How Much Does Your Family Know About Your Money?

My mom is coming to visit me and Mr PoP for a week at the end of the month. This has never happened before. NEVER. In fact, she’s only ever been to our house once for a few hours, at a small party we hosted after we eloped.  So yeah – a whole week in our house is going to be… interesting.

Incoming!!!

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Because this post is about family, here is part of Kitty PoP’s family – Z, who belongs to Mr. PoP’s parents. Yes, he eats his security blanket and is weird. But look at those whiskers!

She’ll be flying over 2,000 miles across the country and spending eight days in our house. Eight days! In our house! Can you tell I’m a little stressed out about this? Anyhow… stress aside, my mother’s arrival brings up an interesting question.  How much does your family know about your financial situation?

You, dear reader, have great insight into the current PoP financial situation. You can check our current net worth, and know about some of the big purchases that we have made lately like getting the Tree pruned and buying a new computer. It’s a unique position you are in, because you don’t know us in real life. So we feel like we can share more with you in the hopes that we’ll all learn from it.

Family, on the other hand, is an entirely different situation.

It can often seem that they know too much about us and there’s far too much history there for us to be eager to give family that kind of detailed insight into our finances. But, all families are different – and Mr. PoP’s family is about as different from mine as they come. So how does that affect what each side of the family knows about our finances?

Mr. PoP’s Parents – They Were Our Bankers, They Know Almost Everything!

When we wanted to buy a rental duplex in the middle of a recession (while Mr. PoP was earning minimum wage!), there was no way we would qualify for a cash advance the size we would need to be competitive cash buyers in the foreclosure real estate market. So Mr. PoP negotiated a loan of $50K from his parents to buy our duplex. Even though they didn’t pull our credit histories or anything like that, we were totally up front with them about the state of our finances. They knew how much we had in liquid savings, ball park figures on IRAs and 401Ks, and knew about how much we were bringing home from our jobs each month.

Since then, they haven’t been kept 100% up to date with our finances, but they have been made aware of some of the major milestones. So lately it’s more of a question of what they don’t know.

  • Mr. PoP’s parents don’t know that we’ve been paying our HELOC down at a crazy fast rate – check out the progress in July! – and have prioritized our debts so that we expect to pay them back the $50K loan a year ahead of schedule, and hopefully to avoid having to extend the HELOC or any other credit line to do so.
  • The last update on the PoP net worth that Mr. PoP shared with them was when we were sitting at around $300K. August net worth was over $344K, so they’re a little out of date there.
  • But that’s about it – Mr. PoP’s parents have a really complete financial picture of the PoPs even if they don’t know all the nitty gritty details like you!

My Parents – Why Is It Any of Their Business?

We’re grown-ups. At least that’s what we’ve been pretending to be for several years now. We go to work, come home, hang out with the cat, pay taxes, and are generally pretty responsible citizens. Part of being a grown-up means we can eat ice cream for dinner if we really want to, and I no longer have to return clothes that my parents think are “too form fitting”.

My paretns live on the complete other side of the country, and in case it wasn’t clear from the level of stress the impending arrival of just one half of the parental unit causes, ours is not the healthiest of relationships. So how much do my parents know about the PoP’s financial situation? Almost nothing.

  • They know that we bought our house about three years ago when we got married and did some work ourselves to fix it up. They have no idea how we financed it at the time of purchase, and also no idea that we refinanced with Wells Fargo last year to drop our rate to 3.25%. (I still get joy every time I say that rate…)
  • They know we bought a duplex at the end of 2010, but again have no idea what it cost or that Mr. PoP’s parents loaned us the $50K to make it happen.
  • I’m sure we’ve never mentioned the undeveloped lot that we own that makes up the rest of our real estate portfolio.
  • They don’t know that Mr. PoP ever voluntarily took a pay cut to minimum wage, nor do they know that our salaries are now.

Health of relationships and fiduciary obligations (from the $50K loan) aside…

Why Are There Such Big Differences in What We Share?

The best answer I can think of is that Mr. PoP and I share many of the same financial values that his parents do – and these are very contradictory with the ways that my parents have always treated money.

I think because we value saving, investing, and preparing for our futures the same way that Mr. PoP’s folks do, we feel comfortable talking about our progress along those goals. But my parents have never really been savers or investors, so we don’t really have a whole lot there to connect about.

I also worry about resentment on the part of my parents – for Mr. PoP’s parents and their generosity towards us with the loan, and for us for our success.

So how much does your family know about your finances? Do they know all the dirty little secret debts? Do they know about every little stock market win? And if you’ve got a spouse or partner, do their families know as much as yours?

(Bonus points for Asking Mrs. Pop about what form-fitting clothing she had to return in her teen years!-Mr Pop)

 

This article was included in the Carnival of Personal Finance #382.

49 comments to How Much Does Your Family Know About Your Money?

  • My mom reads my blog every day so she knows it all. My husband’s parents probably don’t know much. It isn’t a topic of discussion. My siblings all make a lot more money than us but are very confused as to why we seem to be better off than them. Hint: They spent it all.

  • My father in law is an income tax accountant, who does all of our taxes; it’s very handy. We also, like you, have some personal loans with them. My parents don’t know exact details, but they know about what we make, what our major purchases cost, how we chose to pay for them (ie car loan details and reasons), and roughly when we’ll be done paying off the mortgage. They also know about the loans from my in laws. So, everyone’s pretty much on the up and up.
    My lil bro is still in school and knows a fair bit as well… we tend to talk about approaches to money and strategies.

  • My family (and Mrs Scot’s family) know very little about our finances. We like to keep it private as they always think that they know best.

  • Our family knows very little about our financial situation. I’ve found it best to try and not mix money and family (as much as possible) as it can generally lead to disagreements. In the end, we’re adults and making wise decisions with our money. It’s not their place to try and correct us and vice versa.

    • I wonder how much Mr. PoP’s parents might know if we hadn’t borrowed $50K from them and it’s hard to say. They’ve asked us for financial advice, and we’ve talked about a lot of details with their finances that some of the other “kids” don’t know even. They respect us and don’t try and correct or change our decisions.

      My parents on the other hand… let’s just say I hope I survive next week =)

  • Very interesting! But I could imagine the same happening with my grandparents. When I was big into paying off my debt, I talked to my grandmother about it because she’s also deep in debt, and it was fun to commiserate about debt, collection agencies, etc. Now that I’m debt free and more concerned with growing my emergency fund, I don’t talk to that grandmother about money. I have much more in common with my dad’s mother, who has always been a very frugal person and saves as much as she can.

    As far as our parents go, neither side knows much. It’s just not something that ever came up with David’s family, and though my parents know I paid off my debt in February, they don’t know much else.

    • That’s pretty cool that you skipped a generation and are close enough to talk money with your grandparents. Ours are either dead or senile, sadly, so there’s not a whole lot of insight left to be garnered from sharing with them. =( But I bet grandparents have a lot of experiences from living through the depression that could be really valuable today.

  • My parents know a bit and that we have purchased our rental property. They have been smart with their money and, like your inlaws, we share similar money values. My inlaws have been big spenders and lost everything, including their home, during the recession. It’s very hard to talk money with them. We are on different planets. We also feel guilty for having things when they don’t, even though we had no control over their mismanagement of money. We’ve considered giving them money, but another relative did this and they blew through it also, so we haven’t. Actually, hitting rock bottom has forced them to live within their means for the first time, and as long as they have a roof over their heads and food, we stay out of it. Good luck with your family visit, and I would love to know about those form fitting clothes.

    • ha – Mr. PoP asked me about the form fitting clothes, too! The one time that really sticks out in my head was when I was 14 and several of us went to the mall and bought matching curious george baby t-shirts – I had babysitting money that I used to buy it. (Remember baby t’s? Now they’re just called T-shirts!) My mom flipped out, said it was too tight (not that I had anything to show off!) and made me return it. So I couldn’t match my friends when they wore theirs. =(

  • Everything! Both Jefferson’s and my parents know every single thing about our finances. They know Jeff’s salary, how much debt we have, how much we owe on our house,what we paid for our children’s activities….everything. We are very open with them. Now, my sister doesn’t know quite as much, but it’s only because we’re the only kids in the family and very close in age. Because of that, we’ve always been weirdly competitive with each other. I just think it would be weird to talk about everything in detail with my sister, even though she knows WAY more than either parent about other aspects of my life. I just don’t want to have hard feelings either way with her. She’s not open with me about their earnings/spending habits either, so I feel we have an unspoken mutual agreement to only gossip and talk about our husbands. ;)

  • I’m pretty open with my Dad about our finances. He knows our whole financial situation. The mom on the other hand has no idea but we don’t talk very often and I don’t want her to know. I’d probably get hit up for money if she did. My in-laws know we are responsible with our money but they don’t know specifics but they are awesome and I wouldn’t care if they knew.

  • My parents know everything about my finances. My boyfriends mom doesn’t, but I’m sure once we are married she’ll be let in the know but she’s not judgmental. My parents read my blog daily and are extremely proud of me, and even comment on it from time to time (cute, but a bit embarassing :P). The only thing I HATE about my parents knowing is when I spend a bit more than planned (still not much and ALWAYS able to pay what I plan to on my loan) my mom can be annoying about it, “Well are you sure you can afford that” etc. YES I can afford it and as long as we aren’t making dumb decisions, we deserve to treat ourselves ! Otherwise the 4-5 years it will take me to pay off my debt will be pretty miserable years!

    • That’s adorable that your parents comment – I’ll have to keep my eyes peeled for it and see if I can tell who is your mom!
      I’m glad my parents aren’t the only ones who still think its appropriate to tell their grown kids what to do with their money. Frustrating, huh?

  • Jessica @ budget for health

    Both sets of parents don’t know every detail of our finances, but they know our salaries, financial goals, and how we’re investing. My father-in-law follows my blog so he gets a pretty good idea from seeing our quarterly budget review any any other article I write about our finances.

  • CF

    My parents know most of my financial situation, like my salary and student loan debts and our mortgage, but they don’t really know the details about our other investments. They have always struggled with money, so when we do talk about money, it’s usually them asking me for a loan… :S

    • Have you ever loaned them money? Did they pay it back? I know we have a very formal agreement with Mr. PoP’s parents about the loan, with a written contract and everything, which makes it feel more like a business thing than a family thing…

  • Ivy

    My mom is very inquisitive, any time I happen to mention something financial she will be asking straight how much did it cost, how much was the salary increase, how much do you still have left on that mortgage, etc, etc. I actually hate this, but she gets very offended if I refuse to answer, so she usually gets it. Why I hate this? There is no good outcome here. When we were deep in student and all kind of debt she worried all the time, now that we are doing well, she brags. Neither of these is healthy.
    My husband’s parents rarely ask and only in broad terms, but then they probably feel awkward to ask because I am the breadwinner and he is a stay at home dad.

    Funny how a visit from your mom can get you so rattled. Different culture again – our parents were visiting for 3 months every year until dad got too sick to travel, and we’ve always had long-term guests, friends crashing with us when on hard times, visitors all the time. You are pretty much expected to have open doors for family and friends any time. “my home is your home” is how it goes:-)

    • Yeah, one of my co-workers asked me why I was so stressed and I unloaded on him a little this morning. His words, “On the bright side – there’s a departure date!”

      We have open doors for a lot of people, the relationship with my parents is just really strained and the only person who really seems to get it completely is my sister because we both ended up at the same point with our parents, but traveled there independently. =/

      Since you’re a mom, do you think that you’ll be different toward your kid(s) when they’re grown up? (I don’t know how old they are, so maybe this question is moot!) I worry about having kids since I don’t want to end up with kids who are stressed about me the way I am about my own parents.

  • My mom doesn’t know the exact specifics of my financial situation, but she knows I like to save. So I don’t think she’s too worried about me. My brother though, is a spender, haha. My mom does all his investing for him so it depends on the person I guess.

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  • When we buy or sell a house or a car we tell our parents because if they come out to visit they will see it anyways. But we never talk specific dollar values. We might say we made a ton of money selling our house but we don’t talk about how much we sold it for. Both our parents are quite financially stable and the only thing my father gets concerned about is if we are okay. Other than that he does not share specifics about his finances and does not ask for details about ours. He respects people’s privacy.

    • That’s interesting that house prices are things that you guys think of as private. We never think of what we paid for any property as private since it’s a matter of public record and just a matter of going to the county property appraiser’s website and searching for our names. I guess not everyone geeks out on the property appraiser’s website the way we do, though.

  • Hmmmm…. I’m a little unclear about why you care whether your parents know anything, nothing, or everything about your finances.

    Unless they’ve lent you money or in some way are supporting you financially, it’s none of their business. And possibly they themselves think of it as none of their business, it being a great delight to have adult children over whom you no longer have to fuss. After all, for every emancipated son or daughter, there’s an emancipated parent. ;-)

    Try thinking of her as just another adult friend, with whom, as with your other adult friends, you don’t discuss the intimate details of your finances. If she pries, try changing the subject, saying “we’re doing fine and expect to keep on doing fine,” or — only if pressed to it — say openly that you don’t want to discuss the subject because you consider that a private matter between you and your husband.

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  • My side knows nothing other than I have a load of school debt and a mortgage. My mom has no idea I paid for over 10k in tuition with credit cards or any inkling as to what we owe (she would die). We’re not that close to my side of the family though, mom included. Hubby’s side is different. His parents and sister have a pretty good idea but no details. They know we’ve had some financial problems and his parents know we’re now in a DMP. I don’t care to get into details with family, ours at least, we view and prioritize money in very different ways.

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  • Interesting!

    I like to play our cards close to our chest. On his side, because his family are broke. We aren’t making tons by any means, but in comparison, we’re raking it in. And of course I don’t want to encourage any requests for loans etc.

    I’m not super close to my parents, and we’re pretty private. I would happily talk to them about our finances, but don’t have any reason to.

    • I didn’t go into that aspect of it much, but there’s definitely a disconnect with where my parents are financially and where we are/aim to be, which probably plays a role in why we share less with them.

      As for loans, do you think his family would really ask for one? I’m pretty sure pride would get in the way of my parents asking outright for money…

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  • Jill

    Very interesting post! I just found your blog and reading through some of your posts. Similar to you, one set of parents knows a lot about our finances and the other very little in the way of any specifics. My father does our taxes every year and knows quite a lot. My husband and I share many money values with my parents, and I ask sometimes for their advice. My husband’s family, on the other hand, struggles financially for a variety of reasons, including money mismanagement. While they do not know specifics, they know we have good jobs and a nice home at a young age. And they have borrowed money from us more than once, when in rather dire straights. Honestly, that is a very difficult situation to be in.

    • Sounds like your situation is definitely very similar to ours – except that my family has never asked us for money. Hopefully that never happens since I have a pretty good idea how awfully that would turn out. How did that work out for you guys?

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