Bank of mum and dad

My parents always helped me out when I was younger so I've always had the same attitude with my son and daughter in law. Yesterday I lent them over 10k towards a car they are buying, but I will get that back as soon as their approved bank loan comes through. I would happily have let them pay me back on a monthly basis but couldn't as OH and I have to survive on his state pension so it's our 'rainy day' money and who knows when we might need to dip into it!

We have bailed my daughter out on numerous occasions through her sheer overspending. Her husband won't put his foot down so she carries on buying stuff she can't afford. She has borrowed off our son also which we have only just been made aware of. My DH and I have told her enough is enough and the bank is closed. We have realised that we have probably nurtured her spendthrift ways but she can't go on expecting others to pay for her foolishness. Our DS no longer speaks to her as he was called all kinds of names when he asked for some sort of payment after she avoided him for almost 12 months. He was upset because he could little afford the loan and was promised quick payback when he was asked. I don't blame anyone for lending/giving their children a helping hand money wise, as times are hard for the young ones but our DD has a good job as does her hubby, her debts are because of her stupidity and carefree attitude to money.

Sadly, just as some of us are tone deaf or have two left thumbs when it comes to sewing, some people simply can't master budgeting. It makes life very difficult for them in these days of abstract figures in banks and credit, unlike the days when you could actually see how many coins and notes were left in your purse, and tended to get paid weekly.

Don’t be to quick to judge. I know we had to borrow from my FIL when we ran into money problems when my husband returned to college as an adult. We also set up standing order and paid it all back. We were so grateful and it did play into how we respected them in later life. My MIL was a serious pain but I never forgot how she paid for my DH to come home at weekend.

wanderers1 It sounds as though you have a really good relationship with your DCs something to be proud of good on them for opening up to you and your hubby about their problem some would try to hide the fact and struggle on.
We topped up our DS1s mortgage deposit for them as they would never have managed it themselves same for DS2 when the time came as they would never have got on the buying ladder if we didn't it is just less money when we eventually divide our estate between them and their sister.

We have helped out DS out a few times and I believe his credit card is creeping up again. The problem is it's just too easy to borrow. Unbeknown to me he had a credit card whilst still at a local college and only having a saturday job - it's just too easy. For the record, he has always paid us back by setting up a direct debit but we have let him off some of it.
Well done Wanderers1, family is everything and we too will always help our grown up children in whatever way we can.

A few years ago DH & I offered to help out DD & her OH by way of a loan with a small amount of interest added (only about 2%) £5000 over 5 years paid by Direct Debit.

Loan was repaid with no problems but we had the money & they had debts to clear. The debts had been accrued whilst they were struggling on benefits after DGS1 was born, no fancy spending for them. Happily although they are still on benefits & have DGS2 their financial situation is much better. Sadly this is because DD's OH is on full disability benefits. DD is stay at home mum & carer for her OH.

This is the first time they have got into difficulty that they have told us. In the past we have helped DD after her B*****d of a husband left her in debt
(thank God he's gone). She paid us back within 3 years. So proud of her.
Have no doubt our DS will pay back over 3 years.
We have always treated our money as theirs as well, would rather they had the benefit before we are dead. Long time of as we are very early 60's.

I agree with inishowen, "family is everything".
Wanderers1, I know that it's upsetting when you find out that your Ds and Dil have not handled their money well.
At least they admit this, by telling you they've been "daft" .
They seem to be very open with you as you have all gone through a plan, with their income and outgoings together and they can pay you back and their other debts as well.
You said that the debt had scared them, it sounds as if they could have lost their home maybe. So hopefully now you and Dad have got them on the right path all will be fine.

My sister and I have both had to go to the bank of Mum over the years (I wouldn't want to owe Dad) but now that she is older she is refusing to accept money from me which makes me cross but there is no point in getting cross with her now that she is in her 90s. If you can afford it without it affecting your ability to cope as you can get older, as they seem chastened by what has happened, I looks like it should be ok - but hopefully they will be able to return the favour at some stage and you will accept it. (Sorry, that's slightly off at a tangent but a bit of a raw nerve.)

I have been the bank of Mum for years. My son lives on another planet and I always have to bail him out! The cost so far has been £30,000 (my premium bonds!!). I dread new Years Eve, as it is always the month of January when he has the problem. He is not conning me, he is just really stupid with money!! no matter how many times I have shown him how to budget! But I love him so dearly, and shrouds don't have pockets!

Oh dear a loan advert has popped up!

Yes, I think we all help out at times,my Son is a single parent and has two teenage boys, he copes well but occasionally he has difficulty with bills, when there has been a pay out for the boys winter clothes, shoes etc. I have said "ask when you need to" which he does, it is never a huge amount and I must admit he always pays back as soon as he can which is usually the month after he has borrowed, it is odd really but I do get satisfaction when I can help him, it is nice to be able to do so, and I KNOW I always get it back, sometimes with interest! Sometimes I say when its time to pay back that he doesnt need to, but not every time obviously.

We are off to spend lots of money on refurbishing our daughters house. Looking at kitchens this morning.
We own the house, she and her husband pay rent at a much reduced rate. They only have one child, can’t afford another.
They both work hard but are only on min. wage so not a lot of cash. So we re helping them.
Hats off to you wanderer1, don’t suppose you had much choice but you all seem to have handled it in a sensible way. As long as they have realised things have to be paid for in the end they should be fine.

Is there some way you can secure this loan by way of second charge on their property, just in case they default, because a secured loan would be repaid aead of other creditors and they do seem to have been lax in their spending.

I have been let down more than once when lending money tot he children only to find drastic changes in their circumstances leave me out of pocket.

We all do it because we love them but things can change for them.

Wanderers, I think what you're doing is super if you can afford it. Yes your children have been foolish with money but they're far from being on their own and if you can help good on you. I've helped my DD & DIL and don't want the money back, I'd far sooner they have anything now that can help them rather than when I'm gone , I've suggested the money they'd be paying me back goes into savings so if I do need it in the future then I'll get it, but if not then they'll have a nice little nest egg later. Win win as far as I'm concerned .

After quite a few occasions of helping my adult son with his overspending, and attempting to instill some financial planning into him, he continued to get himself in a mess. This was not as a result of any misfortune, just overspending on a large scale. On the last occasion, some 3 years ago, I’m afraid I said no, you will have to sort it out yourself. He did get some debt advice and after 3 rather fraught years, he is now debt free, and managing his money better. He still lives from one payday to the next, but at least he isn’t in debt. I think he needed to learn that you can’t just have everything you want, the minute you want it. I felt awful saying no, and he did have a rather dreary time, with not much of a social life, but it was worth it.

I hope that your generosity is rewarded and they get their lives back on track.

Bankruptcy or a Debt Relief Order or some other strategy may well be a better idea, especially if "this total is with a discount for early payment and this is only part of their debts". Having worked with people who get into debt, I know it is often a pattern that continues or repeats itself over time, due to misfortune, poor budgeting skills or just plain stupidity. So maybe they should have talked to the CAB or National Debt Line to explore alternatives first to see if they could get some of it written off somehow or achieve a sustainable repayment plan on their own and to avoid the risk of you possibly throwing good money after bad?

We have just given large sums to our son and daughter. They can now pay off their mortgages. In our son's case he will be £700 a month better off. Our reasoning was that there is no point in them getting this money when we die. We hope not to die for another 20 - 30 years! This way we get to see the grandchildren benefit from the money. We don't need to be paid back as we have enough for ourselves, but if we did, we'd be happy to accept a monthly payment. Family is everything.

I think you have done the right thing Wamderer. Much better to borrow from you than elsewhere. It also says a lot about their relationship with you that they could ask for a loan and arrange to steadily repay it. This is what family are for.

I'm sure everyone is correct in saying other mum and dad's are helping their children. Yes it's best to come to us than go loan sharks, payday loans etc.
No they won't pay interest. We are happy to help them as I said it's all about the family.
I think this has scared them and they hopefully not get in debt again.

Your children must be very relieved you are helping them
Wanders we don't like to see our children in difficulties.. I think you should make it clear that this is a one off and they must learn from this experience. Good luck.

I'd feel fortunate to be able to help out in this way. It's better they come to parents than loan sharks and the fact they did so makes me hopeful they'll learn from this experience. The bank of mum and dad is alive and well everywhere that mum and dad have any savings.

It makes sense as I presume they will not pay you interest. Their debts are cleared, they only have to pay you and hopefully they will do so and start afresh after the 38 months.

tiredoldwoman, I think you are being unfair. the OP and her children have taken the whole issue very seriously and the repayment has been set up based on what they can afford.

We get so many stories on GN of parents who have given their children everything, paid debts, bought cars, etc, etc and post in distress because their children are demanding more money and threatening to stop them seeing grandchildren if they do not help.

Here we see wise parents and a good family dynamic. Both of my DC got into financial muddles in their university/early working years, they always came to us and we helped them sort their problems and we lent them money that they repaid on a regular basis and did not let us down. They are now in their mid 40s and are sensible and careful with money. I see no reason to think this will not happen in Wanderers1's case.

Wanderers1 is not alone in the situation she has found herself in, nor in her solution. If she knew, she would probably be surprised by how many of her friends and relatives are doing just the same thing as she is.