Hot answers tagged

158

What's Wrong With Being a Turkey? One of our dear friends comes to us to seek advice, since we seem to know a thing or two about money. Our friend just so happens to be a turkey - a particularly great turkey, thank you very much, so don't judge. Our dear turkey friend is being told by all their friends that there is this incredibly friendly butcher they ...


139

Your father was giving your mother money intended to be spent on your food, clothing, textbooks, and so forth. Your mother no longer has these expenses. The only expense that remains for her is rent (or property tax), considering there is probably now an empty, redundant bedroom in her home. The extent to which your mother was also expected to contribute to ...


75

Loaning money to close relations tends to end poorly. You are better off not loaning your older child money. This solves all your issues except for one. You mention that your cash savings are earning "almost nothing". Is this an emergency fund, or money that can be invested? If it is an emergency fund, you have yet another argument against paying off ...


74

I have no problem with you helping your mother but only under the following circumstances: You have enough room in your budget to help out. You should not go into debt or sacrifice your necessities to support your mother. Your dad is not legally obligated to help. If he is, she should pursue that first. She needs the help. Is this money from your dad that ...


59

I think it's less about proving that it's a Ponzi scheme and more about thinking which argument will resonate best with her. Everyone responds to different types of arguments. For someone who is a logical thinker, you could break down the logic and explain how ridiculous the returns are. With such ridiculous returns, you would have to wonder why someone ...


57

"Mom, that sort of thing is court-ordered." Tell her that she will need to go back to court to have the divorce settlement modified. You will be happy to comply with any court order, of course. The money in question is child support. It reflects that the cost of living with a child is higher than living alone. Obviously, if you move out, that has a big ...


44

TL;DR Knowledge is the only way to dissuade a person. If they don't accept knowledge then there is unfortunately very little you can do besides beg them not to do it. Unless this is money laundering then there is really no reason that such an establishment would need your money just to give you back 150% at the end of the month. I'm sorry to hear that her ...


27

A sign that it is a Ponzi scheme is that the returns are so good that the victim lets it ride. They are encouraged to not pull money from the program. Showing them the cash makes it seem real, but they never need to have as much cash as you would think as long as the number of participants is growing. To convince somebody you need to be able to explain why ...


27

I tend to follow the Keep It Simple, Stupid principle. Next year at the same time when I give my college student daughter some money for a car, I'm going to give her brother an equal amount of money. (I'll suggest that he add it to his own Car Down Payment Fund -- or if he buys a car by then -- apply it to the loan principal, but it'll be a gift and he can ...


20

First and foremost: this might be a legal issue, not a financial one. In most locales, support payments like this are part of the formal divorce settlement. Someone needs to locate a copy of that settlement document and read over what the specific terms are for these payments. Those terms will play a big part in what happens next. If your father's ...


19

Have her invest exactly 1 dollar and allow her to only re-invest any money deriven from that very first dollar. Within 3 years (which equal 36 months), she will either be a millionaire or she will have lost only that one dollar and learned a valuable lesson. 1 * 1.5 ^ 36 = 2,184,164


15

If you want to be fair then be fair. It sounds like you wish to gift this money so offer it as a gift. Hi kids, I have an extra £xyz lying around so I would like to give each of you half. If this is truly a "no strings attached" gesture then I would like to add that you are a very generous parent. If this is a dirt-cheap write-off loan you wish to offer ...


14

They give the casino the cash, and one month later get 150% back. That's 13000% interest per year (before you ask: I refuse to use thousands separators for interest rates, to preserve my sanity). Some of them have been doing this for years. That seems unlikely. If they started with $10,000 and did it for 2 years they'd have $169,000,000 by now and ...


12

can promise the same cash amount later, but how do I financially value the benefit my son gets now? I suppose your question is outlined above. You want to give money X Amount to your son now and same amount X to your daughter, but later, and wondering if that is fair. In a positive interest rate environment "dollar today is worth more than a dollar ...


9

How to convince her it's a scam? Easy, ask the following questions: Is it the casino, or someone AT the casino? Do they have any paperwork showing they loaned the money to the casino? Why would the casino pay 50% monthly interest rate when even credit cards top off at 25% annually? Surely the casino can go to a bank and get a much better loan, why does it ...


9

You edited out the part of you assisting your sister in hiding money from the court. Read your original post out loud to yourself three times. Now what do you think? Of course it is a bad idea, and you should say "sorry sis, I am not going to help you break the law". This would hold true even if you are beyond the jurisdiction of the EU. Edit: So lets ...


8

The reason this is so confusing is that 3 different forces are acting on this mess at once. Giving a gift to one child (and not the other) Lending money to one child (and not the other) Investing your own money for a viable return I get where you are trying to create synergy here, but this is creating an overload. In our culture, dealings with money ...


6

Although other people here already shown 150% compound return is impossible, I doubt you can convince your girlfriend and the family easily. As mentioned by Daniel Kahneman in his book Thinking, fast and slow, human being love to convince themselves to unrealistic stuff with stories(thinking fast). To make one think rationally (thinking slow) is not easy ...


6

Don't try some complex system of double entry-accounting. Just open bank accounts in their name. The money that they get from relatives can start earning interest. Yes I know that interest rates are low in the United States, but if my kids were young I would do the same thing. The interest they earn will be credited to their account. Having the separate ...


5

There are several risks to you. Depending on the details of the arrangement, you might be liable for income tax on the money apparently "given" to you, and your sibling might be liable for income tax on the money you apparently "give" to them. If the bank find out that you have given her "your" debit card to use, that is against the Ts and Cs of the ...


5

Why would the operating company's other non-familial shareholders be concerned with your internal family arrangements? When forming a partnership, with other persons, it is recommended that a legal document be drawn up that covers adverse conditions often referred to as "the 5 D's". That is divorce, disinterest, drugs (illegal activity), death, or default (...


4

Assuming you don't actually need the account to be anonymous, this is fairly easy to do. It's just a joint account. You need to pick a few people, maybe around three or four, who will manage the fund. You open a joint account in their names. They identify themselves to the bank and are responsible for the account. You tell the bank in advance what the ...


4

Either your father paid Child support with a certain amount per every child. And final amount have changed since you moved out. You need to be aware that in such case such money were designed to cover all YOUR needs. So by moving out you also removed your mother need to pay for you. Those money were yours money only to be managed by your mother according to ...


4

The OP has made it clear that she is interested in exactly how the two gifts can be made equal, considering that the gift to the daughter will come years (in a comment she says perhaps ten years) after the gift to the son. Other answers have talked about present value, and writing a provision in the mother's will to insure that the daughter does actually ...


3

You will run into multiple issues when trying to use a bank account: the bank will require a social security number when setting up the account, or the equivalent for a corporation. Any interest earned will be assigned to that number some banks will allow a small community organization, think scout troops, that don't have those numbers to set up accounts, ...


3

Assuming you aren't offering a better interest rate than the current mortgage then on day 1 you won't be giving your son any gift. The gift will be given at the point in time you decide to write off the loan. So to keep it simple, you could gift your daughter the same amount that you write off and at the same time as the write off. Or alternatively, gift ...


3

You should just need two entries in each scenario: Grandparents send birthday money to the checking account: Debit Assets:Checking Account Credit Liability:Birthday Money (it's not "income" to you, so it goes straight to a liability) Kids spend their money from the checking account to buy a book: Credit: Checking Account Debit Liability:Birthday Money ...


2

Assuming strong family ties, you could just talk to your kids. Both of them. At the same time. In my family, we have agreed that I give my mother money for home repairs and get a signed loan contract with 0% interest, which will increase my share when inheriting the home in what I hope will be quite some decades in the future. For my location (Germany) this ...


2

This may not be the kind of an answer you are looking for, but let me offer an alternative prospective. For one, the money is yours, but at the same time, its your families. Your eldest needs the money right now, its nothing to do with being fair. If and when your daughter is in need of any money, this also sets a precedence that you will be there to support ...


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