A Race Against Time: Buying A Dream Home With My Parents

Dream Home Hawaii

A dream home is what we all dream of. A dream home is like a forever home to live a great life.

Every time I travel for business, one of my favorite activities is to attend a broker's tour to get a feel for the local real estate market. The activity is free and enables me to talk with people who have intimate knowledge of the local economy.

All indicators in Oahu show there's weakness in the luxury market, defined by homes priced over $2M. The pattern is the same in SF and NYC, which makes me worry since weakness tends to start at the top and work its way down.

For kicks, I visited one property in Kahala, my favorite neighborhood in Oahu, with an asking price of $6.7M. It has 9,000 square feet of living space on a 15,000 square foot lot. Every single room felt like I was in a Las Vegas casino or on a cruise ship. It felt gaudy. When I asked where the sellers were going, the agent told me the owners finally bought a beach front property across the street for $20M!

Eleven years ago they had wanted a beach front home, but “settled” for this $6.7M house instead. Last year they finally bought their dream home and have spent the past year remodeling.

Here's the kicker: the husband is turning 81 this year! He's a real estate developer from the San Francisco Bay Area.

Waiting until you're 80 to buy a dream home is perplexing. Perhaps when he was 70 he simply couldn't afford $15 – $20M? Alternatively, maybe some time in his mid-70s he realized that he had way more money than he'll ever need. He could die tomorrow, so why not ball up and buy the property he's always wanted?

The Dream Home And A Race Against Time

I'm sure there have been many times in this seller's life when he has thought to himself, “I can't take it with me, so why not enjoy my money to the maximum now?” NowadaysI think about more responsible ways to spend my money all the time. But it's just so hard for me and many others who've been so frugal all our lives to open up.

“Consumption smoothing” is an important concept to address because it helps improve the quality of our lives. You don't want to die with too much left over because that means you worked too hard and saved too much earlier on. You don't want to die in debt either, because that means you didn't properly manage your finances, felt constant money stress and are likely leaving surviving kin with a financial burden.

Imagine taking 30 years before becoming really rich. During this time perhaps you lived very frugally. Is your life today really better than the person who spent much more freely from ages 20 – 50? Hard to say. I'd much rather enjoy a more consistent spending pattern. We just tend to save more than we need because the future is uncertain.

Combatting Time And Middle-Age

At almost 40 (now 45), I feel the race against time more than ever. I have this stretch goal to buy a dream home in Hawaii before the age of 50. I've got 11 years to come up with the money. Yet each year I try and save is one less year I'll get to enjoy this dream home. The home has to be at least 50% nicer than my existing home or else why bother? As a result, the new home will also cost at least 50% more.

I chose age 50 because I'd like to actually enjoy my current home for at least 10 years before I die. Ten years goes by quicker the older you get. My hope is that I live until 80, but just in case I don't, I'm hedged from an early death, unless I die at 51!

Don't hate me for my desires. I'm content living for the rest of my life in my cozy ~1,910 square foot home. It's got a nice master bathroom, three bedrooms, one office, parking and panoramic views of the Pacific Ocean. What more does a family of four really need? It's just fun to have goals. They make working and saving more meaningful.

Hawaii Dream Home
The living area of the master bedroom suite of a Kahala home asking $4.75M. Good place to write!


Although I feel the time crunch, my parents at ages 68 and 70 feel it even more. I'm lucky both are still alive. I have every intention of spending as much time with them as comfortably possible and also taking care of them if that becomes necessary.

They presently live in a perfectly fine middle class house. It just hasn't been updated in the 30 years since it was built in 1986. I've been coming back to this house to visit for almost my entire life. Meanwhile, both our fortunes have grown significantly since 1986. For example, I, for one as a nine year old, had a net worth of maybe three bucks in quarters. Now I'm free!

Remodeling is a PITA, so I thought of a great idea. Instead of remodeling the 30-year-old home that might take six months and a lot of stress, why not rent it out and have them move to a new dream home! Renting out a home that hasn't been updated in 30 years feels terrific. I won't feel as bad if the tenants bash the walls or break the appliances.

I'm not sure my parents ever expected me to do very well financially. After all, I went to a state school that was not a magnet for the highest paying jobs. But my money is in the bank and I'm happy to spend it on them now. When I talked to my father, he also has a decent amount of excess savings despite having a pension. Why not combine our finances to enjoy a fantastic property instead?

Life expectancy at birth by region around the world

Benefits of Buying a New Dream Home

* Newer house should mean less things to fix. Many of the houses I'm considering have been rebuilt since 2013.

* The dream house will be on one level to make walking around easier for my parents. Since my knees are starting to hurt more, I appreciate less steps as well.

* More privacy. I've noticed many of these nice homes in Kahala have tall walls and huge trees surrounding the property. It feels amazing to shut your gate and go skinny dipping in your pool if desired.

* My parents can live in a much nicer place for the rest of their lives.

* A larger, single level house means it'll be easier to cohabitate eventually and take care of my parents.

* My parents benefit from a large injection of funds from me to live a better life, while I'll get the satisfaction knowing my money is being put to great use.

* If we can get a mortgage, we'll be taking full advantage of record low interest rates.

* Every time I visit, I'll be able to stay at a nicer home. My realistic scenario is to spend for 4-6 months a year in Hawaii, live in San Francisco for 3-6 months during tennis league season and travel for 2 months a year.

More Great Benefits Of Buying A Home In Hawaii

* The house will eventually be mine to enjoy full-time when I'm much older. Perhaps the cycle can repeat again with my own children.

* Potentially generate $40,000 – $50,000 in annual rental income from the old house.

* Maximum consumption smoothing as the money that's just being saved and invested by me gets used to provide my parents a more comfortable life.

* Could make money on the investment. Inventory in Kahala has spiked by 50% over the past year. This means low ball offers are more likely to be accepted. I've got this incurable habit of trying to take advantage of opportunity.

A 4/4 house in Kahala with your own cave. Amazing grounds asking $3M.
A 4/4 house in Kahala with your own cave. Amazing grounds asking $3M.

The negatives of buying a dream house:

* More property taxes, maintenance and expenses. I could just invest money with a real estate crowdsourcing company like Fundrise for potentially double digit profits and no hassle.

* Massive new mortgage since we can't pay $3M+ cash. I've been on a mission to pay down my mortgage over the past two years and it's felt great.

* Need to find new tenants for the old house. Will hire a property manager to make management easier.

* What if my parents don't like the new house or the neighbors?

* Moving is stressful.

* More responsibilities.

* There's less freedom living with your parents, although we're looking at bigger houses with 4,000 – 5,000 square feet of living space. For example, one 5,000 square foot house we viewed has a separate 420 square foot cottage where my mother said she'd enjoy staying.

* Could lose money if I get into financial trouble and need to sell.

Diamond Head Dream Home
A Diamond Head home on 1 acre of land with a view asking $6.9M. Cannot afford.


A simple life is fantastic. It's the reason I was strongly considering selling one of my rental properties earlier this year. But now that the new tenants have moved in, I no longer have the strong desire to sell. It's just having to deal with an HOA that bums me out the most.

Buying a dream home is a complete 180 from my earlier thinking. But the reason for the change is mainly because I want to provide what's best for my parents with the time they have left. They live in a tired two story house with a noisy neighbor. By leaving the logistics up to me, I can rent out their old house, free up $40,000+ a year in retirement income for them, and let them live in an amazing new house if we can combine our finances.

Ultimately, money is meant to be spent. It's seems like a waste to have so much left over in savings after you die if you live a middle class lifestyle. If you lived a top one percenter lifestyle and then had money left over, that would be a different matter.

If my finances can help make my parents' lives better, what's there to lose? It just comes back around. Then again, staying in this old house in Kaimuki with newly installed local AC units and newish windows seems perfectly fine as well. After all, the beauty of Hawaii is in the outdoors. Now if I can just convince my father to upgrade to faster WiFi…….


Buy Property For Lifestyle First, Rental Income Second, And Principal Appreciation Last

Retiring In Hawaii: The Pros And Cons

Beachfront Or Ocean View

Invest In Real Estate More Strategically

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Real estate is a key component of a diversified portfolio. Real estate crowdsourcing allows you to be more flexible in your real estate investments by investing beyond just where you live for the best returns possible.

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Fundrise Due Diligence Funnel
Less than 5% of the real estate deals shown gets through the Fundrise funnel

Shop Around For A Mortgage

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91 thoughts on “A Race Against Time: Buying A Dream Home With My Parents”

  1. Maybe approach the houses you want to buy or scour the rentals that are stagnant and offer to rent them for $5000-$8,000 and rent you kaimuki house for $5000. You are the negotiator. I had seen a very nice Hawaii loa house in Aina Haina school district the house was beautiful the owner did a 10 year lease at a reasonable price as they just wanted consistent income without hassle and risk of someone wrecking their investment. Home sellers sometimes worry about how are they going to invest their money and get a return, as stable longterm renter u can solve that problem for them.

  2. Interesting timing on your article! So I can confirm that sales on homes above $2M are weak compared to the rest of the housing market. I put my home for sale in early May and have had an average of 2 showings a week, activity is still strong. I think there are lots of tire kickers of course, but I live in an affluent area, my home is (okay I’m biased) specular waterfront on a peninsula. Feedback is its not pricing, but all the higher end buyers are really cautious right now and understandably so. I’m fortunate that I paid cash at the absolute bottom of the market and my value has skyrocketed, I think some people see that and they think they’ll just wait for the next crash as well, but that may not happen for a long time…nobody knows and as you say life is short and you cannot take it with you. I’m happy as a clam staying put if need be but I’d rater have a smaller property in an awesome location (Hawaii like, but not necessarily there). Long term you cannot go wrong being in the extremely desirable locations like that. I would suspect though that a lot of the owners are similar to me though and the place is paid for so they have infinite staying power, what you need to find is that one guy that overextended himself and is now distressed. Those deals absolutely happen all the time, having cash and being ready to pounce is the key. Cash, close in 7 days will get you some real deals.

    On the shared property with your parents I’m a little mixed. If it were not Hawaii I would say no way, but I can see why that is an appealing option for you. Let me tell you what your future self will be thinking…like you alluded to many times life is happier the more options you have and the more simple it is. 10 years from now having to carry $40k a year in maintenance and taxes expense on your dream home is not going to be as appealing as it is today. You will long for the freedom of being more liquid. Now if you find that forever home that is distressed and has a spectacular view or is oceanfront, I can see pulling the trigger. Having a really nice house that simply looks out to a pool and great landscaping will get old. I’ve spent the first 18 months of my early departure from the workforce traveling and soaking up different environments, talked to tons of locals and other people in similar situations. The one common theme that has developed is the following…”after a few years even paradise gets old and you need to hit the reset button.” Some people are different though and I can understand wanting to have a permanent home in a place like Hawaii. My plan is to have a small but simple place that I can lock the door behind me and be able to leave for months at a time and not have to think about from a maintenance or a carrying cost standpoint. I don’t think you can make a huge mistake with what you are talking about since you know the area so well and your family is there, but my guess is your future self would like the options that additional liquidity provides at such a young age. Look forward to hearing how it shakes out!

    1. “10 years from now having to carry $40k a year in maintenance and taxes expense on your dream home is not going to be as appealing as it is today.” – I believe your statement. And the only way it stays appealing is if the home appreciates tremendously, or if I boost my net worth and income by 2-3X from here. I already pay more than that each year in property taxes and maintenance for my real estate portfolio. So getting to $100K/year in carrying costs sounds terrible.

      Pressing the reset button is why travel is great. Travel more! Going to Asia for four weeks last year gave me a lot of perspective. Going to Europe for three weeks this year helped kill the mundane. On the recent 10-day Hawaii business retreat helped keep the spirits high at my company.

      Having a wonderful home base or two feels amazing to come back to. It’s nice to explore other great homes.

      1. Totally agree, the nice thing is when you purchase from a position of power the worst thing that can happen is you lose a tab bit of your net worth % when you go to sell if you are forced into it for some unforeseen reason. I completely get having a nice place to come home to and the fact that your family is there and know it so well would have me not worried too much about making the call to do it. Also, a phenomenon that I recognized that happens to highly motivated people is when they do make a big purchase like that it kicks their dollar earning drive into overdrive. I was 39 when I wrote a $1M+ check for what I thought would be my 20 year to forever home…6 years later I would absolutely do the same thing again, it has been fantastic, but I’m ready for the next adventure so clipping this coupon and going onto the next seems like a great idea. 6 years from now I could see plunking down a big chunk of change again, but for now its not on my radar. I spent a month in Asia, a month in Latin America, a month exploring the national parks out west, 6 weeks in the Caribbean, and it has just heightened my desire to see more of the world and not have a big place to worry about. I think about it like this, I love where I’m at but how do I know its the best place if I haven’t been everyplace yet : ) Funny thing is that I go real estate shopping while I’m visiting these places too (well not in China lol)These are good first world problems to have!

        1. I’ve got an easy answer for you regarding the best place to live. If you haven’t lived in San Francisco, I can unequivocally tell you that San Francisco is it!

          I’ve lived on the East Coast, the south, the West Coast, and I visited the North West and Midwest many many many many many times before. San Francisco is #1!

          And I also grew up overseas for 13 years, and San Francisco is my favorite place for worklife balance.


  3. F.I.S.H. F-it-$hit-Happens

    Sup, love your site. I live in Honolulu near Bishop Museum. If I had your money, this is what I would do, learning from personal experiences.

    Remodel your parents house to make it VERY handicap/elder friendly with a/c! I’m talking about the entire house (bathroom, bedroom, entrance) being wheelchair (handicap accessible) friendly.

    Reason #1: Safety and comfort for you and your parents when they get fragile and immobile. If your elder parents get hurt, they can’t enjoy life. So trying to minimize accidents so they can live comfortably is important too. Plus, it’ll be less stress for you when caring for your parents, unless you hire a skilled nurse?

    Reason #2: You can use the family home for yourself and other family members in the future to care for one another.

    Reason #3: Since there will be a ramp, you can purchase a “mobility wheelchair van” for around $30k – $50k. That way you can transport your parents with ease to grab shave ice, some poke, or coffee.

    Reason #4: You can build an Additional Dwelling Unit (ADU, legal in 2016) on their property and live together, but in separate quarters.

    Reason #5: Home is home.

    Good luck in your decision!

  4. It’s funny, my mother and I are literally having the same conversation. She’s worried about not having money in retirement – which is only two years away. Sadly, she doesn’t have the money and just got a refi on her mortgage for 30 years. Even her refi is out of her budget when she retires.

    So, I’m buying her house and renovating it. She’ll live with us until she either passes or is forced into an assisted living home; however, until that day, she has a place to stay and financial freedom for the first time in her life. The downside is definitely being that 27 year old “living with his mom”, but it puts my son in a far better school district when he starts in a few years, and I get a home worth nearly $220,000 (after renos) and only purchasing it for $75,000 plus renovations. I’m looking at around $45,000 in total renos to update the house from 1983. So long as the market stays stagnant or gets better in 10 years, I’ll get my utility and money out of these upgrades.

  5. Yes, of course, you are not getting any younger, you’ll have your dream house, good investment and your parents seem to be flexible. It’s a win-win situation.

  6. just a thought

    I voted “other”. I say go for it, but use the rental income to offset some of the expenses of the new place (i.e. taxes, maintenance, insurance, etc) but not to be used for the principle or interest payments as that could really muck things up when your parents pass away.

    Or to make it simpler, have your parents capture the income and then pay you some form of rent.

    I am also a fan of the idea of you unloading some SF real estate and diversifying with HI real estate.

  7. Hi Sam,

    You’re plan makes long-term sense. And since you plan to spread you’re time between HI, San Fran, an traveling, everyone won’t go crazy with one another all the time, lol j/k. I’ve always said that spending on people (friends, family, donations) and creating memories gives greater pleasure than buying things. I hope to see you’re dream home plans come to fruition in a future post.

  8. We had that talk earlier in the year. My parents just retired last month, and have been looking to downsize for awhile, while we were looking to expand our house. The plans are in the work for building a new house with 900 sq ft in-laws quarters, with separate kitchen, living room, bedroom washer/dryer etc on the first level, with only a shared foyer. Most things are kept separate so we have our privacy, and aren’t in each others hair all the time, but taxes, yard up keep, utilities etc. are shared, leaving my parents more freedom to travel and enjoy retirement without house upkeep worries. As they age, we have the bonus of them living ‘very close’ if they need additional care.

  9. I’m from Kahala, there are signs everywhere…part of it is the sale of a large portfolio of real estate from an eccentric japanese billionaire who got caught on tax evasion charges.(google kawamoto Kahala) I think you could get more rental income than 5k/month on a place like that, I was looking at a Rental on Papu Circle and it was $15k/month in rent and the house wasnt nearly as nice as that. Its amazing how much prices differ from makai side of Kahala Ave to Mauka Side of Kahala Ave to Aukai Ave. Kaimuki isnt so bad, a lot of million dollar place there! Anyway, hope you get your dream home!

    1. Hi Ben,

      The $4K-$5K/month is for our existing Kaimuki home, not a the potential new Kahala home we’re thinking of.

      Speaking of Aukai Avenue, what do you think of that street?

      Just spoke to someone else who said Kaimuki is better due to the location, restaurants, and shops.

      Know about Kawamoto. Opportunity!

      Did you buy a Kahala home, or did your parents? What do you / they do? I’m always curious as to who can afford these homes.


  10. We have had similar talks, less about a dream home and more the possibility of creating a compound of sorts with most likely a much larger home in a remote area that if we choose to vacation, buy another home, etc our parents would be able to stay and take care of the property. Which would be a special interest to them as an opportunity to live closer to immediate family in a nicer larger house.

  11. I would not want to live in the same house as my parents or my in-laws. Part of that is that my family is crazy and I would have to buy the entire thing for them and I can not afford to do that right now. The other part is that we are still in the midst of raising our kids and have our own lives. My in-laws have health problems already. We moved to the beach (our dream home) in September and they have a summer home down the street. While it is nice to be around them and good for the kids, I also enjoy when they go home in the winter. My father in law has dementia and it is starting to become difficult. He is really mean and negative to the kids and they don’t quite understand. Unfortunately, they may now remember him this way.

    That being said, now that my father in law has dementia and can no longer drive or take care of anything, my mother in law has become very indecisive. Their goal was to renovated their beach house, sell their main home and move to the beach when my father in law retired…..it never happened. Now she is letting both houses go and will not decide where she will live for her remaining life. Between medical bills and the maintenance of both homes (which is minimal because she doesn’t do anything), taxes, etc., she is being foolish with their money. We have had conversations with her and have met with an estate attorney several times and she still doesn’t know where she wants to be.

    I hope she figures it out soon. We are pushing for her to move where we are so we can help them in the future, to no avail. But again, I do not think I could live with them at this point in our lives.

    Good luck to you in your decision!

    1. I’ve got a feeling that MANY families are crazy or have a crazy person. Why is that? Is it just genetics that we turn crazier the older we get?

      I’m jealous you got to move to your dream home by the beach! How did you achieve that feat, how old are you guys, and what do you guys do?

      1. Well, when I say “dream” home, I mean dream location. haha….the house is not all that, but we can walk to the beach. I am 37 and am a commercial real estate appraiser and my husband is 38 and manages a liquor store in a beach resort area. He can actually bike or walk to work.

        We achieved it by saving approximately 47% of our income. Actually, we lost money on the sale of our other house, which we settle on tomorrow, but had enough saved up for a downpayment and jumped at the opportunity since my husband has always wanted to live where his parents have a summer home. Our other house was only 15 minutes away, but our heart is at the beach. I am happy we are selling our other house tomorrow, we have been holding it for too long. I will be glad when we can start aggressively saving again. But, I do love we live and am happy we bought our current home.

  12. Doesn’t have to be on Oahu? You could probably buy a couple of acres on the Big Island and set up a few different properties. Either way you look at it buying land and designing the home around multifamily living is going to make the lifestyle much more palatable in the long run. You need to take care of your parents. He’ll get a lot more satisfaction from that than you ever well from saving. Or even investing… But you also don’t want to set yourself up for family drama. Make sure the house would give everyone the lifestyle they need one not being on top of each other. I really don’t see the financial risk… Worse comes to worst you have a few other properties you can liquidate if needed. Pay down those mortgages ASAP.

    1. Family drama is definitely a concern. Buying a land and building may take 2 years. Given this is a race against time, the 2 years might be too valuable to waste at this stage in life.

      I’m thinking if I go through w/ this, I’ll sell one property in SF to keep my exposure to real estate relatively steady.

      1. Don’t go into the building business unless you have the money. My parents started building our house in 1991 and it’s still not done (back stairways still has to be done)! It’s been a nightmare living on a construction site! And after a couple of years, the maintenance of a house kicks in!

        I voted yes. I live with my folks. They wouldn’t be able to financially take care of themselves otherwise. That said, I do wish the house was bigger.

        I think buying your parents a house to live in and enjoy while they’re alive is worth it. When you go there on vacations or to visit, you get mom’s cooking and a place you feel truly comfortable.

  13. Great stuff, as always.

    A thought on the 80 year-old and purchase of the $20 million home… Depending on the way the title is held (for both new $20mm, and old $6.7mm), it may be a way to protect assets placed in a spillover Trust from potential lawsuits. Hawaii’s property laws are different than California’s, and direct assets can be protected as Separate Property (HI is a separate property state), Community Property (CA is a community property state), and inheritors in other states (not Hawaii) can be shielded from their state’s Estate taxation laws (if any).

    Just the first thing that popped into my head, there has to be a better reason for this guy than the feel of toes in the sand.:-)

    For most of us, the maximum exclusion per married couple of $10.9 million (as of 2016) should cover it. Only 1 out of 2,350 couples exceeds that limit, so there are not too many people in need of specialized Estate Planning. But it looks like this couple does!

    1. One more thing, if this is not the owner’s primary residence in Hawaii, and he and his wife still declare residency in CA, then this $20 million home can be purchased as a real estate investment with self-directed IRA funds, through their Estate and Trust. The disposition of assets and wealth, after the decedent’s passing, would be considered differently if distributed over time through an Estate and Trust.

      Very advantageous in tax-avoidance for the recipients.

      Also, the sale of the $6.7 million home not only captures the $500K capital gains exclusion, but excess capital gains can be rolled into the acquisition cost-basis of the new property.

      1. JayCeezy, could you tell me where I can read more about this particular situation you talk about above? My situation is I’m single, my cap gains would be significantly higher than the $250k exclusion I’m allowed. So if I buy a home of similar price within a certain time frame I can avoid the cap gains? My tax guy told me the opposite…he said, well if you get married it will save you big bucks in the year you sell lol.

        Interested if this is a state by state thing. Thanks!

        1. nbsdmp, nice to hear from you, sorry I was not clear in differentiating…there are no Capital Gains if purchased as investment with self-directed IRA funds, as the entire amount will eventually be taxed as regular earned income. The advantage to doing so, and holding as Separate property in a Trust to be passed on to heirs, is any increase in value occurs untaxed and can be passed to heirs into their self-directed IRAs.

          Your CPA is correct, home sale enjoys a $250K/individual, $500K/married capital gains exclusion. And that would be for a purchase with post-tax funds. No chance to offset any Capital Gains. I believe you live in Michigan? If so, the state taxes all income as regular income (no different lower rate for Cap Gains); still, a good problem to have!:-) I’ll be more clear in the future, continued success to you!

      2. I just want to correct some misinformation in JayCeezy’s post. The old “rollover” rule was eliminated in The Taxpayer Relief Act of 1997. The $500K gain exclusion for married couples replaced the old rule.


  14. I think it’s much smarter to rent a dream home than buy one. I think most people see a dream home and imagine they’ll love coming back for years and years, when the reality is its like a new car smell, eventually it wears off but the $10,000 a month mortgage payment doesn’t. That said, it would be a fun story to have for later in life, I just can’t think of a justification financially

    1. You just want to live a better life the older you get. You won’t be moving around as much, so the value of your home increases.

      After I left corporate america, I appreciated my home more b/c I spent at least 5 hours more there a day than when I was working.

      Your thoughts will change at 40 versus 25. But it’s hard to explain until you get to that age. Enjoy your 20s!

  15. Crystal Ball

    Voted Other. My parents divorced long ago and both remarried. Definitely wouldn’t work to live in same house with either set of them – let’s just say personalities wouldn’t mix, to put it mildly… :-) Dad will leave all his (wife’s) money to their favorite cause or my siblings so no chance of merging resources. Mom is broke and living in a house 5m away from my house that I bought a few yrs ago. Both houses are in one of the nicer mid-tier neighborhoods 10m from downtown SEA. I subsidize her rent by 25+% or she couldn’t afford to live there. The stairs are starting to get tough for her, so we’re working on plan to get her into a cheaper one story place in smaller more rural town near a couple siblings in next 2 years, hopefully sooner. I’ll continue to help financially and siblings will handle in-person help. In short, with my family, separation is best, and anything I want, including FI, is 100% up to me and my wife. I imagine I’m not the only reader in that boat. (My wife’s family is all out of country, but may leave a little money when we much older….we don’t count on that). That said, we’re tracking pretty close to your FS method numbers for the avg net worth for above average married couple, so helping mom has slowed, but not derailed, our financial goals. We’re – mostly – happy to help, but honestly, if mom hadn’t been very irresponsible with money she wouldn’t need help to stay near SEA when rents starting skyrocketing a few yrs ago. That’s tougher for my wife to deal with than for me, of course. It’s a frustration we chose to get over. My siblings and I are starting to get more serious about planning for mom’s old age and long term care with assumption she’ll have no money. My siblings inherited my mom’s financial irresponsibility and dreamy worldview so they are all poor as s*** too. They’ll take point on physical care and I’ll manage all things financial to keep them all out of (more) trouble. This will be fun, NOT. :-) I tell you what – dealing with my parent’s dysfunction is motivation to never be a burden to our 2 kids! Congrats on having financially secure parents you can happily live with!

    1. I hear you on family issues. A lot of it has to do with ownerships, succession planning, and money. This is why the clearer we can define ownership and the earlier we can talk about money, the better.

      Good luck w/ your situation!

  16. I love this idea, but would be thought you were crazy until recently, when my husband, 4 young kids and I had to move in with the in laws for a few months while my husband changed jobs and we house hunted. I was dreading it, but it was a wonderful experience. I would have considered moving in forever if they hadn’t lived an hour from my husband’s work, and they wanted us to stay, too. I think a lot of people in their 30s like me get very nervous about this idea, but I’m glad I got the chance to see how great it can be!

    1. Nice that you had a good experience. It’s always a little tougher for the spouse who isn’t staying with the parents I think.

      It’s important we face reality about age. The sooner we do, the sooner we can test drive different scenarios and plan.

  17. Staci @Streamline365

    Love this, my hubs and I discuss this all the time. When will we have enough saved that we feel comfortable? When will we go on that dream vaca? Many “experts” would say we can afford it, but I have a hard time biting the bullet and spending the money. It feels AMAZING knowing we CAN do it, and I get great joy out of that, but I’d love to know how it feels to actually just GO!

  18. For now, my parents have more assets than I do (I’ve got none lol) in the form of real estate but despite having so much property they’ve refused to sell any of it to help themselves let alone for enjoyment, at least until recently. I think things have finally gotten bad enough for them to have to sell, which I’m glad because it’ll be less of a burden on myself too and because they’re gonna see how much better off they’re going to be. **Life willing**

    As for living with the parents I personally wouldn’t be able to though it’s fairly common among my fellow Latinos.

      1. Hey there Sam,
        I think that the main issue was that they didn’t have a plan after they decided to buy a house. They were able to buy a nice home from all the cheap real estate in 2009 but I think my mom was over confident on their ability to manage their finances because she too eventually suffered from the declining business environment to the point that she had to close her business. They became solely reliant on my dad’s retirement benefits and their $10k in savings to get by until my dad developed some rare illness which left them savingsless. There were other factors that exacerbated things but that’s the gist of it. I just couldn’t understand how (especially) my mom just wouldn’t sell any one of their/her properties knowing they were in dire need of money?

        And yes, they’ll probably end up leaving these other properties for me and my other three brothers to have to fight over once they’re gone but I would much rather they sell them and use the proceeds to cover for their health expenses and for their pleasure so that I don’t have to pitch in too. I don’t mind helping out my parents but if they have the means to help themselves why burden others especially when it’s just me helping them. We had the same issue with my late grandfather (mom’s side) so I’m pretty sure she’s gonna want to pass that property down to me along with her own. And my dad, well, he goes with whatever my mom says even though he’s not as attached to his own property as she is. I get it, there’s sentimental value in each of their acquired properties, whether it was attained through their individual/combined hard work or inherited from the hard work of their late parents but it’s still just property – a resource to be used to attain happiness while you’re alive, no?

  19. You are right on the 2m price point, my uncle and aunt bought a totally remodeled 1st gen Kahala house off Hunakai earlier this year for 2.1m. Not beach front but I thought it was a pretty sweet deal considering it was pretty much an new house.

    Kaimuki is my hood too! Wait a few years and it will be the next Kahala…..All the Kahala people already come to Kaimuki to eat. :)

    Good luck on your hunting!

    1. Very cool. What does your uncle and aunts do? I’ve been waiting for Timonthy to be the next Kehala given become a key location is so money, but progress seems to be slow. I’m noticing more and more new houses being built in, key, but the lots are not that big and the house are still relatively modest. But the views to the city and to the ocean in Diamond head are great!

      I’m thinking about offering 25% below asking for this one house. There’s so much supply in Kehala that I can’t imagine a seller ever selling anything right now.

      1. They are both retired and have been blessed and fortunate to have done very well in their respective careers to make Kahala happen.

        Driving home from Starbucks Kahala Mall the back way – Kilauea, Pahoa I do see a lot of for sale signs. I hang out at one of my gear head buddies that lives on Puu’Panini and I see some for sale signs in that neighborhood. I see some signs on Papu Circle too. I read somewhere the Ossipoff house might be for sale (?). That would be a cool pad.

        Kaimuki with AC = Kahala on a nice trade wind day. Sorta. :)

        Let me know if you take the plunge, we can celebrate at Avenues or Side Street Kapahulu :).

        1. I’m at the top of the hill in Kaimuki overlooking the city and part of the ocean and Diamond Head. There’s a lot of natural breeze up here already!

          Kaimuki #1 location in Oahu! I might have to write a parrallel post like the one I did for SF!


          I would love to know what your uncle and auntie did to afford a $2.1 million house. And whether they paid cash or took out a mortgage. Give me some insights!

          1. Top of the hill! Classic! I’m down lower.

            They did what you are trying to do – pooled $ and cashed out on the Kahala house. It’s working out beautifully. Best neighborhood on the island, smaller house, walking distance to the mall and super market. Ideal set up for a 70+ year old couple. As Ben said the Kawamoto deal escalated the prices on Kahala Ave but I think the side streets like Aukai, Elepaio, Koloa, etc still have a few gems if you look hard enough. Funny thing is my uncle said one neighbor is a Dr. and the other is an attorney but he never sees them at home. Probably to busy working to pay for the house.

            I drove back from Starburcks Kahala Mall this morning via Pahoa and the cool house on the corner of 14th (diamond hard side) with the tennis court (?) in the front yard….That’s a pretty cool house! I say buy something bordering Kahala – You get the Kahala address but the Kaimuki prop tax rate. :)

            Good luck on your hunting!

  20. You didnt provide enough information. As I recall, you mentioned before you have a sister. While it is your parents money and they dont need to ask for permission to spend it, your other siblings might expect an inheritance. Just food for thought.

    1. Good point. Good to have a dialogue with the sister and see whether she would want to lay claim on anything or come back to Hawaii to live. But so far, she has said she wants to stay on the East Coast as that is where her life is. We’re actually having a family gathering right now and she went to see the place with my parents. Maybe she can lend me some money :)

  21. How much does it cost to rent a home there? Maybe do a test drive to see if it works – rent your current parent’s place for 2 years and use the proceeds (+-) to rent something there for the same amount of time. If everyone is happy at the end of the two years, buy something there. I’m always a fan of try before you buy – especially with big money on the line.

    We’re hoping to retire in our mid-upper 40s and are considering buying a place in the Carib with our folks. Will be curious to hear what you decide and how it goes afterwards if they move.

    1. Hi Rob, I think it may cost about $15,000 or so a month to rent over there, which is sound very painful when I write it out. But somehow it feels much less painful to pay a $10,000 a month mortgage, and 2000 a month and property taxes, and another $2000 a month and utility bills and maintenance and garden.

      I agree with you. Trying before buying, especially a large ticket item is a no-brainer. If more people could do that for cars, I feel less people would waste their money as they would get their thrills out of the system. Maybe this is a good Business idea!

  22. I picked other. I do currently own a 2 bedroom condo on the panhandle of FL with my parents. It is actually the first property I ever bought. It is 15 minutes from my siblings house. Originally it was a tax break for me and my parents were thinking of being snowbirds with us subsidizing our overall cost by renting it out during the rest of the year. We’ve owned the place for 13 years and the most time in 1 year we’ve spent in it was maybe 4 weeks.

    I wouldn’t mind owning a dream home with my parents but they aren’t ready to move yet. They love their neighbors, neighborhood and house. If they get to the point where they want to move I doubt it will be to a place I’d pick to inherit some day.

    1. May i ask why you wouldn’t want to inherit the place one day, especially if you found a place you decided to help buy for / with them?

      My whole idea is to find a dream home now for them to live in, but also for us to also enjoy in our advanced ages.


      1. They are currently still living in their dream home. It’s the home they bought when I was 4. They love their current neighborhood and honestly I don’t see them moving out into another home. They bought a property on a lake when I was in college so 15-20 years ago with the idea of tearing down the cottage and building a home. They never did because they could not get motivated to move out of their current house. At this point based on past experience I think they will stay where they are until they absolutely have to sell for health reasons which will likely mean moving into some sort of assisted living type arrangement. At this point they have considered and dismissed moving into a smaller house in their own neighborhood even.

        I wouldn’t have a problem having them move in with me but I live in a different city than they do. I don’t think they would have any desire to move away from their town to be with me.

  23. Personally I’d prefer to keep things more separate and just give my parents some money each year to enjoy (or pay for their vacations directly). Buying a house together is too complicated and you never know if one parent will remarry after the other one passes away, making everything even more complicated. But I’m sure it could work wonderfully in the right situation!

      1. I never thought that would happen either until it did.Dad(73) passed away 3 years.My stepmom( now 72) remarried their former neighbor(77) last year.Found out about it on Facebook of all places ! There could be complications in the future.

  24. Hi Sam

    Sounds like a mutually beneficial potential plan/setup! You and your family get the dream home and a more preferred lifestyle sooner, and your parents get help/support/care as they get a little older and potentially need it.

    I’d say the financial side of this equation is the less important one….don’t get me wrong, it’s not unimportant – but the personal side and how the family dynamics are affected when all under the one roof is the key. If that’s all good and everyone is on board after weighing their individual pros and cons…..go for it!


    1. Family dynamics are so important. Oh gosh it is tough to please everyone. But please everyone is what must happen before such a big transaction / life event occurs! The easiest path is to always just do nothing. It is probably the path we will take, as a lot of things need to work e.g. getting a large mortgage, etc.

      The nice thing about Hawaii is that there is a “FREE LOOK” phase of 12-15 days. You can put down $25,000 in earnest money and walk away w/ your money back after 12-15 days inspection. And if you don’t qualify for financing, you can walk away too.

      I have endless energy to wheel and deal regarding real estate. I’m crazy like that about property. But my parents do not.


  25. Maybe you could test-drive it for a year by renting a dream home with your folks in tow, see if it works for you and them. It’d be worth the added cost to find out. Or maybe a compound approach would be better, live on the same lot in different buildings.

    1. A test drive could be a great solution. I’ve asked them to rent one of those nice condominiums downtown for a week to see how they like it. I’ll ask them again now that considerations are more real.

      Just renting a nice place for $3,000 a month is a great option b/c if they don’t like it, they can just move back and not miss out on tons of money.

      Renting could be the perfect solution for older folks! But there is no investment that could pay dividends in the future.

  26. No, I wouldn’t because I consider my parents short sighted and irresponsible.

    There is no “combining” resources in my scenario. I’ll essentially be buying them a house, which would be completely unnecessary if they had saved and invested wisely in the first place. I see how it makes sense in your scenario. Great post.

  27. Sam,

    Hello from NYC. I think this is a fantastic idea. Not only it’s a good use of money in the bank, but a dream home will also give special memories to your family.

    Similar to a commenter above, I lost my mother when I was 15, and this post really inspires me to do something special for my father. Another item to my life goal list! Thank you.

    1. Hi Jackson. Sorry to hear about your mother. May you and your had have plenty of good times left! Take some pictures and videos. Go on some trips until he no longer wants to do anything. Some parents slow down quite drastically after around 65.

  28. This is a really wonderful thought. Your parents are lucky to have you, and they must have done a good job for you to be so good to them. I’m glad you are considering a single level home. Aging in place is so much easier without navigating stairs which are the biggest source of fall injuries for elders who live at home.

    1. Thanks ZJ. The single story is nice, unless there is an elevator. My father mentions the stairs often. I shudder to think what would happen if an elder person fell down some stairs.

  29. DIY Money Guy

    Like you alluded in the article – the ultimate reason for saving and spending money should be in the pursuit of happiness. And like you said, you can’t take it with you. Sounds to me like you and your folks already have the dream/goal. Time to work towards the next steps in making it a reality. Wish you the best of luck. I’m sure you will figure it all out and make it happen well before 50. Thanks for the inspiration!

    1. I’ve thought of something sad:

      What if I reach 50 and achieve my goal of buying a dream property in Hawaii while my parents are no longer around to witness/experience/share?

      It’s really a race against time! How will you want to live your next 10 years…..?

      1. DIY Money Guy

        I couldn’t agree more about the race against time. My dad passed away from ALS when he was 59 and I was just 27. That was a major turning point in my life and when I came to the realization that time, not money, is the most valuable resource we have. I’m now 32, and to answer your question, I want to live my next ten years working a little, playing a lot, and resting just enough.

        Everything I do in the next ten years and probably for the rest of my life will be focused on putting smiles on the faces of my family and friends – my wife, my one year old twin daughters, my 90 year old grandpa, and my same group of buddies since fourth grade to name a few.

        By making smarter decisions with our money now, my wife and I look forward to having more options in the future to spend our time as wish, with those we care most about. My wife’s and I combined net worth should cross into seven figures by the end of the year so I think we are well on our was to FI/RE!

  30. Make sure when you are structuring the purchase you are aware there may be gift tax implications depending on who ultimately owns the property. Which could potentially result in reverse estate planning if they ultimately plan to pass the house down to you.

  31. I see the pro’s and con’s list at work again. Maybe a decision matrix would help :) It sounds like they would be happy staying where they are – but moving now would probably be much easier (physically and emotionally) than if they change their minds in a few years. And two stories will not get easier as they age. The potential income from their home is a great plus too. So many variables. I guess overall, it’s a good problem to have. I hope you find the perfect house so at least then you are just considering one decision too.

    1. Thanks. The easiest route is to do nothing. So this route is worth exploring. Going to visit two houses today for the 3rd time each. It’s good to see if perspectives change.

      1. Good luck with the visits! It will be so interesting to hear what you decide. We are in the stage of taking care of our parents too (age 77 & 86). The most honorable job in the world – and much easier now at FIRE.

  32. We’ve talked about this — not a dream home but just a home near us. It would work something like this:

    1. My parents would sell their approximately $125k house in small-town Iowa.

    2. They would move to our city in Colorado and buy a simple ranch house near us.

    3. This would cost them about $250k. They would put in half and we would put in half.

    4. They would live there the rest of their lives.

    5. We would inherit the property when they pass.

    Or, it could be:

    5. We own it outright and they simply live there (it might be useful if we own it versus them owning it)

    Any way, there’s still lots to figure out and they don’t want to leave Iowa yet. But it’s a situation we’re considering that’s similar to yours — with a couple less 00’s.

    1. Sounds like a great plan!

      Your price point is only ONE 0 less, not two :)

      I wish prices were as cheap in Hawaii than Colorado or Iowa. Alas, there is tons of mainland and foreign money that just buy everything up.

  33. PhysicianOnFIRE

    An interesting thought, and one of many reasons why I’m not content to stop working at exactly 25x expenses. The possibility of wanting a million dollar dream home at 50 is absolutely a consideration that factors in to my thinking.

    My wife and I spent a week in an Oahu North Shore dream home. 5 br / 5 ba on the beach. It was up for sale for somewhere around $4 million. I think I’d rather let someone else own the home, and stay in places like that occasionally.

    1. Yes. Bigger homes, more issues, especially homes right on the beach that get pounded by salt water and wind.

      You need A LOT more than just being able to afford a $4M home to be happy with a $4M home I have to imagine.

      The trend is towards condo living to keep things simple. I need to re-read my post on the joy of living w/ less.

  34. It’s hard to imagine anything more satisfying than being able to give back to your parents. As a relatively new parent myself, I have a newfound appreciation for everything my parents went through to raise us.

    If it will make them happy, and make you happy, and you have the money to afford it, why not?

    Money goes both ways – you work for it, so that you have enough to make it work for you.

    So make it work for you.

    Over a long enough time horizon, even at the high end, the market risk is negligible.

    1. True regarding market risk. We’re just not as young as we once were, and may not have enough time left in our lives to survive past market risks.

      That said, we would never sell this home once purchased. It would be a forever home.

  35. Sounds like you have a lot to think about! What’s great is you have a lot of fantastic options to choose from and are able and willing to relocate. Those pictures are amazing. A lot of people aren’t able to move so easily to be near their aging parents because of work or schools for their kids. You’ve thought about a lot of pros and cons. The timing of the real estate market is a big unknown though. It seems like the market for high end homes is softening and could continue to go down so if you decide to buy hopefully you can negotiate a solid price in case the market softens further.

    1. The homes are amazing. I put the $6.9M home in their for fun as I could never afford that right now. The grounds are just so beautiful!

      The opportunity right now is in the $2M+ range homes. Markets everywhere are so soft.

  36. Financial Canadian

    Hey Sam,

    Another great post, as always. I lost my mom when I was 17 so it’s always nice to see people taking care of their parents in their old age. Keep it up – I think you and I both agree we have a duty to take care of the people who’ve raised us!

    Question for you – Have you considered selling the old house and using the proceeds as more money down on the new mortgage? You seem like you’re on a spree of reducing mortgage debt lately!

    1. Sorry to hear about your mother. It’s so important to cherish who we have now.

      I’ve considered selling the old house, but it is not my full ownership to sell. The ownership is divided between multiple parties and when multiple parties are involved, things get complicated.

      It is kind of mind numbing to think about doing any type of transaction with multiple owners involved, because everybody has to agree to terms. Also, the property was purchased by my grandfather, and we want to cherish his memory.

  37. Kate @ TaxOptimizedInvestment

    Personally I’d prefer not to live in the same house with my parents, though I’d like them to live nearby. And I like renting more, for now.

    My parents are retiring soon and they are thinking about purchasing a house here in the Bay Area to so they can live here part time. Luckily, they don’t need any financial help from me. But I will help them manage the house when they are away.

    1. I wonder what percentage of adults would be willing to live in the same house w/ their parents at a later stage in life? I should have put a survey. Next time. I’m guess perhaps 45%.

      I’m thinking more regarding the duty of a son or daughter to care for their parents when they need more help. There are a lot of things we do, that we take for granted when we are younger e.g. cooking, cleaning, driving, walking, communicating, remembering, hearing.

      Our mental capacities eventually fade, in when they do, it would be nice to have a trusted person help out. I’m seeing memories and hearing slowly fade in my parents. I’ve got no doubt I will experience the same things.

      We must prepare.


      1. Kate @ TaxOptimizedInvestment

        Agree. My parents are still in their 50s. So they don’t need me to take care of them now.

        If your parents are elderly and need help, how about buying a two or three unit building together with them? This way you can each have your own space but you live next door and are close enough to help them out.

      2. I think the overall plan is brilliant and highly rational. Also great to think longer term for your parents. I have been trying to think similarly myself. Im sure it wouldnt be the most awesome thing to have your extended family around all the time, but in a big enough place it shouldnt be that bad, plus theyre your family. I certainly dont want anyone in a nursing home or such, unnecessary and sad. The in laws have a 3 level house and are in their 70s, any mention of the obvious even circuitously is met with disdain, even though its a huge burden and often a cause of forced selling (usually after a broken hip or such). This is a great way to pay back and forward for the family.

        My biggest problem with this kind of thinking is always the ginormous places while I tend to be pretty happy even in a small space (in a great place). Sure who wouldnt like a bunch of space, but its certainly more work, utilities, etc…especially nice grounds, that can get old or expensive…but gorgeous, conundrums.

        There are spec houses being built with these great little apartments right in them, in the 2500-3500 total sq ft range, very smart and efficient.

  38. It’s a tough call with forces pulling you in each direction, but most of your readers know how hard you’ve worked up to this point and I trust you’ll make the best decision. I must say having a dream home in Hawaii, while also being able to spend time with your parents, would be a pretty awesome setup in my opinion!

    1. Fiscally Free

      I agree.
      I would consider slightly cheaper houses that wouldn’t stretch the finances so much. Buying a house similar to your parents’ but newer and different might be just the ticket.

      I would also stay away from the mindset that a 50% better house will cost 50% more. I suspect you might actually be looking at it the opposite way–this house costs 50% more, therefore it must be 50% better. Make objective criteria of what would make a house 50% better, then see if that would actually cost 50% more.

  39. You’re lucky your parents live in Hawaii, what a great place to move to. My aging parents are divorced and live in the middle of nowhere and don’t want to relocate near me. Plus they can’t live together, so that complications things further for me. I don’t have any plans to move to their locations to take care of them in the future so I’m not sure what I’ll do when they aren’t able to take care of themselves. If they refuse to relocate near me then I’ll probably have to find a caretaker for each of them or help them move into an assisted living facility and try to visit more often.

    It’s going to be a lifestyle adjustment for sure to live under the same roof as your parents, but if you can afford to do it in an amazing property that sounds like the most ideal way. Most elderly people don’t want to live in a nursing home or an assisted living facility when they get older. So if you are able to care for your parents in your own comfortable home, I’m sure they would really appreciate that. The more space everyone has the better though for everyone’s freedom and breathing room.

    1. Hi Kate,

      It sounds like a difficult situation you are in to handle. Maybe have an open conversation with them to ask what they’d like to do?

      I’m very open to different options as I just want my parents to be happy. Ideally, we’d have a centrally located plot of land with two single level sized separate buildings to have our own space. But alas, such places are exorbitantly expensive in Hawaii.

      Keep the discussion going, and a solution may just appear! We all need to think about this kind of stuff.


      1. Hi Sam, I just started reading your blog so forgive me if I am not 100% caught up on your situation. You talked about living at various locations throughout the year, which is pretty much my dream. But do you have kids that have to go to school and thus ties you down for the school year? This is the major obstacle for me to convince my wife!

      2. You people !! Sheesh I love you all !! :)!!

        Its a secret I should not be revealing but Hawaii is the best place on planet earth.

        As I said, I love you all !!….but I hope we don’t go to a restaurant together !

        Ya’ll would be hemming and hawing about what to order forever !!:).
        Uhhh What about this.?: )…. what about that ?:)

        Get on a plane already and move to Hawaii ….Sheesh !

        …Mr Samurai, I dunno where you got your Samurai training but go back and get a refund !!:)

        Did nobody at your Samurai School ever teach you that time is worth more than money ??

        Your stuff is informative !!! but the way you constantly insert a high level of self important puffery into EvEryThinG !!….makes your stuff kinda seem like
        a personal shrine….just sayin :)

        My poking fun at you is not meant to make you angry its in good spirit.

        I never post on these things but this time and I’ll be on to other things so I won’t be spending time to post any replies. …..I just had to have a little fun with all of you .!)

        Aloha !

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