An impossible choice

Samson and Laura have given to others their whole lives—they even donate $10,000 a year to charity. Now their investments have gone bad and they have to make a heartbreaking decision: should they put the kids through university, or support the mother they love?


From the Dec/Jan 2010 issue of the magazine.


Family means everything to Samson and Laura Vaez. And four years ago, it looked like they had it all. They were happily married, owned a lovely home in Winnipeg, and they had three wonderful school-age boys—Sam, Aaron and Jacob. Grandma lived nearby too. Both Samson and Laura had solid jobs: he worked as a dispatcher and manager at a small taxi company, and she worked part-time teaching night school. They were wise with their money, and over the years, the couple managed to save more than $200,000 in their RRSPs. They even paid off most of the mortgage on their $450,000 home. They felt secure and happy, and they had plenty left over to help those less fortunate then themselves, so every year they donated about $10,000 to several church-related charities.

But over the last three years, everything has changed. Samson, now 49, and Laura, 47, are finding their generous nature is tearing their comfortable life apart. In 2006, after attending some financial workshops, they made what they now realize was a terrible financial mistake, agreeing to put their life savings—more than $200,000—into four limited partnerships that invest in commercial and residential property. All of the partnerships ran into trouble and are now frozen. One is in bankruptcy, and another is being investigated for fraud by the provincial securities commission. “These investments may be worthless,” says Samson. “I knew they would be fairly illiquid—but we never imagined that we wouldn’t be able to sell them at all. How do you plan for that?”

Then, when they were at their most financially vulnerable, the Vaezes (whose names and other details we’ve changed to protect their privacy) were suddenly faced with a terrible decision. Like many other members of the sandwich generation, they were being squeezed hard by the simultaneous demands of looking after both their parents and their kids.

In addition to the regular costs of paying the mortgage and buying the groceries, the Vaezes have to take special care of their oldest son, Jacob, 16, who has suffered from an immune disease most of his life. Lately the cost of his weekly therapy treatments had been getting higher and higher. On top of that, the couple is supporting Samson’s 74-year-old mother, Jan, who lives nearby on just $9,000 a year in Canada Pension Plan and Old Age Security payments. The Vaezes pitch in with $3,000 a year to help her make ends meet, and that money also indirectly helps Samson’s older brother Michael, 51, who lives with his mother in the old family home and helps to take care of her.

“We want to keep her in her own home as long as possible,” says Samson. “My brother works for a cleaning company and doesn’t make much money. My other two brothers are either in bankruptcy or in debt up to their eyeballs so they can’t help. We feel we have to do what’s right.”

Providing support for so many family members, plus donating $10,000 a year to charity, was already stretching them thin, but the final straw came earlier this year, when Samson’s mother slipped and fell on the stairs. She sustained serious hip and knee injuries that made it impossible for her to get to the second floor of her home, so Samson and Laura had to suddenly spend more than $6,000 to put a new bathroom on the ground floor. “Wherever we turn there’s another expense facing us,” says Laura. “And these are expenses that will be with us a long time.”

Now Samson and Laura face a heartbreaking decision. They love their three kids dearly and want to set them up for a long, successful and happy life. That means getting them the best education they can afford, and Laura is worried that the $22,000 they have saved up in their RESPs won’t be nearly enough. Jacob, their eldest, is already in a special co-op program training to become a hair stylist. Sam, who’s 12, has his heart set on studying medicine, and Aaron, 14, wants to study aeronautical engineering. Such degrees require special programs, and will mean supporting the boys at out-of-town universities. Laura figures the total cost for schooling all three kids could be as high as $150,000.

How the money is spent

Yearly disposable income
Samson’s income $85,000
Laura’s income $18,000
Minus: taxes and other deductions –$30,000
Net disposable income
Yearly Expenses
Debt repayment:
Segregated fund loan
Line of credit (interest only) $6,000
Total debt repayment
Mortgage on home $7,200
Property taxes $2,400
Home insurance $1,596
Hydro/gas/water $5,232
Cell phone/internet/TV $3,360
Home maintenance $1,000
Total shelter
Car insurance $960
Gas $960
Maintenance $1,000
Total transportation
Groceries $12,000
Clothes, haircuts, etc. $1,000
Furniture $500
Vacation $5,000
Sports activity fees $1,500
Electronics $500
Charity $10,000
Gifts $1,500
Restaurants $1,000
Gardening supplies $500
Life insurance $480
Jacob’s therapy $3,420
Support for grandma Jan $3,000
Miscellaneous $3,000
Total personal
Total expenses

Annual income available for investment
(total income minus total expenses)


The Vaezes might possibly be able to pull that off, but if they decide to pour all of their resources into helping their kids, they won’t have a penny left to support Samson’s mother. Her fall made it clear that eventually she’ll have to go into a nursing home, and they’ve heard the cost can be considerable. “Right now, we’re paying $3,000 a year to keep mom in the home she co-owns with my brother-in-law Michael,” says Laura. “But that amount could skyrocket. And because she owns her home with my brother, we can’t just sell it. My brother wouldn’t be able to afford another home on his own. His lifestyle would really suffer.”

They can’t do it all, and they know it. “We’re frustrated because we are sandwiched between two generations—our kids and our parents,” says Samson. “Both need our help but there’s only a limited amount of money to go around.”

Samson knows very well what it’s like to live in a household where there’s never enough money to go around. His dad left home when he was just 13 years old, and his mom raised him and his three siblings on her own. Her only income came from welfare and a little extra money she earned for being a foster parent. “She got the house in the divorce but never got any child support from dad,” says Samson. “She never complained though, and we made ends meet.”

Samson met Laura when he was 23 and working as a taxi driver. She was 21 and studying accounting at a local Winnipeg college. (Laura had already been married once before, very briefly, and divorced at age 20.) She fell in love with Samson the day she met him. “He was so generous and giving,” she recalls. “We hit if off right away.”

Their early years were joyful, exciting years, but they had their share of misfortune too. At age 29, Samson had a nasty car accident. A pick-up truck rammed him from behind, and his car was totalled. It left him unable to drive for long periods of time, so the cab company he was working for moved him to a desk job at head office—a job he still holds today.

The couple lived together for 10 years, then married when Laura was 30, in 1993. They immediately had three sons in a row. “During those early years, we saved quite a bit of money in RRSPs,” says Laura, who had worked full-time at an accounting job until her kids were born. “But once the kids came along, I stayed home to care for them and later, home-school them, working part-time only in the past four years to bring in some extra money.”

Samson and Laura bought their current home in 1995 and diligently paid down the mortgage—just $50,000 is still owing today. They found money for RRSPs too, and built up their $200,000 in savings quickly. They invested their money aggressively because Samson had a great pension at work that they could fall back on if they needed to. “He’ll receive 70% of his net pay if he works right up until he’s 62,” says Laura, “so we never hesitated to take some risks with our RRSP money.”

For a while things were good, and the worries were few. Until four years ago, that is, when they made that disastrous decision to invest in the limited partnership agreements. The worst part is they didn’t just invest the $200,000 they already had, they also borrowed $125,000 on their line of credit, putting a total of $325,000 into four partnerships. They also took out a $50,000 loan that they invested in a segregated fund that won’t pay out for 10 years. (The other $50,000 on their line of credit has gone towards personal expenses.) Apart from the RRSP money invested in limited partnerships, Samson also has $7,000 invested in a couple of dividend-paying stocks that he wants to hold on to.

The biggest worry the Vaezes have now is their growing debt level. The total amount owing on the line of credit and the segregated funds loan is a massive $225,000—not including the $50,000 owing on the mortgage—and the amount they’re in the hole for isn’t shrinking each year, it’s growing. “It’s scary,” says Samson. “We have no excess cash at all. We’re living on the edge.”

The Vaezes say all of their dreams are now on the line. At one time they thought they’d be able to retire when Samson reached 55 and maybe spend part of each year in Arizona. But now it doesn’t look like Samson will even be able to retire when he’s 62—the year he’d be eligible to collect his company pension. “I know it won’t be easy because the next decade is going to be very expensive for us,” says Samson. “We just hope we don’t have to sacrifice our own retirement to do what’s right for our family.”

Where they stand

Home $450,000
Samson’s bank RRSP $7,000
Samson’s RRSPs
(limited partnerships)
RESP $22,000
Vehicle (2002 Honda) $4,000
Total assets $683,000
Mortgage on home (2.75%) $50,000
Line of credit $175,000
Loan to buy segregated fund $5,000
Total liabilities $275,000
Net Worth
(total assets minus total liabilities)


What the experts say
Samson and Laura Vaez have strong family values. But they have given and given for most of their adult lives without caring enough for their own future. “The Vaezes really have to do a lot of soul-searching,” says Barbara Garbens, a fee-for-service planner in Toronto. “They have to ask themselves some hard questions—what is it that they want to sacrifice to continue doing what they’re doing? I’m afraid that if they continue along this path, at 60 they will end up sick and with very little money.”

Al Feth, a fee-for-service planner in Waterloo, Ont., agrees. “It’s quite a bad case,” says Feth. “These are salt-of-the-earth people. They need to step back and make a list of priorities. They can’t afford not to.”

First, the Vaezes need to plan their finances as though their life savings are gone. “In a bankruptcy, unsecured creditors usually get next to nothing,” says Garbens. “And in the case of securities fraud, there may be some money but it could take years to get any of it back.” The next 10 years will be critical. Here’s what the experts say they should do.

RESPs or charity?
Sometimes you need to make a decision that’s more about values than dollars and cents. That’s the case for the Vaezes’ hand-wringing decision between paying for their kids’ post-secondary education, and giving to charity.

Our experts say the couple has two choices. The first is to drastically reduce the amount they give to charity. Garbens, for one, would like to see them reduce the amount they give from 10% of their income to 3%, or $3,000. “Giving more is jeopardizing their family’s future,” says Garbens. “Do they want the kids to have a good start in life or not? If they do, then that money has to come from somewhere.”

However, Feth disagrees. He says that if they feel strongly about their annual $10,000 donation to charity, then they should let the kids pay for their own post-secondary education. “An education is a good investment,” says Feth. “But part-time student jobs, scholarships and loans can help the kids pay for university. It will work out fine.”

Refinance their mortgage
The Vaezes should roll the $175,000 from their line of credit (that doesn’t include the $50,000 segregated fund loan) onto their mortgage and refinance. That will boost the amount owing on their mortgage from $50,000 to $225,000, at about 4%. By doing this, their monthly mortgage payment (on a 20-year amortization schedule) will go up to $1,363 a month. That’s a bit higher than what they’re paying now, but by age 65, they will only have a modest $60,000 left on the principal.

Apply for GIS
If Samson’s mother is 73 and she’s only getting $9,000 a year, then she hasn’t applied for the guaranteed income supplement (GIS). The Vaezes should do so right away. It would add $544 a month to her income. “That would give Jan an extra $6,000 a year, alleviating much of her financial burden,” says Feth. “The $3,000 a year that the Vaezes save by not having to pay Mom should go towards their debt.”

Sell grandma’s house
If Samson’s mother needs to go into a public nursing home or retirement facility, they should sell her house and use the 50% equity she has in the house to pay for it. “It’s not the Vaezes’ job to subsidize Samson’s brother’s living arrangement,” says Feth. While the government ensures you can always get nursing home care if you need it at a reasonable price, if you want private care or even a private room in a public home, it’ll cost Jan from $2,000 to $7,000 a month, depending on the facility.

Laura should get a full-time job
In two or three years, when their eldest son Jacob is more independent, Laura should go back to work full time. Laura’s earnings should go towards paying down their debt quicker so that they can retire earlier—maybe when Samson is 62. “Laura will get a healthy RRSP tax deduction and the extra retirement savings, coupled with Samson’s company pension, will go a long way towards giving them the comfortable retirement they crave.”

107 comments on “An impossible choice

  1. 1)Who was the Adviser on the RSP investment, did it fallow KYC…get a Lawyer on that asap. 2) Sell both homes and buy a large bunglow for ever one to live in, do not put your Mother in a nursing home….you have strong family values. Every one pulls their weight ….if your brother doesn't , he must leave….even the kids must get a paper route or something.


    • In Winnipeg, a $450,00 home is a very fancy home. A 3 bedroom ranch in a decent middle class area can be had for $250,000 – this would free up some significant $$$

      And yes – why do parents think they have to foot the WHOLE bill for University. 20 years ago, no one but the wealthy usually did this – if you can pony up 50% of costs, that si still pretty darn good!


  2. Pingback: Tweets that mention An impossible choice | MoneySense --

  3. They could consider selling their home and moving just outside of Winnipeg, as we did. We live 45 minutes away, have beautiful clean air, less crime and we paid $107000 for a very nice house. In Winnipeg, this house would be worth $250000.

    They should not have put all of their eggs into one basket. Real estate is not always a simple matter.

    Around the world, it is quite common for elderly parents to move in with their children. The elderly parents help with the raising of the grandchildren. This saves money for all, including the parents who no longer need childcare.

    As for the brothers and their financial mess – let them learn how to fend for themselves. They will survive.


  4. I agree with the selling of the house. When you're in crisis–which they are!–$7,200/year is going to make a world of difference! Downsize (I once went from a three bedroom house to a one-bedroom basement suite, so yes, I understand that's hard…but frankly I don't think it's as hard as facing the kind of financial crisis they're facing now), pay CASH for the next home, and if there's anything left over (with that much equity built up there may very well be something left over), put it towards that priority list!


  5. Plenty of students take out student loans and work full-time during the summers and part-time during the school year. I am one of those people and I am better off for it. Your kids need to get to work. Don't coddle them — That's not doing them any favours. That doesn't teach them how to be responsible or independent. You know the saying: "Give your kid a fish, feed him for a day, teach your kid to fish, feed him for life." The majority of the people I know whose parents paid for their university d**ked off anyway… drank, did drugs, skipped class, etc. They didn't care if they failed a class because they knew their parents would pay for them to retake it. When the student is responsible for paying tuition on their own, they never fail a class.


  6. Not that it matters much, but I don't think the numbers shown in the tables are correct. The article, in several spots, refers to the $50,000 segregated loan but the net worth chart seems to list it as being only $5,000.

    Also, the $200,000 in the limited partnership (really $325,000) is the cost of the investment. In a net worth statement, the actual value should be given. I doubt that the cost is the value given that one or more of the LPs is in bankruptcy.


  7. Pingback:

  8. I found your website yesterday and I have been reading it often. You have a generous amount of brilliant informative stuff on the site and I like the fastidious type of the website too. Keep up the fantastic work!


  9. I agree with your thoughts here and I really love your blog! I’ve bookmarked it so that I can come back & read more in the future.


  10. If you have a back problem you should consult with your health professional before you do any exercise. If your Doctor / Physiotherapist says it’s OK then go yet to be. Please don’t buy this until you’ve been tartan out first. Lets be safe


  11. Great job here. I actually love what you had to mention. Keep going as a result of you definitely bring a replacement voice to this subject. Not many of us would say what youve said and still create it interesting. Well, at least Im interested. Cant wait to ascertain a lot of of this from you.


  12. I cling on to listening in the direction of rumor speak about obtaining boundless internet dependent grant programs so i’ve been looking for near to for the best internet site to obtain one. Could you reveal to me please, especially where could i arrive around some?


  13. I cling on to listening in the direction of rumor speak about obtaining boundless internet dependent grant programs so i’ve been looking for near to for the best internet site to obtain one. Could you reveal to me please, especially where could i arrive around some?


  14. I very much doubt that I will go back to normal decks now I have this. Virtual dj has saved me alot of money in the long run


  15. Hi there, just became alert to your blog through Google, and found that it is truly informative. I’m gonna watch out for brussels. I’ll appreciate if you continue this in future. Many people will be benefited from your writing. Cheers!


  16. We just couldnt leave your website before saying that we really enjoyed the useful information you offer to your visitors… Will be back soon to check up on new stuff you post!


  17. Appreciating the hard work you put into your blog and detailed information you provide. It’s nice to come across a blog every once in a while that isn’t the same unwanted rehashed information. Great read! I’ve bookmarked your site and I’m including your RSS feeds to my Google account.


  18. Need help please! Has any man or lady acquired any functioning experience while using conditioning computer software from 10BuckFitness? My new private coach swears by these wokouts and he and his son have similarly long gone from simply fire hydrants to tri-atheletes from the last twelve june thru september or so. I’,m in lookup of the very good lifting computer software for bodybuildingFor only 10 bucks- i am considering, but would be thankful for any encounters instead much. Thanks!


  19. Well this could likely be considered a very good article, instead beneficial an I be conscious that it is in real truth instead crucial particularly for people teenagers who’ve dermis problems.


  20. Nice commentary. last thirty days I uncovered this internet internet site and desired to permit you be conscious that i’ve been gratified, heading via your site’s posts. I should certainly be signing equally as much as the RSS feed and can wait around for another post. Cheers, Glen


  21. I’ve bookmarked, Dugg, and I joined the RSS subscription. Thanks! .


  22. Hi, adore your site..please do research out my internet site at conditions and escape from your comment. thanks


  23. Need help please! Has any man or lady acquired any functioning experience while using conditioning computer software from 10BuckFitness? My new private coach swears by these wokouts and he and his son have similarly long gone from simply fire hydrants to tri-atheletes from the last twelve june thru september or so. I’,m in lookup of the very good lifting computer software for bodybuildingFor only 10 bucks- i am considering, but would be thankful for any encounters instead much. Thanks!


  24. Nice article. last thirty days I uncovered this internet internet site and desired to permit you be conscious that i’ve been gratified, heading via your site’s posts. I should certainly be signing equally as much as the RSS feed and should certainly wait around for another post. best Regards, Mateus


  25. Definitely cool desgin of one’s website. It can be individual and compares to your posts. Don?t give up and make your personal point!


  26. I have had a herniated disc ( L5-S1) which I have lived with fairly well since 2005. At the present I have low back pain and severe weakness in my left leg. I cannot squat down and if I do I cannot get up as left leg is so weak. Had an MRI in 2005. Could this all be caused by the back injury – I know you are not Doctors but your thoughts mean a lot to me?


  27. the wieght loss industry has done the? same thing for years, they try to prey on your insecurities, just be happy with yourself because in the end you gain nothing and lwill ose money


  28. I have been exploring for a little bit for any high-quality articles or blog posts on this kind of area . Exploring in Yahoo I at last stumbled upon this site. Reading this info So i am happy to convey that I’ve a very good uncanny feeling I discovered just what I needed. I most certainly will make sure to do not forget this website and give it a look regularly. Find Writers on oDesk


  29. I found your weblog web site on google and check a few of your early posts. Proceed to keep up the very good operate. I simply additional up your RSS feed to my MSN Information Reader. Searching for forward to studying extra from you afterward!…


  30. you’ve gotten an ideal blog right here! would you prefer to make some invite posts on my blog?. haha the one who is posting the comments A shapely A lot more A lot more.


  31. I think this is one of the most important information for me. And i’m glad reading your article. But want to remark on some general things, The web site style is perfect, the articles is really great : D. Good job, cheers


  32. That seems good however i am just still less than sure that I prefer it. Anyway will look far more into it and decide for myself! :)


  33. I comprised simply essaying this original articles for a while . Right after all the time much like uninterrupted Googleing, in the end I got it in your site . I inquire whats precisely the dearth of Google regime the exact dont rank this particular rather informative blogs in peak of the lean . Often the top quality articles or content are full for instance refuse .


  34. What a lovely day for a 4428352! SCK was here


  35. Ok, that’s a nice beginning but i’ll have to explore that a tiny bit more. Will let you know what else there is.


  36. Hi and many thanks for the comment you still left on my blog, i’ve also bookmarked your internet site and can return as i uncovered the data within your internet page just like a very good source to my very own pup regards Eddie


  37. I cling on to listening in the direction of rumor speak about obtaining boundless internet dependent grant programs so i’ve been looking for near to for the best internet site to obtain one. Could you reveal to me please, especially where could i arrive around some?


  38. That sounds good however i’m still not too sure that I like it. Regardless will look even more into it and decide for myself! :)


  39. Firstly, I enjoy your post deeply that I’ve really link this page to my casual site. Find your backlink here: But on to my real comment: Would you thoughts if I quote a few of your posts as long as I supply credit and sources back again to your blog? Since the data right here fascinates me and my web site is in the exact very same niche as yours and my users would genuinely advantage from a great deal of the info you give right here. Make sure you let me determine if this is acceptable to you. Thanks!


  40. Well, it is excellent, but think about additional options we’ve got here? Would you mind crafting one more article about these too? Appreciate it!


  41. Hi blogger, commenters and everybody else !!! The site is totally wonderful! Lots of superb information and facts and creativity, each of which everyone need! Keep them coming… you all accomplish such an admirable job at such Aspects… cannot explain to you just how very much I, for one truly appreciate all you do!


  42. I have learned some new things through your blog post. One other thing I have recognized is that usually, FSBO sellers may reject you actually. Remember, they’d prefer not to ever use your services. But if a person maintain a gradual, professional relationship, offering assistance and remaining in contact for around four to five weeks, you will usually have the capacity to win a meeting. From there, a listing follows. Cheers


  43. I’m still learning from you, since I’m bettering myself personally. I certainly enjoy reading all which is published on your web-site.Keep the advice coming. I real love it


  44. Pingback: Check out my facebook profile

  45. Pingback: Black Hat

  46. Pingback: Fathers Day Gift

  47. Pingback: microwave ovens news

  48. Pingback: bathroom scales

  49. Pingback: treatment for fibroids

  50. Pingback: Drug Detox

  51. Pingback: The Microwave Ovens

  52. Pingback: Syrup for Snow Cones

  53. Pingback: Wedding Gift Suggestions

  54. Pingback: Vacuum cleaners info

  55. Pingback: Thewaterkettle

  56. Pingback: Electronic Cigarette Reviews

  57. Pingback: Acne Skin Care Product

  58. Pingback: Tools For Sale

  59. Pingback: Gold Buying Business

  60. Pingback: Air Conditioner Filters

  61. Pingback: tracking pay per click

  62. Pingback: Acai Berry Scam

  63. Pingback: Bungalow Ile Maurice

  64. Pingback: Herbal Incense

  65. Pingback: Location Ile Maurice

  66. Pingback: Mauritius Holiday Villas

  67. Pingback: ways to make money online

  68. Pingback: Online Paralegal Courses

  69. Pingback: stretch mark creams

  70. Pingback: Wooden Dog House

  71. Pingback: direct loan consolidation

  72. Pingback: dallas roofing

  73. Pingback: Associate Degrees Online

  74. Pingback: roofing companies in kansas city

  75. Pingback: tree service houston

  76. Pingback: houston roofing

  77. Pingback: Location Vacances Ile Maurice

  78. Pingback: Best Online Dating Sites

  79. Pingback: Whole Life Insurance Rates

  80. Pingback: Mauritius Accommodation

  81. Pingback: atlanta employee benefit

  82. Pingback: Video Game Store

  83. Pingback: Cyber Monday

  84. Pingback: Stair Lift Prices

  85. Pingback: property casualty insurers

  86. Pingback: replacement windows dallas

  87. Pingback: Personal Secured Loans

  88. Pingback: Credit Card Consolidation Loans

  89. Pingback: Great Acne Cure ebook

  90. Pingback: Article Marketing

  91. Pingback:

  92. Pingback: stop sexless marriage

  93. Pingback: keurig B60

  94. Pingback: וילונות

  95. Pingback: Schwinn stationary bike

  96. Pingback: Marriage help

  97. Pingback: Best Diet Plan

  98. Pingback: Site for relationship problems

  99. Pingback: Camsex

Leave a comment

Your email address will not be published. Required fields are marked *