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Many of us adults are caught in a big juggling act. Obviously, we’re taking care of our own finances. However, we’re also faced with teen or young adult children who might still need our financial help. Moreover, our parents might need assistance as well. It’s hard to know what the right boundaries are in any family. For example, what if your parents have debt? Should you help your parents get out of debt? Or should you wash your hands of it all? Or is there some in-between option?

Every Family Is Different

Every family handles their finances differently. Some families talk very openly about money whereas others never discuss the topic. In some families, parents tend to feel responsible for their children’s finances no matter how old the “kids” are. In contrast, some families feel that adult children should help their parents. This is cultural, social, and individual. So, ultimately, you’re going to have to take your own family’s issues, preferences, and beliefs into consideration when deciding if and how to help your parents get out of debt.

Your Parents Are In Debt: 2 Possible Scenarios

There are two different scenarios that might bring about the question of whether and how to help your parents get out of debt:

Your parents have requested your assistance.
Aware of your parents’ debt and concerned about their future, you want to offer to help your parents get out of debt.

There’s another scenario that’s unfortunately common as well. You and your parents are both aware that there’s a problem, however you haven’t discussed it outright. Your parents might complain about debt, for example, but neither of you have discussed the depth and breadth of the issue.

Step One: Talk About How to Help Your Parents Get Out of Debt

Regardless of the situation, it’s time to have a conversation. Talking about money often poses challenges. Many families find themselves arguing, bringing up old issues, and generally feeling discomfort when talking about money. However, the only way to deal with the situation well is to deal with it head-on. (Note an important exception: if your parents are in late stages of memory loss, you may decide to take over their finances. This is an entirely different situation that must be handled in its own unique ways, including through legal means.)

If your parents have asked for your help, then the door is already open for this conversation. Otherwise, you’ll have to bring it up. Broach it firmly, kindly, and respectfully. Let your parents know that you want to discuss debt and ask about a good time to do so. Bring up your own concerns about their debt. Ask about their concerns and thoughts. As best as possible, you’ll all work together to figure out a plan that works for everyone.

If your family is unable to have these types of financial discussions, then you might want to consider family therapy together. There are therapists who specialize in discussing finances. As a result, they can help you navigate the tricky parts of this big issue. Moreover, they can help each of you figure out your wants, needs, abilities, and boundaries. This is a key part of figuring out if and how to help your parents get out of debt.

So, Should You Help Your Parents Get Out of Debt?

Obviously, you need to consider a lot of factors in this conversation about how to help your parents get out of debt. Whether or not you decide to assist them depends on a huge variety of factors. Ultimately, it’s up to you. However, there are some key things to consider that can assist you in making your decision.

Benefits of Helping Your Parents Get Out of Debt

Here are some of the reasons you might want to help your parents get out of debt:

You’re able to do so while they are not. If you’re in the financial position to help and you genuinely want to then there’s no reason not to move forward.
Socially, culturally, and personally you believe that children should take care of their parents. They raised you and now it’s your turn to help.
You want your parents to have a high quality of life moving forward. If they get out of debt, that increases the likelihood. After all, debt is stressful!
It’s important to you that your parents’ long-term care plans are in place. If they’re drowning in debt, then they might not have a plan for the future.
Your parents might be able to help you out in exchange. For example, you might ask them to provide childcare. Everyone contributes and everyone wins.

Drawbacks of Helping Your Parents Get Out of Debt

Here are some of the things to consider before you take on your parents’ debt problems:

It’s a financial burden. Taking on anyone’s debt is hard. Make sure that you’re in a financial position to help before you offer to do so. After all, if you go into debt to pay off their debt then you might end up struggling.
You might feel resentful. If dealing with their debt might put a strain on your relationship with your parents then you have to think carefully about whether or not it’s worth it.
Your spouse might not be on board. Dealing with in-laws together is hard. You want to get on the same page before moving forward with paying off parents’ debt.
They might go back into debt. If your parents aren’t financially responsible, then paying off their debt may not help them out. They may revert to old habits and end up in the same position again.

Middle Ground Options

On one hand, you could pay off all of your parents’ debt. On the other hand, you could tell them to deal with it themselves. However, you don’t have to go to either of these extremes. Discuss middle ground options with your parents. Some of these options include:

Lend them the money to pay off their debt. They can pay you back without interest. As a result, their payments might feel more manageable.
Assist them in better money management. If they’re open to it then they might just need help figuring out how to handle their debt.
Offer them a job. As aforementioned, you might have them do childcare. Or a variety of other things that assist you. In effect, you’re “paying” them for their work by putting that money towards their debt repayment.
Pay off a portion of their debt. You might pay off the debt with the highest interest rate or highest balance, for example. Then they can take over from there.
Make a plan with your siblings. Getting the whole family involved might ease the burden a bit.

All in all, you want to consider your options carefully. There are certainly pros and cons to assisting your parents with paying off debt. It’s a very personal decision.

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According to a Google Consumer Survey, 62 percent of Americans have less than $1,000 in their savings accounts and 20 percent of Americans have no savings account in place at all. However, if you are planning on having a baby, you may be paying more attention to your spending and putting more thought into starting a savings plan for your growing family.

If you are planning to start a family, you may be wondering about your finances and whether or not you’re ready to have a baby. Diapers, baby gear, clothing, toys and unexpected costs that come along with having a baby can be overwhelming. Some couples try to save money to prepare for the birth of a child, but how much should you save?

This is a huge question and really depends on the time frame as well as what you choose to cover with your “baby savings.” There are a few things you should take into consideration when you start your baby fund. Will you lose any wages from the birth of your child? Will you be a stay-at-home parent or will you have to pay for childcare?

Check out this Baby Cost Calculator on Mom Loves Best.

Hospital Bill: $10,000-$12,000

People with insurance will usually have most of their hospital bill for the birth of their child paid for. Most couples with insurance only pay a few thousand dollars out-of-pocket. Those without insurance pay up to a $12,000 hospital bill. You will also need to save for other medical bills like OB/GYN appointments and doctor appointments for the new baby if you do not have insurance or you have a high deductible.

Supplies: About $8,700

When it comes to nursery supplies, food and milk, there are some things you can’t do without when it comes to your baby. However, it is difficult to decide what you can skip. Here are a few areas that are must-haves, but there may be a few ways to cut down the cost.

Formula and Food – $2,000 – You may be able to cut this cost down if you breastfeed for as long as possible.

Nursery – $2,000 – Setting up a nursery can be a pricey venture. Before you buy the best and most expensive of everything, do some research and prioritize when spending on furniture for your nursery. Invest money in things that you think you could pass down through generations, like a rocking chair, and not on things like a changing table.

Baby Gear – up to $2,700 – Strollers, play pens, carriers and other baby gear can get expensive. If you can, find two-in-one items. You will be able to get more use out of these items for your money.

Diapers – $1,000 – Diapers and bathroom supplies for babies can add up. One way you can save on these items is to buy them in bulk online. Diapers, baby oil, wipes and other items are things you will always need, so they will never go to waste. Buying online (check out Diapers.com) and in bulk will save tons of money.

Clothing – $1,000 – Clothing for your new baby can get pricey, but it doesn’t need to be. You can buy items off-season and you can also buy bulk outfits (multiples). Another great way to save on clothing is to scout out secondhand stores or yard sales for baby clothes.

Other Expenses: $24,000

Will you be taking a maternity leave? If so, is it paid? If not, you will have to budget and save money to make up for the lost hours at work. Most people recommend setting aside about $8,400 if you’ll be missing work for an unpaid maternity leave. Once you go back to work, you will likely have to get childcare, which will cost approximately $9,000 a year.

You may also need new insurance for your little one and will want to get a will prepared to protect them if something were to happen to you.

The grand total for saving for a baby would come out to about $43,000. Not many people are saving that much. However, if you are thinking about starting a family, saving should be something you are putting some thought into. Many couples use automated savings transfers or deposits to keep them on track for saving for a life together.

No matter what stage of life you are in, be sure to continue to save money — you never know when you may need it. This calculator can help you decide how much to save for a baby.

Photo: Flickr: mulan

Is It Ever Okay to Help Your Parents Get Out of Debt?