SneezyParticipantStatus: PhysicianPosts: 91Joined: 01/11/2016
IF we assume that your parents have more than enough for retirement AND they are likely to leave a substantial sum to you, then we can view it as whether you’d rather have X dollars now or have them invest the money for you and get X plus growth when they pass.
Looking at it that way, if you had 100K extra today you’d probably put it toward your loans not invest it (as the expected return on the $$$ invested is likely lower than the rate on your loans even if you refinance). Therefore from a family wealth perspective (which may well be your parents perspective) it makes sense for them to help you now.
Of course things like siblings, longevity, etc. complicate this analysisAugust 9, 2019 at 3:10 pm MST #237724InfinityParticipantStatus: PhysicianPosts: 72Joined: 05/25/2019
My family is really close! They don’t even want me to pay them back but I know I will. They already paid for both my siblings, who have no loans anymore. I was just hard headed and refused to let them help me out before because I thought that was a tremendous amount of money. But now it is coming down to what is a better decision financially and what will save the most money for the family. My family will never ask me to pay them back but I will anyways. The main thing that worries me is since they get taxed on the money they take from retirement, I just can’t decide if getting hit with tax would be better than just riding out the interest. Is there a way to minimize the amount of tax? I see many are saying to do it in 15k increments annually, but my parents want to do 100k.Click to expand…
I would take the $100 gift.
As a parent, I would never let my kids graduate with $370K loan, 6.5% interests. This big burden will set you back several years. I have been saving in 529 funds since my kids were born.
I am quite confident that the money in their retirement accounts probably earns less than 6.5%. Plus, money in your accounts will compound much longer than if it would stay in their accounts.
So, I would not feel guilty, if I were you.August 9, 2019 at 4:34 pm MST #237739