full of so much information about our family and her very astute observations of life in that era. So I kept a few things that can fit into a small box. They bring me more pleasure than all the rest of the “stuff” that I divested myself of. They have a place of prominence in my home. All that to say… purging creates space to hold the memories that are important… keep a few items that bring joy and give away the rest. (My advice… keep the pitcher and give away the bowl).”
A poignant observation: “I love these posts. Even though I'm just a wee bit younger than you, they mean the world to me. I am quite attached to certain things such as the canvas paintings that my older daughter created when she was age 11. They're beautiful, and I display them openly on one wall of my tiny living room. They were gifts from her to me, full of striking reds and purples in the shapes of women and flowers. Long before I had children, I determined that my home would be filled with items that I made myself; thereby, reflecting me mainly through textiles—a deep love of mine. That intention has continued with the art my children have made. Both girls are musical and visual artists, their days occupied by the care of children or tending to the needs of others through their jobs. I have recently felt the pain of having not pursued a life of music, always postponing, not believing that, one day, I won't be here. I recently attended a performance by the Montreal Symphony Orchestra, and I wept (quietly) from the moment I entered the venue… The beauty of the surroundings and the music put me straight against a life I have not lived to the full.”
The last word goes to David Wolinsky: “My storage locker is filled top to bottom with crap which for whatever reason I was constrained from throwing in the garbage when I cleaned out my folks’ condo 35 years ago. And to this day, it just sits there because it’s how I hang on to their memory. I only hope when it’s my kids turn, they have sufficient common sense to say ‘The old man must have been further round the bend than we even suspected’ and call Got Junk and have it as well as all my other crap hauled away.”
*****
A note to readers. Lately some readers of The Endgame, apparently musing on what I’ve written and thinking perhaps it’s all about me, have asked, “Philip, are you depressed?” Others ring up Cynnie and say, “Is Philip all right?” Rest assured I am fine (most of the time). Sometimes I write about difficult, even unpleasant, aspects of aging. Better to face up to these things, discuss and try and understand them, don’t you think? Maybe that’s a way to dodge depression.
*****
An interesting quotation from a book I am reading (a new occasional bonus feature of The Endgame).
Anyone can be a missing person. In Andrew O’Hagan’s new novel, Caledonian Road, Elizabeth and Moira are discussing the novel’s protagonist, Campbell Flynn, an art critic best known for his biography of Vermeer. (Elizabeth is Campbell’s wife. Moira is his sister.)
"‘That Vermeer book, it was so full of emptiness,’ Elizabeth said…
‘What do you mean?’ Moira asked.
Elizabeth touched her forehead and seemed harassed by the mystery. ‘Nobody knows anything about Vermeer’s life. That’s the point. If you asked whether he’d had a mistress or how he grew up, nobody knew. I encouraged Campbell to write that book because I thought he would grasp the condition.’
‘Well, he did,’ Moira said. ‘It’s a wonderful book.’
‘Yes, but it’s a terribly sad book, in a way. All Campbell understood was the emptiness. Turns out anyone can be a missing person.’”
I’m a year younger than you so not a kid. My wife & I have no kids..Neither do either of my siblings although my wife has 3 siblings, each with 2 or 3 kids. By North American standards, we were middle class; like your Canadian example, house & car with Social Security & a small pension. We live in a poor country with terrible schools. Without a better education, those nieces & nephews will be as poor as their parents, renting a small house but without a car, not to mention the 6-day work week without paid vacations or health insurance, much less job security, unemployment insurance, etc. As I said, it’s a poor country, one where all wealth has been for generations has been held by ruling families. So we’re paying all the health & education expenses of those nieces & nephews through college. And because this is a poor country it is within our means as retirees to do that & take care of ourselves on the monthly checks. (Tuition for a year at a either of the private high schools they’re attending costs about US$400 while college is more but similarly modest.) Speaking for myself while looking back at my life, this is actually the most significant thing I’ve ever done & as such, my greatest achievement. True, it’s almost nothing from a global perspective. Nonetheless, it makes me both proud & happy to just try to make their futures a bit better.
When you say their houses cost them next to nothing, you have to realize the at the time they didn't cost next to nothing. Our first home cost $59,00.00 and it doesn't sound like a lot NOW. Between us we were making aprox. $35,000.00. Our mortgage was at 10 and 1/4 percent! And when our first child was born I stayed at home. Our vacations were at the family cottage otherwise we stayed home. Yes we paid for our daughters to go to university because we wanted them to excel and they have. And yes we helped them buy their first home because paying rent is like throwing money away. Yes my parents and my husbands parents left us some money and we invested it. But we've had a full life and are making sure we have enough if we need help in our later years. I don't see anything wrong with our wealth going to our children and not the community.