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Dear Moneyist,
My husband and I have been married for 12 years. We have two small kids, and we both work and are doing well financially. We’ve paid off all our student loans, we put down 20% on our mortgage when we purchased our home, we have a great income-to-debt ratio, we’ve already amassed a great 401(k) nest egg and, overall. we’re in a good, comfortable place.
My in-laws, on the other hand, are not faring so well. My father-in-law owned his own business that went south and he’s still trying to revive it, and my mother-in-law has never worked a day in her life, even now with four kids grown and gone. They are an old-school couple where the wife is completely in the dark about the finances and the husband is too proud to share any details.
They asked us to co-sign student loans for my husband’s younger brother a few years ago. That was my first inclination that things were not going well. I told my husband, “We’re not mixing family and finances.” His brother was on his 6th year as an undergraduate at that time. I’m worried that, as his parents get to an advanced age, there will come knocking asking for money.
I’m not spending all my days as a working mom away from my kids only to support my in-laws. What can we do? These are people who have never worked and have made poor financial decisions. No one has the courage to speak frankly with my in-laws to ask things such as, “Have you maxed out your credit cards? How many mortgages do you have?”
Everyone is just ignoring it to avoid the drama and confrontation. How can we pro-actively manage this to keep the peace? Am I wrong to not feel obligated to support them should it come to that?
Worried Wife
Dear Worried Wife,
Sometimes, family elders are the ones who need parenting. If you’re lucky, you get to step in.
If you talk to your in-laws about their finances when you feel fearful and resentful about the role you believe you will have to play, it will probably go as well as you expect it to go. Not very well. Those who say, “I don’t like confrontation!” may find it difficult to speak about an awkward situation without showing their displeasure or losing their cool. It’s only a confrontation if you believe it to be one.
My point: It’s all a matter of perception. The last time I went to the optometrist she tried different lenses for me to look through. I could read some lines on the chart better than others. You too need to look at all of this through a different lens. Rather than approaching it with a long-simmering grievance (“I’m not responsible for these people”), say this instead: “What can I do to help?”
The Financial Therapy Association takes a holistic approach to managing personal finances, including your history, anxieties, relationships, and your emotional life. Other organizations that may be worth contacting include the American Association of Daily Money Managers, the National Academy of Elder Law Attorneys and the National Consumer Law Center.
Organizations such as these and the help of a financial adviser will give you and your in-laws the information they need. Put on paper their income and expenses, and any plans for paying off any debt. An adviser will also show them how much money they will need to live comfortably in retirement, inform them about long-term care insurance and help them set tangible goals.
Telling your husband that you shouldn’t feel obligated to support his parents because you don’t believe they have handled their lives responsibly will hurt him, damage your relationship with your wider family and, possibly, cause discord in your own marriage. Instead, empower your in-laws to make better decisions. Paying for a financial adviser today as a gift would be a good first step.
It’s not a question of who is wrong and who is right. You are all on the same side here. It’s a question of what is the best path for your in-laws to take, and what support system you can put in place to help them get back in the black. Your husband’s parents are getting older. This is a good time to act, and provides you with a valuable moment to build stronger finances and stronger relationships.
This is your chance to take the lead in your family and to be the grownup. Take it.
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