A guy named Bob asked me a doozy of an money/ethics question this past weekend. I’m fascinated by this question, mainly because I’m torn as to what the answer is.

Here are the basics

Bob’s grandma died. When she died, she left Bob, his cousin, and his younger brother her house. The three sold the house and got to keep about $50,000 each. A few months later, Bob and his cousin were found to be beneficiaries of a life insurance policy on his grandma that was purchased well before Bob’s brother was born. The life insurance policy was for $47,000. This means that Bob and his cousin each received $23,500. Bob’s brother received nothing, as he was not listed as a beneficiary on the life insurance policy. Bob’s family (mom, dad, and brother) didn’t even know that Bob was the beneficiary of this forgotten life insurance policy.

Bob felt kinda strange about this. He decided the best thing to do was to give his brother about $8,000. That would have reduced Bob’s share to about $15,000. Had Bob’s brother actually been one of three original beneficiaries, then Bob would have only received about $15,000. So Bob decided that he would cut in his brother, and then only take about $15,000. Well, Bob’s brother didn’t seem too excited about being given $8,000. In fact, Bob’s brother called their mom, and then Bob’s mom was mad that Bob wasn’t giving the brother half. She felt that Bob was being selfish. Bob was absolutely dismayed that his generous gesture was dismissed as greedy.

Here are some other factors to consider

• Bob didn’t feel comfortable asking the cousin to cut Bob’s brother an $8,000 check too.
• Bob’s grandma had nearly 24 years to change the beneficiary on her life insurance to Bob’s brother – she chose not to.
• Bob is 31 and his brother is 23.
• Bob’s mom and brother both think Bob is being greedy.

What do you think? Feel free to leave a comment, or simply vote in my poll below.

Pete the Planner, causing awkward moments since 1977.

Whether it’s happened already or not, you will eventually switch roles with your parents. They will look to you for guidance. They will look to you for care. And they may even look to you to help them financially. This is inevitable in one way, shape, or form. I’d be lying if I told you that it isn’t sad. It is sad. And we’re talking about it on this here web log because it can have a serious impact on your financial life.

No one really knows how to retire. Most people have never done it before. So when the time comes to retire, or in other words when it comes time to give up your earned income, many mistakes can be made. People often retire too early, with too many expenses, and without a health care plan in place. But what do you care? You’re in your 20s, 30s, or 40s (if you’re in your 50s and 60s and you read my blog, thank you, and I’m sorry some of my pop culture references are lost on you), so you have your own things going on. You are getting married, having kids, building careers, etc etc. All you generally know about your parents’ financial situation is that it’s probably better than yours. And THIS is where the trouble begins.

We are relative thinkers. We hold ourselves in a certain regard, and anyone that seems to be in a better spot than us, we hold in high regard. It’s kinda odd, but that’s what we do. If someone is relatively more successful than us, then we generally remove the relatively, and simply call them financially successful. This most often occurs with our parents. They generally have more stable jobs, bigger 401(k)s, and they don’t have the same material expenses that the typical young American family has. All this adds up to assuming that are parents will be fine when it comes to retirement. That’s a mistake.

At first, it seems like none of your damn business. But it is. Well, it will be. Unless you gave your parents a flaming bag of poo for Mother’s and Father’s Days, then you will most likely be dealing with their estate when they pass away. You will liquidate their assets, pay their debts, and keep the rest. No matter how much money they have, this process sucks. If your parents are adequately prepared, it sucks. And if your parents aren’t adequately prepared then it REALLY REALLY REALLY sucks. The sooner you have a conversation with your parents about their retirement and estate plans, the less the situation will suck. Remember, it’s still going to suck.

So how exactly are you to say “Hey Pops, I want to make sure everything’s cool when you die”? It’s not as cut and dry as death. You actually want to make sure everything is cool if they live. That’s the whole point. They need planning. They need retirement planning, long term care planning, and estate planning. These are things that you and I generally don’t think about on a daily basis. The best way to bring it up is with a casual “hey, can you walk me through your retirement plans so that I know what my job is?” That will inevitably raise a “huh?” That “huh” is a good thing. It gives you a chance to say something like this:

I’ve been doing a lot of reading on financial stuff recently. I found this really (pick your favorite fawning adjective: smart, funny, handsome, potent, ginger) financial writer named Pete the Planner. He had a post the other day about your parents’ retirement and estate plans. He says that I should know what’s going on so that I can step-up when necessary.

See, that wasn’t that awkward. Make sure that your parent knows how important it is to you to help them. You aren’t doing their planning, you are simply trying to find out what their plans are. And if they don’t have any plans, then badger them until they get it done. It’s at this point in time when you realize you have officially switched roles with your parents. “Get your homework done. Clean your room. Take out the trash. Get your retirement, long term care, and estate planning done so that you don’t leave the entire family hanging.”

Have any questions? I know a potent ginger that may be able to answer them.

A lack of financial literacy is about 15% of the problem. A lack of financial restraint is the remainder of the problem. This site was created to help you with both. What helps with restraint? Motivation. Think of me as your financial Richard Simmons. Wait. I changed my mind. Don’t think of me as Richard Simmons.

Anyway, I’m here to help.

I like fish…now. I didn’t like it when I was 10 years old. It sucked. I hated it. Hell, I was 10. I remember on one particular occasion my mother made me eat rainbow trout. The head was still on the fish. I didn’t want anything to do with it. My parents made me sit at the kitchen table for three plus hours until I ate the fish I was given. I wasn’t happy. I would stare at the fish, and it would stare back. The head was still on the stupid thing. My mother was a masochist. I swore at one point it had flipped me off. I wanted it to die, but it was already dead and I was required to eat it. I ate it. I ate it nearly four hours after it had come out of the oven. I had no choice. The longer I sat there the more I hated it. But the longer I sat there the more I realized that I had to put the fish in my face for it to go away. I’m still half-pissed about this.

What do you hate about your financial life? We all hate something. No matter how well things are going, something is bothering you. I have financial crap bothering me. I try to ignore it, but I shouldn’t. You should never ignore what’s bothering you the most. The actuality is you should put it in your face. You need to stare your cold fish in the eye, and bite its damn head off.

The oddly comforting part about this concept is it affects us all. If you are in one of the last two stages of your financial life, you can still suffer the rash of financial stress. If you are broke as hell and feel like you have no way out, you can feel the same stress. This financial reality is what haunts us. Well, that and bad hair days.

What swims in your head and taunts you? What aspect of your financial life is a four hour old cooked fish that threatens the sweet memories of your childhood? I don’t really care what it is, you need to address it. I’m saying this to you because I’ve recently stared my financial stress in the face. I’m exactly like you. I’m human. I hated it. I faced it begrudgingly, and earned the right to feel better. Want to feel better about what’s bothering you? Earn the right, and put the cold fish in your face.

• Do you need to buck up and start that retirement account?
• Do you need to pay your parents back the money you borrowed?
• Do you need to start your student loan payments?
• Do you need to confront a spouse for an out-of-control spending problem?
• Do you need to admit a financial lie to a loved one?
• Do you need to start a college fund for your child?

Things were going so great…until I was mistaken for another Peter Dunn.

While I try to help people take responsibility for their financial lives, the other Peter Dunn encourages people to leave the United States in order to avoid paying taxes. This mistake was originally brought to my attention by a Twitter follower, but then I noticed the increased web traffic on my website today. People have been Googling “Peter Dunn don’t pay taxes” all day. Ugh.

So for the record. I pay taxes. You should pay taxes, and the other Peter Dunn needs to stay out of the news. The world doesn’t need two Peter Dunns.

****Update: To be fair, I don’t know the ins and outs of the “other Peter Dunn’s” perspective. I’m not trying to insult him or his cause. I just wanted people to make sure they understood that we weren’t one in the same.

****Update #2: I really had no idea what the hell I was talking about. The more I read about Peter Dunn’s problem, the more I see that it is a MAJOR problem. I refuse to remove my original asinine comments. I deserve living with my initially prejudiced words. Peter Dunn, I’m sorry.

****Update #3: Peter Dunn will appear on Peter Dunn’s radio program Friday night at 7pm EST on 93 WIBC. We will get to the bottom of this entire issue. You can listen online.

I’m laying in bed right now. It’s pitch black in my room – except for the glow of my iPhone. Mrs. Planner is asleep next to me; our son is due any day now. She would punch me in the throat if she knew I was blogging right now.

I haven’t blogged recently, but that doesn’t mean I’m not working on stuff for you. I have several exciting things working right now. Here are some that might interest you:
-You can still sign up for 60 Days to Change. This is a structured program that will help you change your financial life on just 60 Days. The program begins April 2nd, and it’s brought to you by my friends at ELFCU.
-My radio show is going strong on 93 WIBC FM. I had a radio show on an AM station for three years, so it’s nice to actually hear my voice, and not just AM static and crackle. I have a new segment on the show called “Financial Speed Dating.” It works like this: you email me a financial decision that you are trying to make, I’ll call you, and then we discuss on the radio show. At the end of the 10 minute segment, you will have the definitive answer. It’s fun, and more importantly, you can get a tough question answered.
-The Molly Project is going strong. Molly has made some great strides. I hope to bring you an update very soon.
-I’ve completely changed my mind about whether or not a married couple should have separate banking accounts. More on that next week, baby willing.

-I’ve noticed that single dudes spend a ridiculous amount of money on food. For them, food, beer, and socializing get rolled into one category. This gets expensive. I’ve come up with a brilliant solution for this. You guessed it, more on this later.
-I saw some amazing strides made by clients in the last few weeks. It works like this. My “Should I Meet with Pete” clients meet with me for the first time for 75 minutes. In that time, I learn EVERYTHING about their financial lives and habits. I then give them three very specific tasks to accomplish prior to our next meeting (a month later). It’s a test. At the beginning of the next meeting, the clients report on their progress. Most of the time it’s magical. Sometimes it’s not. It truly is amazing what people can accomplish in 30 days with the right technique, motivation, and confidence. If this seems like it’s for you, then click on the green button in the sidebar which reads “Should I Meet with Pete?”

That’s about it for now. Things may be a bit quiet for a while. I’ll be giving my son the undivided attention that he deserves. Gotta go. I don’t want to wake the pregnant lady laying next to me.