When you Find Yourself Paying for Your Parents’ Financial Mistakes

Jen SmithPersonal Finance16 Comments

Parents Financial Mistakes

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Politics. Religion. Money.


These are things you don’t talk about at the dinner table. But if you were like my family we didn’t talk about them at all, maybe religion on Sundays and politics every four years, but money? Never — children should not be burdened by the family finances.

Fast forward to present day, I’m 27, married, and just bought a house. My mom dropped the bomb on me last week that she’s being foreclosed on in less than three months. She also shares that the process has been going on for nine years but got serious eight months ago.

I was in complete shock.

To put it into perspective, I’ve spent the last 5 years trying to help my mom with her finances. I knew they’d gone downhill since my dad’s death in 2006 but had never got a straight answer. I bought her easy reads on retirement and increasing income, I sat with her through Financial Peace University (while this situation was escalating) and suggested she sell my childhood home for something more affordable.

I asked her questions and the answers never fully added up. She offered to give us her washer and dryer for free saying she’d rather use the Laundromat. She asked to take the boxes from our recent move for a random friend. I even saw her house on Zillow while we were looking to buy and it read “in foreclosure.” She said the website was incorrect.

When she did finally bring me up to speed on what’s going on, a scenario that could’ve just been an inconvenience if we’d worked together on it years ago is now a mess that I have to clean up. Because of this culture of “we don’t talk about money” She lied to me and made things so much worse.

total savings by age based on a survey by gobankingrates.

Millennials are at a point where in order to take care of ourselves we have to start thinking about taking care of our parents, whether they deserve it or not. It doesn’t mean I’m letting my mom move in with us or paying her future rent, but I’m establishing habits now so you I’m protected in the future.

Start Talking

To hell with the idea that “polite adults don’t talk about money.” I think we should talk about money everywhere but if you can’t at least talk about it at home where are you supposed to talk about it? In fact, you’ll probably need to hire a therapist if you don’t so save the money by starting open and honest conversations now.

mothers financial mistakes

Sure there are ways to look like a jerk talking about money but there are also constructive and lighthearted ways to do it. I believe the best way to encourage someone to develop better habits is to talk about your own wins and losses. Like “I made a big student loan payment this month” or “I forgot a bill and totally screwed up my budget.”

They might think you’re weird at first but remember this saying that I love: “at first they’ll ask you why you’re doing it, then they’ll ask you how you did it.”

Establish Boundaries

Some parents are travel agents for guilt trips. Passive aggressive text messages, reminding you how hard it was to raise you, and assuring you this is the last time they’ll ask you for money and they will definitely pay you back this time are just a few of the lines I’ve heard personally and from friends.

Know that their financial situation is in no way your fault. No matter what it cost to raise you, if they put you through college or if you still live with them, their money is NOT your responsibility. Parents give their children money, credit cards, and other material items of their own volition (whether the amount is appropriate is another topic entirely.)

fathers financial mistakes

Don’t be bullied or guilted into giving more than you’re able. Prioritize your financial and emotional state then give your money and time accordingly. And never give money to your parents. If they need a bill paid or something then you buy it or pay it. This way you know where your money is going and that you’re getting the best deal.

If you want a good book to read on this subject I highly recommend Boundaries by Henry Cloud. It covers boundaries in relationships, family, work, etc. If you feel overwhelmed and overworked, you might benefit from it.

Give Some Grace

Our parents get a lot of financial flack for the recession, with good reason. But so many were suffering from a lack of financial knowledge that wealthy companies were capitalizing on. To an extent I think millennials can relate. We’re labeled as having a collective poor work ethic and entitlement when in reality we had to start from a point far from the platform baby boomers launched from.

financial mistakes

I love this article by Sarah Kendzior on Quartz about the myth of millennial entitlement being created to hide the mistakes of our parents. It’s not all pointing fingers, she explains instead of the media vilifying each generation, our struggle is actually the same.

“There are plenty of older people with few retirement savings, with their finances drained from paying for both elderly parents and jobless children. We need to acknowledge the way our struggles are intertwined, instead of allowing the media to stoke manufactured class and generational resentment.”
-Sarah Kendzior

So while it’s ok to be angry, give grace to your parents. Their generation was much more isolated, openly judgmental, and oblivious of what was to come in 2008. We all have our own struggles and while they are different they often have similar root causes.

Break the Cycle

In the end, you can do all these things and see no positive changes in your loved ones. The only person you can change is yourself. If you break the cycle in your own family, you’ve won. Even if you have to pay for your parents’ financial mistakes, your children won’t have to pay for yours.

Jeff Rose, a financial planner, author, and blogger behind Good Financial Cents explains how to not make you parent’s financial mistakes. One way is to educate yourself on finance through classes and blogs. There’s no shame in purchasing a course about money management. And if your family won’t listen, talk about money with your friends, you might find it’s less awkward than you’ve been led to believe.

Have you experienced financial stress due to a parent’s mistake? What have you done to break the cycle?

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Parent's mistakes

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16 Comments on “When you Find Yourself Paying for Your Parents’ Financial Mistakes”

  1. This post hit close to home for me. My mom was and still is notoriously awful with money, it led to her and my father’s divorce. She helped me with all of the college applications and FAFSA and navigating the loans. During my second year, her and my step dad were in a rough spot with their finances and she asked if I would take out a student loan for more than I needed and give her the money. I was given the same guilt trip; it was so difficult and expensive to raise you, I’ll pay the payment when it’s due, blah blah blah. Fast forward 4 years when I’m in repayment. She paid the payment for about a year and then decided she didn’t need to anymore because ” I owed her”. Now, I am stuck paying the minimum payments on my student loans and accruing interest . I have tried to move and tried to help her make more sound financial decisions (like not leasing a vehicle) but she doesn’t listen. It’s the definition of being stuck between a rock and a hard place. If it weren’t for my dad, a successful farmer and business owner who is great with money, I feel that I would be wandering down her same lost road.

    1. I’m so sorry to hear that. But the future is so much brighter now that you’ve seen what that looks like and you know how to do it better! We can’t change our parents but we can protect ourselves and out future. Good Luck Daisy!

  2. Great post! This is such an open and honest look at problems so many people face. My husband and I talk all the time about our parents and their bad financial decisions. However, we have yet to actually sit down and have some open and honest conversations with them. Thank you for sharing not just your testimony, but sparking me to start the conversation with my own parents. I will be sharing this with my husband as well.

  3. Thankfully both my parents and my husbands have been wise with their finances. I so agree with you about breaking the silence. We went through Financial Peace University right after we got married, and it was the best thing we could have done for our finances. We’re already talking about how we’re going to teach our children to handle money appropriately.

    1. That’s awesome Christine! And so encouraging to hear. I hope they know know how blessed they are!

  4. What a difficult situation to navigate! Many years ago, my friends parents let it slip at almost the last possible second that their house was going to be foreclosed on. Luckily, he was able to pack them up and get them into a new place, and short sale the house before it went into foreclosure. He was so angry he only had a couple weeks to arrange everything, if they only told him sooner it could have saved everyone involved a whole lot of stress.

    My partner and I openly talk about our finances in front of his son. We want him to know that when we do splurge, it means we don’t get to do something else-that each choice we make affects us elsewhere. It’s not that we’re rich, it’s just that we choose what to spend our money on.

    1. It’s so important to establish that difference. I’m glad to hear you’re teaching him to balance splurging and saying no!

  5. In the last few years I’ve come to take over the investment aspects of my mothers financial life. She has done things in the past like sell everything at the bottom of the market which has truly hampered her savings. That being said she has a pension to save her as long as she manages it properly going forward. I’m glad I got involved when I did because she was about to cash out the pension and invest it using her same methodology.
    FullTimeFinance recently posted…Dealing with Money StressMy Profile

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