Question: Our oldest has substantial long term debt and just lost her job. She is living with us temporarily, but we live on a fixed income and money is tight. What should we do?
Answer: It’s time for all of you to sit down and discuss these issues, thoughtfully and supportively. Your adult child needs to identify and plan of action and you need to share your own money concerns and the added stress this brings to your household.
In tough times, everyone needs step up and be an “adult” in the room. It’s only fair to everyone involved. You cannot afford to be afraid or ashamed to let your child know that you have only so much income to live on.
"All adverse and depressing influences can be overcome,
not by fighting, by by rising above them.”
- Charles C. Colton |
Your financial life should not be negatively impacted by an adult child.
Even though she has long term debt and no job, she should have an immediate plan for addressing her unemployment and she should be in direct talks with her creditors, making every effort to work out special terms until she is back on her feet.
Explain that she must seek out a job as soon as possible in order to help both repay her long term debt as well as support herself while she lives with you. At the very least, she should in some way contribute in order to avoid causing you additional financial hardship.
If you simply allow her to eat and sleep at your home without setting any expectations or rules, then you cannot be sure the situation won’t remain the same for a long time to come.
Plus, you are doing her no favors by enabling her bad behavior. As an adult, she must realize that you are under no obligation to support her financially It is time for her to take control of her life and her finances in order to get back on track and on her own two feet again.
Likewise, if she requests that you help her repay her long term debt, as much as you may want to say yes, firmly and supportively tell her No.
It has been her own choices that have led her into this situation and she needs to learn from her mistakes and take ownership of the consequences. This is how she will learn and grow into a wiser and more productive person.
She cannot expect you to save her every time when something goes wrong. You are already helping her by providing her with a place to stay and food to eat. She is an adult now; she must learn to take responsibility for her actions and for her future.
Together you might consider seeking out credit counseling to help all parties formulate a short and long term budget. Let her know what you need her to help with and support her on her job searches.
Gaining new employment must be job #1. She has to get money flowing in again, even if that means working for less initially. If there is no income, there will be no way for her to pay off her long term debt or help with household expenses.
Make sure she is not spending money on frivolous items – even a fancy cappuccino each day can quickly add up. Now is not the time for her to be indulgent. Now is the time for her to face the adversity head on and in the process she will strengthen her character.
Every penny should go toward ridding herself of debt and getting herself out of your home and back into the world, supporting her self and getting on with her life.
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"Fresh activity is the only means of overcoming adversity.”
- Johann Wolfgang Von Goethe |
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Debt is NOT your friend. It's not a wonderful "tool" for building wealth. That's a myth.
