Layout:
Home > Extremely financially eventful day. MIL's gift.

Extremely financially eventful day. MIL's gift.

January 2nd, 2014 at 05:41 am

First, bad news. I dropped my 100 days old iphone 5s in the toilet. It is dead. Frown It sucks. I will have to pay $300 to get it replaced for a re-furbished one in the apple store.

Today we had lunch in Chinatown with mother-in-law. Dim sum and my favorite shrimp and walnut dish(deep fried and the sauce base is mayo and condensed milk mix. 50 minute workout I put in later will not fix that).


We picked up the tab ($42). That is very cheap for 3 people and a child.

Than we talked with my MIL. She wanted to buy a whole life policy on our son, as "protection" for his future family. So I made detailed spreadsheets to illustrate to her how this was not a good use of money. It worked! Just trying to talk her out of it never worked, but when she saw our projections, that helped.

She also told us that she had a policy on my DH, that she opened when he was 4, and that if we want to cash it in, we can do it and use the money for whatever we want. That is about 6K. That is pretty unexpected.

She also gave us a gift of 10K, to help us with our son's pre-school fees or whatever we feel would be of benefit to him or us. WOW. that is extremely generous and I am very grateful. She just gave it to us. We are not struggling or ever complained about finances, so this is absolutely amazing.

She did say though that we should have a second child, but I choose to attribute that to her being a grandmother, it was not a condition for her gift - she gave none. I think it was probably more of a gesture to let us know that she can help and so we should not be as scared to have another one.

So, overall we are 16K(-$300) richer today, as a family(we will probably put large chunk of that money away for our son's education). And it is all tax free - there is no tax consequence for gifts under 12K, and life insurance policy was held for over 15 years, so that is not a subject to tax either. That is amazing start of the year.

Would this qualify as a snowflake? (or an avalanche Smile )

14 Responses to “Extremely financially eventful day. MIL's gift. ”

  1. CB in the City Says:
    1388673423

    Wow, that's awesome! Were you the one who had to do an expensive bathroom remodel? If so, that should be a great help!

  2. buckybadger Says:
    1388674650

    And actually, there's no tax consequences for gifts under *$14k,* and the taxes aren't paid by the recipient of the money, rather they are paid by the one gifting the money.

    Nice windfall - good luck with it!

  3. creditcardfree Says:
    1388676489

    What a wonderful gift! So nice when they arrive unexpectedly without strings attached.

  4. ThriftoRama Says:
    1388679682

    Uh, Avalanche. That was really very generous of her. And yes, grandma's always want more babies. Although, when I became unexpectedly pregnant with my second, my mom said " I don't know if I can love another baby as much as I love (son 1)."
    Well, that isn't true!

  5. Nika Says:
    1388682148

    I'm not sure I can add it to my snowflake total, since I did not earn it, or did not come by it as a result of additional actions on my part. Would you count it in your snowflake total?

  6. TashaC. Says:
    1388705858

    Can you please explain further how a life insurance plan for a baby is a bad idea? i agree it is a huge money suck. But FIL bought one for both his kids and husband wants to get it on our new baby. I don't have a good argument against it.

  7. buckybadger Says:
    1388706194

    Insurance is not an investment vehicle - it's for replacement of income. Babies don't earn any income therefore they don't need insurance. You don't need insurance unless you have someone who depends on your income.

    That's a separate issue from that fact that whole life policies are terrible scams in general.

  8. TashaC. Says:
    1388707282

    thank you. FIL's argument is that it will be a gift to our daughter when she has a family. So she wont have to get her own policy- she will already have one. Kind of a good argument but I am more of a "lets worry about getting a policy when/if a policy is needed." Thanks for reminding me insurance are not for investing.

  9. PatientSaver Says:
    1388854766

    If you think about it, it's better to gift money to family while you are still living, so that you can enjoy the satisfaction of seeing your family benefit from the gift. What good does it do to wait til you're dead? As long as she won't be needing the money, I think it's a great thing to do, especially since it avoids possible Title 19 issues or estate taxes on the money, and 100% of it can go to the family. The fact that the amount was $10,000 tells me she knew she can gift up to that amount tax-free.

  10. Nika Says:
    1388872193

    Tasha, none of the arguments were convincing enough to her before (her "friend" is a whole life insurance agent and is really relentless). So this is what I did: I took the paperwork her agent gave her, and plugged in all the payments and guaranteed value projections in the table. Than I ran the calculations with those same numbers, assuming investing in a stock market, and calculated what the returns would be assuming 3%, 5%, 8%, 10%... At each age for which the policy had a stated guaranteed value. The difference was shocking.

  11. wowitsawonderfullife Says:
    1388895715

    re: iphone. Drop it into a zip lock bag with a bunch of rice. Let it sit there for several day. It worked for us. Make sure the rice covers the entire phone.

  12. TashaC. Says:
    1388958829

    thank you for sharing your formula.

  13. Snafu Says:
    1388963572

    Wow, an incredibly generous gift. Brilliant to confront MIL with hard figures. Most of jus try to sway opinion or viewpoint with words and fail miserably. If you have not yet funded ROTH 2014, I wonder if that would generate sufficient income to fund Ds's tuition year to year for the most part.

  14. CharlesPeake88 Says:
    1389344201

    So you became richer finally, if we count just a day. Forget about the iPhone's incident. To keep balance in financial situation is very necessory.

Leave a Reply

(Note: If you were logged in, we could automatically fill in these fields for you.)
*
Will not be published.
   

* Please spell out the number 4.  [ Why? ]

vB Code: You can use these tags: [b] [i] [u] [url] [email]