Helping Parents in Debt. or Not?

ednamekin on 14/08/2019 - 14:24
Last edited 16/08/2019 - 21:45

Getting on the back of this post, as I'm watching something similar happen to my own family:
https://www.ozbargain.com.au/node/476489

Sorry in advance if the information seems all over the place, but I'll do my best.

Question: What are my options on sorting out unemployed / in debt parents?

Situation: Asian background (so there's a cultural tradition of looking after parents). I live with my wife in a house, parents live with me, and so does brother. Mother's a housewife, father unemployed last 3 years. I find out a couple weeks back that the parents have almost nothing to their name, and a whopping $40k in debt spread across a personal loan and 3 credit cards (interest between 12 to 20%). They used to pay me rent, but stopped 1.5 years ago. Brother doesn't pay rent, but he's giving around $500/month to parents to stay on top of their minimum repayments. I've made them cut a few stupid expenses (like a cleaner and Foxtel ugh), and fixed expenses are down to around 500/mo if any rent owed to me is excluded.

I have some savings, but looking at their capacity to repay, anything I give them would not be returned, hell there's 1.5 years of rent to pay first. Also I'm not sure if I am liable for any of their debt as their child, maybe they should just go bankrupt and be managed by a trustee.

Options I have thought of:

  • Purchase their furniture (they own 60% of the house furniture, if I take it off them they can use the funds towards debt, and I also control the furniture)
  • Give them money to get out of debt (lost money, puts myself in worse position)
  • Seek ways to evict them (I've only seen articles on parents evicting their kids, not the other way round)
  • Power of Attorney over all their finances?
  • Set up a formal loan agreement with them where I act as the debt consolidation loan provider (don't know how much this will hold up)
  • Bikies (not a nice one, may damage the house)

Edit: added a poll, removed eviction as that was a stupid thing to even include (and the list isn't exhaustive anyway).

Edit2: Thank you for the poll votes, and detailed commentary and assistance. Have a rough plan going forward, have spoken to brother and he's good with it, now to take on the parents over the weekend.

Poll Options

  • 15
    Purchase their furniture so they can use funds towards debt
  • 27
    Give them money to get out of debt
  • 173
    Get them to declare bankruptcy
  • 5
    Power of Attorney over all their finances
  • 1
    Set up a formal loan agreement with them where I act as the debt consolidation loan provider
  • 25
    Bikies
Financial

Comments

  • ihbh on 14/08/2019 - 20:42
    +1

    Teach them how to fish rather than giving them fish - personal financial management. Provides them with valuable skills for the rest of their life.

    Sometimes being kind results in you being cruel. You might have compounded their financial irresponsibility by giving them money (e.g. free rent).

    What's their personality like? Are they simplistic? Uneducated? Undisciplined? Want to keep up with the Jones? Worked hard for years and feel that they need to enjoy the good life?

  • tsunamisurfer on 14/08/2019 - 21:36
    +17

    OP…I am so torn.

    As an Asian (in the case of Chinese background) you have a elevated responsibility to take care of your parents.

    But your parents are fking irresponsible with money and both them and your brother are taking you for a ride, it feels like helping them is enabling MORE financial responsibility.

    I hold the virtue of Filial Piety extremely high, but that has to be coupled with mutual responsibility. Of course we must help our parents, I happily take care of mum's bills so she can enjoy the Age Pension more, but they must also do their part in being financially prudent.

    If you simply clear their debts without conditions, they will simply get into more and push you deeper as well.

    I would :

    1) Get an undertaking from mum, dad and brother that they start contributing to the household. Garnish Parents' pension payments and give the Brother 3 months to find ANY job or move out.

    2) Amend their will so that any assets left are to go to you and you only.

    3) Cancel all credit cards and get them a debit card on a joint account between you and them.

    4) All expenses are to be endorsed by you.

    5) Demand access to their bank accounts and full power of attorney to gain full visibility on their accounts.

    6) Upon the above understanding, pay off the credit card to stop bleeding 13%-21% on %40k.

    Yes…I am treating your parents as children because that's what has become required.

    BTW…you have a VERY understanding wife.

    Does she have a sister?

    • horsome on 14/08/2019 - 22:37
      +8

      What good is tradition if people use it to disrespect you and your welfare. OP needs to lay down the ground rules or kick them out.

      • BabsBBS on 17/08/2019 - 01:35
        +2

        Because they took care of you when you couldn’t prepare your own meals as a newborn, shat your pants as a baby, cried when you fell over as a toddler and were sick shivering away in bed with a high fever when you were a kid. That’s why.

      • The tiger on 17/08/2019 - 16:41

        It is very cruel to kick your parents out when they are financially helpless despite of anything they are no good in managing their finance, esp. as a son who owns a house and looks o.k. financially. O.P. had said no gambling waste is involved. There must be some better ways out to solve the problem instead of just kicking them out to solve the whole problem.

        • horsome on 17/08/2019 - 20:13

          Yeah set new ground rules, parents have a place to live, everyone’s happy.

          Action is needed or OPs family will drag him down, then no one wins. Got to see past the tradition thing, it’s worth nothing if the respect isn’t there.

    • p1 ama on 14/08/2019 - 22:47
      +1

      As an Asian (in the case of Chinese background) you have a elevated responsibility to take care of your parents.

      Why is taking care of one's parents unique to people of Chinese background?

      Yes…I am treating your parents as children because that's what has become required.

      I still think this is a very strange thing to do. One of my general virtues about helping others is that you should only help them if you trust them. If you are just doing something "for someone's own good", then what you are doing is you are taking away their fundamental human right to make their own decisions and choose their own destiny. Some people have different life priorities and choose to do things differently to you, it doesn't necessarily mean that they are wrong. You shouldn't force someone to live their life according to what you think a good life is.

      The view I take is, sure, make it a precondition that they cancel credit cards and sell certain assets before you start contributing money to draw down their debt. And sure, even perhaps make up some contract or payment plan so that they will actually pay you back.

      However, taking control of all their finances is going too far. If they are irresponsible, and they wish to live an irresponsible life and get themselves into debt again, then so be it. If you want to continue to help, then go ahead. If you don't want to, then that's fine - you shouldn't get involved anymore.

  • neo on 14/08/2019 - 21:51

    This must be a very difficult situation to handle. Some very good advice above. Wish you the best.

  • Placebo on 14/08/2019 - 22:44
    +1

    Help them engage with a Financial Counselor.

    https://www.moneysmart.gov.au/managing-your-money/managing-d…

  • bobbified on 14/08/2019 - 22:56
    +7

    I honestly have to say that OPs post was a difficult read. "How can you do this to your parents?" was what kept popping up in my head.

    After seeing what my parents did for me and my siblings when we were growing up and the sacrifices they made for us, I would be willing to give up anything and everything for them.

    I can't even imagine arguing with my parents about money. There is no "we own this and you own that" type of thing so there wouldn't be such a thing as buying their furniture off them.

    There's no way the thought of evicting my parents would ever cross my mind. Especially over money.

    First thing you should do is sit down and talk to them. Try to work things out as a family instead of resorting to third party solutions like Financial Management services or Trustees etc.

    • The tiger on 15/08/2019 - 08:53

      Hi, Bobified, I totally agree with you. Our parents bring us up and love and care about us unconditionally. They made so much of sacrifice for us. If we grow up and be able to be independent and making money all these are due to them. Now OP owns a house and it is horrific to know that he obviously considers collecting rental from his parents by staying with him is a matter of course. Think : did they collect any rent at all when you stayed with them plus your free board and lodging. It is not only ridiculous but unimaginable that OP has been collecting rental from his parents for staying in his house.And to think the idea of evicting one’s parents who fail to pay rentals to him. What a culture OP has as an Asia. Shameless!

      • Roman Sandstorm on 15/08/2019 - 15:18
        +2

        @bobbified

        what my parents did for me and my siblings when we were growing up and the sacrifices they made for us

        @The tiger

        Our parents bring us up and love and care about us unconditionally. They made so much of sacrifice for us.

        Yeah, yeah. Of course they did. They're parents. They chose to do this. By virtue of having children, they made a choice to accept the responsibility that goes with that. They were adult humans, not indiscriminatingly populating meerkats.

        No human parent has a right to enforce future obligation onto their offspring. This is a basic moral principle completely backed up by law in nearly every civilised country on the planet.

        Think on this: no child asks to be born. No child forces their own creation on their parents.

        Now, if a child is brought up with love and care and decent principles (all of which, by the way, cost nothing) then, depending on the confluence of their parent's, themselves, and their culture's mores, some may choose to further support their parents when they age/become infirm/lose their marbles/whatever. But, again, that is a choice, not an obligation.

        Where is High & Dry when we need a decent lecture on personal responsibility? It's a pretty basic libertarian principle.

        • bobbified on 15/08/2019 - 20:23
          +3

          No human parent has a right to enforce future obligation onto their offspring.

          There is nothing in the OPs post to suggest that the parents are trying to force OP to pay their debts. It sounds like OP has discovered the debt and feels like he needs to do something about it. Legally, there's no way anyone can force OP to help out his parents - no-one is arguing with that.

          But when it comes to morals, that's a different story. If it weren't anything, we wouldn't be having a discussion in this post.

          Now, if a child is brought up with love and care and decent principles (all of which, by the way, cost nothing)…

          You really think it costs nothing? Not everything is black or white or worked out with money. There are plenty of things that go on within a family that you simply cannot put price on.

          Most of us recognise the tough job our parents had bringing us up. They didn't just bring us with the bare minimum necessary. They could've just given us basic food, basic clothing and a roof and we wouldn't have been able to complain. But no, they gave us everything they could and much more than they had to. They pretty much always put our priorities above their own. They didn't have to do that.

          Their time is worth more than any money you can throw around. Their youth was spent on us. Reality is, if they didn't want to, they could've just abandoned or adopted us out and continued with their lives as though nothing happened.

          • [Deactivated] on 16/08/2019 - 10:20
            -2

            @bobbified: Ah yes, forcing your morals on others for a situation you've never been in. Classic.

        • p1 ama on 15/08/2019 - 21:47
          +1

          Yeah, yeah. Of course they did. They're parents. They chose to do this. By virtue of having children, they made a choice to accept the responsibility that goes with that.

          Yes, but there are a wide range of parents. There are parents who do all they can to provide for their kids, to make sacrifices for their kids, there are even parents who put their life and future on the line for their kids. Then, of course you have the parents who couldn't give two hoots about their kids and give them nothing but the bare minimum. Not to mention parents who abandon their kids and have no responsibility at all.

          So it's not like all parents are the same, children who have good parents should appreciate what their parents did for them. Of course, I agree with you that being helped by others does not oblige you to help in return, but you would be a selfish bastard if you turned your back on somebody who helped you (parent or otherwise). If you want to be a selfish bastard then that's fine, you have the right to be and I respect that.

          You're being purposely misleading here and you know it. Nobody is saying that anybody is obliged to do anything, none of the quotes from others you've presented ever say that there should be a legal (or even moral) requirement that kids pay their parents debts. You talk big with "moral principle" this, and "the law" that, but you're trying to shoot down a strawman of the argument being presented. You would think that someone who references moral principles would stop to think about the most fundamental of all moral principles - that we should help others, especially those in need.

          It's a pretty basic libertarian principle.

          Isn't the "pretty basic libertarian" argument is that government support for the needy aren't necessary because their family and charities should be helping them out?

        • The tiger on 16/08/2019 - 10:39

          Roman, well you have your right to express your honest opinion here. One day when you become a parent of your child/ children, I bet you would have a differing opinion.From the text it seems O.P is doing quite well financially as he owns his house ? How many are able to own their dream house. here? Though I do not know whether his parents have chipped in financially a bit for his affordability to get the house, but may be they did in some other ways,His parents do not force his obligations as a son . They do try to pay him for their stay with him.. How many children ( esp. those with Asian backgrounds) would ask their old aged unemployed parents to foot their living expenses dues? We Asian are expected by MORAL/ culture to support our aged parents if they are not able to do so. In our culture it is a sin not to oblige so.Perhaps you are not an person with Asian backgrounds, so you are excused from this obligation. We give birth to our kids with a purpose .i.i. Ago love and to be loved in this world. We love them : we are more than willing to die for them; we eat less so that we can feed them better esp. on education side.I don’t mean every parents are like that ; but I dare say they are only a handful of them. Wish you well.

          • Roman Sandstorm on 16/08/2019 - 11:11

            @The tiger: @The tiger

            We Asian are expected by MORAL/ culture to support our aged parents

            This was exactly one of my points. A culture developed for poverty and peasantry; how suitable for the new world of rich Chinese?

            One day when you become a parent of your child/ children, I bet you would have a differing opinion

            A fairly basic logical fallacy. (Denying the antecedent?)

            I have never murdered anyone, hence I am not qualified to speak on how bad murder is.

            @bobbified

            There is nothing in the OPs post to suggest that the parents are trying to force OP to pay their debts.

            Correct. But the OP is feeling obligated, feeling conflicted, and it his particular culture and his acceptance of it, which is raising these feelings for him.

            With my white/Anglo/northern European upbringing, my parents made it abundantly clear that I did not owe them anything; no obligation, no expectation. The love and care was unconditional. Perhaps the other side of this is that I have no expectation of inheritance, etc.

            @p1 ama

            You talk big with "moral principle" this, and "the law" that, but you're trying to shoot down a strawman of the argument being presented.

            Almost a valid point. Perhaps I was extending the argument to get across my general principle. Giving a bigger discussion of parental/child obligation/responsibility than the OP expressed.

            Of course the OP can do what he wants. My argument is that I feel he is not morally (or in any other way) obligated to do so, and examining his culture may be a benefit.

            He should certainly not be castigated (or told what a horrible human being he is) just for asking valid questions.

            • HighAndDry on 16/08/2019 - 11:24

              @Roman Sandstorm:

              This was exactly one of my points. A culture developed for poverty and peasantry; how suitable for the new world of rich Chinese?

              Slight nitpick - when these cultural values developed (Confucian times), pretty sure China was one of, if not the, biggest and richest country in the world.

              • Roman Sandstorm on 20/08/2019 - 10:07

                @HighAndDry: Interesting question H&D, however… I'm sure the Chinese aristocracy were big and rich, but I wonder about the lot of the average worker/peasant/slave. Life of drudgery, brief life expectation, high infant mortality (esp females).

                I guess this pretty much sums up the majority of humanity until… 20th century?

                • HighAndDry on 20/08/2019 - 10:12

                  @Roman Sandstorm: Yeah - same all over the world. I was more talking about China the country as a whole. I think up till the 14th Century, China had the world's biggest GDP. Of course they then got complacent, became isolationist, burned their exploration fleets (effectively drank their own kool-aid) and was very massively leap-frogged by the Western European powers in science and technological development.

            • john_conner on 17/08/2019 - 04:47

              @Roman Sandstorm: “One day when you become a parent of your child/ children, I bet you would have a differing opinion“ I wouldn’t call this denying the antecedent. The Tiger is just suggesting that your view may be biased on your (potentially limited) experience.

              Eg. You can certainly speak about how to build a bridge as an undergraduate, but someone with 25 years experience building bridges all over the world may have a different point of view.

            • p1 ama on 18/08/2019 - 00:28

              @Roman Sandstorm:

              Of course the OP can do what he wants. My argument is that I feel he is not morally (or in any other way) obligated to do so, and examining his culture may be a benefit.

              Nobody is saying that he is legally or morally obliged to do anything. He should do what makes him happy. If he wishes to help out his parents, great, if he doesn't, fine.

    • gromit on 16/08/2019 - 08:50
      +1

      What do you mean "How can you do this to your parents?", seems blatantly clear that it is his parents doing it to him, as well as his brother. I think they really need financial counseling/bankruptcy, if you don't fix the problem now bailing them out won't help as they will just be in the same position again in a few years time. The OP seems to be doing an incredible amount already to look after his parents and his brother.

    • [Deactivated] on 18/08/2019 - 09:56

      You are lucky to have parents that did everything for you. I on the other hand had a very different and opposite experience to yours and it is ok for OP to not feel the same way as us. In my situation my parents took everything I would've gotten through inheritance and spent most of it and still living off the money from assets that belong to me. I have yet to take a legal action because they are my parents.

      OP is not responsible for his parents problems.

    • andyhwl on 18/08/2019 - 21:27

      I had the same reaction too. Then I chose to accept that the OP is stressed out at the time of writing.

  • Some Guy on 15/08/2019 - 01:45
    +2

    It's interesting that you consider a distinction between your father being unemployed and mother being a housewife.

    Introduce your parents to the gig economy. Get on Uber, Airtasker and what not.

    • BartholemewH on 15/08/2019 - 14:22

      I figured the distinction was made due to mother not having been involved with work for a long period whereas father is skilled but out of work.

    • ednamekin on 16/08/2019 - 21:34

      Father has been unemployed 3 years, had worked the previous 6. Mother worked overseas, but since moving here 9 years ago has not, so her role as a housewife was established.

  • mlbrooke on 15/08/2019 - 08:13

    It is irrelevant whether your parents brought you up and did everything for you as a child, you are doing the same for them now by having them live with you and supporting them as a good son.

    You have saved $40k and your right to maintain these savings is completely appropriate, there is no downside to your parents not paying their loans and declaring bankruptcy.

    Providing the assets in the property are legally yours and documented then there you lose nothing, your parents lose nothing except a clean financial record and it probably doesn’t matter if they are going to live with you and are not looking for work.

  • ozbjunkie on 15/08/2019 - 08:22
    +6

    Paying off their debts may not help, if they have managed to hide 40k debt from you this long with frivolous spending, or heaven forbid gambling.

    If they are unemployed with no assets, let them declare bankruptcy. Hopefully that stops them racking up debt again, as nobody will lend them money.

    If you pay off their debts, they will probably accumulate them again. Up to you if you want to enable that.

    • ednamekin on 16/08/2019 - 21:37

      Finally was able to see a bit of a bank statement, although this was for the past 3 months there was thankfully no gambling debt. May just be 3 years of no income drying up reserves.

  • brad1-8tsi on 15/08/2019 - 09:08

    How old are they?

    Are they Australian citizens or permanent residents?

    Are they entitled to any government support such as pensions, rent assistance, etc?

    To me, there's no such thing as unemployed.
    If they are physically able they can clean houses, Uber drive, Airtasker stuff like dog walking or minor handyman jobs, ironing, light gardening work, etc. They can recycle metal, babysit. it's all a lousy hourly rate but it's money. You should see all the pensioners that catch a train into the Sydney CBD every day and collect Return & Earns to supplement their pension at 10c a bottle.
    Your Mum could get an early childhood qualification and work at a childcare centre.

    Working will also help their self-esteem and give them less time to spend money on useless crap.

    While you need to help them as much as possible, they need to get of their bottoms and help themselves a bit too.

    • ihbh on 15/08/2019 - 14:28
      +2

      If they are physically able they can clean houses

      That's heresy. They had cleaners.

      • brad1-8tsi on 15/08/2019 - 15:13
        +4

        They must be lazy old buggers then.

        How can Mum be a housewife if she doesn't clean?

        • frewer on 18/08/2019 - 20:54

          Maybe she has a bad knee or back

  • agalea101 on 15/08/2019 - 10:22

    Are the debts still with the bank? If not then you could neg 30/100 in the dollar to clear the debts if with mercantile agent or collections.

    Though it will just be a matter of time before they apply for more… Best for a Financial advisor to help go through free bankruptcy through government… otherwise they will depend on you again and again … Fyi love my parents but this is the hard truth

    • ednamekin on 16/08/2019 - 21:36

      Still with the bank. I'm not sure how the hardship assistance works, and whether they accept settlements in a similar format.

  • nikey2k27 on 15/08/2019 - 10:24

    help them out a little bit

  • SpotTheOzzie on 15/08/2019 - 10:25
    +6

    You have had cleaners when they've been unemployed for 3+ years..what do they do all day? If you're Mother is a housewife what is she doing exactly?

  • witsa on 15/08/2019 - 10:45

    your post doesn't really specify what you're actually trying to do. Do you want to help them out, do you want to re-coup your money?

    Not sure what evicting them (or bikies?) will do other than making them homeless.

    Assuming you want to help them and assuming they're elderly and have no capacity to earn, this is what I would think to be the best option.

    Buy all their assets like the furniture or whatever else. If they haven't already, get them to max out all the loans they have. Use this money for them to "repay you" for the lost rent.

    When they have absolutely nothing in their name and no capacity to borrow anymore - declare bankruptcy.

    Since the money they took out was to legitimately pay you for a debt they owe and they have nothing, bankruptcy sucks but it'll mean that there'll be nothing that can be seized by creditors.

    Once bankruptcy is declared, try to get them on the pension. You may also be eligible to get some money if you count them as a "dependent" since they're living with you. But you'll have to look at what the centrelink policies are there.

  • samfisher5986 on 15/08/2019 - 10:47
    +4

    There are so many strange comments in this thread to the point where it seems like you guys would be supporting your parents gambling addictions, because thats essentially what being financially irresponsible is, compulsively making the wrong financial decisions, like having a cleaner and foxtel when you are unemployed.

    They need to get a job and pay off their debts so they can be independent. Your help should be centered around how you can help them do this, rather then solving their problems temporarily until they need your help again. And its going to happen again and again until they get a financial education through being financially independent.

    • SpotTheOzzie on 15/08/2019 - 11:26
      +5

      LOTS of virtue signalling in this thread.

    • brad1-8tsi on 15/08/2019 - 15:15
      +3

      Oh mate. But it's his Mum & Dad. They can do what they want because they brought him up. /sarcasm

  • SpotTheOzzie on 15/08/2019 - 10:58
    +6

    On a related note my partner is very skeptical about her parents being able to control their savings. The Mum/Dad tends to do a lot of questionable stuff. For example being scammed several times from people back in China with what would be very obvious cons but it's happening over and over again. The concern is that they'll just randomly throw their entire savings and rock up on our door step in debt and wanting to stay over. I use to feel sympathy towards them but it's every other month now. No matter how many interventions my partner has had there's some delusion of 'get rich quick' where they don't consult us and just throw money at lucrative promises and the worst part there's probably a lot more that they just haven't told us yet.

    How has anyone been able to get through to people like this and ensure they don't blow everything? Supporting them financially is not an option as it would just be like feeding a crack addict who has had "they're last fix, I swear" and I'm not prepared to have my entire life upside down because of other people's wreckless behaviour.

  • happirt on 15/08/2019 - 10:58
    -4

    some good kids buy houses for their parents. the least you can do is pay off their debt. it's not too much to ask. they brought you into this world after all. tell the brother to lift his game and help out.

    • [Deactivated] on 16/08/2019 - 10:26
      +1

      brought you into this world after all. tell the brother to lift his game and help out.

      This logic right here is so stupid.

      I didn't choose to be born.
      I didn't choose my parents.
      I didn't choose how they raised me.

      My birth and childhood is on them just like their own stupid spending habits.

      some good kids buy houses for their parents.

      Yes, the kids who can easily afford to. The select few who manage to make the big bucks.
      Not your every day kid who works earning the average adult wage and will struggle to pay off their OWN house for 20+ years.

      the least you can do is pay off their debt

      What the (profanity)? They're grown adults who got their-selves into debt. The risk they took means they should face the punishments involved. If that means bankruptcy, then so be it.

      • happirt on 16/08/2019 - 10:38
        -2

        This logic right here is so stupid.
        I didn't choose to be born.
        I didn't choose my parents.
        I didn't choose how they raised me.

        who said there was logic in love, robots?

        Yes, the kids who can easily afford to. The select few who manage to make the big bucks.
        Not your every day kid who works earning the average adult wage and will struggle to pay off their OWN house for 20+ years.

        that's what i said, "SOME" kids not "ALL". But I understand your frustration because you're not part of the cool rich group. you just have to play the cards you're dealt in life lol

      • SlavOz on 17/08/2019 - 10:51
        -1

        LOL

        You didn't choose to be born. But you did choose to eat your parent's food, sleep in the warm dry bed they have you, stay inside their house where it was safe, take advantage of their financial generosity. You chose to freeload of your parents for years, and they probably had many second thoughts about raising such a stupid child that shit his pants and cried all day. But they persisted. You chose to put your financially indebted to your parents. You didn't have to live the nice life they gave you.

        • [Deactivated] on 17/08/2019 - 11:00
          +2

          Freeload?
          Do you expect a child to go out and earn their living or something?
          It's not freeloading if you literally are unable to earn ANY money.
          That's like calling someone with no legs "lazy" for not walking to the shop.

          I was out of home the second I legally could.
          But keep going.
          Call me stupid. It's clearly self projection.

          • SlavOz on 17/08/2019 - 11:06

            @[Deactivated]: No, I don't expect you to get a job as a child. What I expect is that you follow your own financial advice when you're a child - if you can't afford certain luxuries, don't use them. Surely you would've realized eventually that the warm bed and nice food your parents were providing you was costing them money. Why didn't you take the financially responsible route by foregoing those luxuries? Instead, you chose to enjoy them without thinking of the financial repercussions on your parents. You probably also asked for toys, colouring books, and candy when you were a kid, despite not having the money to pay for these luxuries. You were freeloading mate. Your parents let you get away with it, nice to know you're happy to walk away from them when you dont need them anymore.

            • [Deactivated] on 17/08/2019 - 11:35
              +2

              @SlavOz: You're beyond stupid.
              I never asked my parents for a thing.
              They CHOSE to buy those for me.

              You're trying to compare the mind of a grown adult who's spent a large chunk of life financially independent to that of a child.
              Please shut the (profanity) up.

              Not even sure why I'm trying to reason with someone whos answer to OPs situation was 'tell your parents to go back to where they came from"

              • happirt on 17/08/2019 - 17:20
                -1

                @[Deactivated]: There are parents in this world who force their own young children to make a living for the family. Take a look at child exploitation in India and other parts of the world. In Australia not as harsh but there still are many parents who neglect their own children. Divorce rates are high though so many come from broken families.

                You didn't choose to be born, or where you were born. Don't you have any gratitude you were not born in those situations, and that you had parents who looked after you?

                Personally IDGAF what your situation is, you sound like a miserable bastard. Perhaps it's how you were raised lol.

                • [Deactivated] on 17/08/2019 - 22:05
                  +1

                  @happirt: Ah yes, I'm so miserable I paid for my parents mortgage and life saving surgery on my mother :'((((
                  Sorry that I pay for stuff because I'm being nice, not because I'm some cucked little bitch who feels they owe someone for spending money that I had no choice over.

  • tempura on 15/08/2019 - 11:05
    -1

    in all honest, i don't see any other option will help your parents except this:

    Give them money to get out of debt (lost money, puts myself in worse position)

    • samfisher5986 on 15/08/2019 - 11:09
      +5

      I'm sure thats what the parents want him to think.

      • tempura on 15/08/2019 - 11:12
        -1

        if there's conspiracy theory happening between the parent and their kids, then I'm speechless. in my view, there should be what's called transparency and honesty in family. if you don't have that then … i don't know what to say really.

        • samfisher5986 on 15/08/2019 - 11:41
          +3

          OP makes it pretty clear that there is no transparency with him "finding out" things years after he should have known.

  • daleyboy79 on 15/08/2019 - 11:37
    +9

    Parents should apply for bankruptcy, they'll never be able to buy their own home etc after that, but hey doesnt sound like thats ever gonna happen anyway

  • Trying2SaveABuck on 15/08/2019 - 12:10
    +6

    'Asian culture' - normally the parents have loads of cash and the kids are sponging from what I've seen.

    Your mum is a house wife but they had a cleaner? not being sexist but WTF do you think house wifes do?

    Your dad hasnt worked for 3 years refer to above comment why do you need a cleaner when you arent working? clean your own house?

    they havent paid rent for 1.5 years - i wouldnt charge my parents rent so this point is moot to me i would ask my brother for a bit $$ but more so to cover bills etc other relatives i'd prob ask for money but i wouldnt expect much because i like to think if i was down they would help me.

    Your brother is giving them money? why? let them go bankrupt!?

    Kicking them out? - i see where you are coming from but i'd never turn my back on my parents or family but thats who i am

    Tell you parents to apply got bankruptcy and tell you brother to STOP GIVING THEM money put that 500 in an account that you could use to help them after all the bankruptcy stuff is over

    If you dont mind what kind of Asian are you because honestly im Half Asian this is so different to Asian culture i dont understand it. If anything Asian women are clean freaks! and the men work like machines and would NEVER waste money on shit like foxtel

    • 91rs on 15/08/2019 - 12:35

      Good point about the $500 from brother, put it in to another account and pay their bills from the account they do not have access to.
      As the CC debt is lowered have them on front of you call the CC company and have the limit lowered every couple months so you remove the chance to fall back in to the same debt.

    • happirt on 15/08/2019 - 13:48
      +7

      It is rubbish to believe "Asians are clean freaks", have you seen the state of some of these Asian countries? It is rubbish.

    • trapper on 15/08/2019 - 18:17

      Brother should be paying 1/3 rent and bills realistically.

    • p1 ama on 16/08/2019 - 00:07
      +1

      If you dont mind what kind of Asian are you because honestly im Half Asian this is so different to Asian culture i dont understand it. If anything Asian women are clean freaks! and the men work like machines and would NEVER waste money on shit like foxtel

      No point trying to generalise. There are over 3 billion Asians in the world, you think every one of them is a clean freak, works like a machine and doesn't spend money on Foxtel?

      • Trying2SaveABuck on 16/08/2019 - 04:52

        Of course i just find it odd thats all. Most of those Asian 'who live lavish' are mega rich!!

        Its culture of we are wealthy and we show it (and sometimes acted like it). Opposed to we are broke but pretend to be millionaires and buy everything on credit…

    • Autonomic on 16/08/2019 - 15:26

      Asians aren't a monolith

    • ednamekin on 16/08/2019 - 21:40
      +1

      Spoke to brother, interestingly he thought the 500 was coming to me as "their" rent! And I wasn't asking him to pay rent because I considered this 500 he's giving to be his duties. After talking to him we agreed that the best immediate thing to do is set up a joint bank account, deposit money in there, and freeze the credit accounts.

      • andyhwl on 18/08/2019 - 21:33

        Mate if I rent a room out to a student, that would be 200pw including bills. Try asking him nicely to help with the bills?

      • Trying2SaveABuck on 18/08/2019 - 22:33

        Honestly dont understand how your brother thought giving money to your parents was paying rent to you?

        • ankor on 19/08/2019 - 06:48
          +1

          parents probably told the brother a fib to get that $500.

  • Illian on 15/08/2019 - 12:14
    +1

    This is a personal decision because it really depends on how much you like them or are close to them. You have zero obligation to them considering they did it to themselves, bankruptcy seems like a decent choice.

  • mousie on 15/08/2019 - 12:17
    +2

    Here's some constuctive advice:

    I would recommend that your parents have a joint session to see a qualified financial counsellor; there are many not for profit organisations which can assist with this.

    Also, developing a realistic budget including income vs expenses is a step, rationalization of discretionary expenses is important - sounds like cutting Foxtel etc was a good step. But having an 'entertainment budget' i.e. $30 each per week is a 'reasonable expense' too, you have to live.

    Under financial hardship grounds, and as the debt is classes as unsecured i.e. not associated with a property or vehicle and rather living expenses, entering a hardship variation would be appropriate with some of the creditors.
    This will prevent future lending from the same creditor, which may be a good thing or a bad thing if there is a potential upside the financial situation.

    Typically as an industry, creditors have a back of the envelope figure as to what they will and won't accept within their policies. I.e. if unexpected unemployment occures - a one-time settlement offer from a beneficary such as yourself or your brother, may be accepted. 40c cents in the dollar is 'reasonable' in this regard.

    If you have the cash up front to do this, than do. If they have superannautaion, there is limited acess to this money available as it shuold be preserved to retirement, but 10k can usually be accessed per annuam to assist with urgent household expenses such as the maintenance of a car, or replacement of a failed whitegood.

    Good luck!
    My experience has been working with a provider that specializes in Part IX debt agreements as a system dev at one point.

  • 91rs on 15/08/2019 - 12:30

    You need to look at what will cost you the least as far as long term.
    If you do little to help or try fix the situation now will it then balloon and will you be stuck with a bigger problem at larger cost to yourself and your wife later in life? Cost not just being dollarydoo's but freedom, ability to get loans in future if needed (if they are seen as dependents), if you're willing to live with them forever or walking away from them or the situation etc.
    I'd start with wither financial planning or getting a dollar by dollar breakdown of what they are currently spending to see what can be eliminated to start with.
    Then assess that Vs any income from govt as offset. If they're living with you I'd be wanting to know myself exactly what is spent when its impacting my life.

    Next assess ability to work even if its just walking blocks dropping off newspapers and stuff. It also gets them out of the house to avoid spend while doing nothing.
    Plenty of free online courses and things offered by Tafe from time to time, then puts then in a student situation where they might get more govt assistance?
    Sign your dad up for some agencies even if its temp work (Adecco or similar) they might be able to find him something.

    Who's paying for the bulk of food eaten, does everyone feed themselves or are they living off your kitchen? This is another cost to assess that adds up quick.
    Work out meals and plan accordingly for the household to try reduce costs, does your mum cook? Something you might be able to involve her in.

    Sort your bother out, is he similar age? working? studying? to assess a level you both should be able to agree upon to assist in the situation. $500 Per month sounds cheap for rent is that's what he's paying to your parents, however depends on income that's not mentioned.

    Govt housing, while in very short supply might be worth signing them up to the list so they can live without you and your brother.
    If your brothers not holding his own after this then he needs to step up or out.
    You also need to draw a line at where your assistance will end or has a limit, this needs to be made clear to both them and your brother.
    Assess things like kids, travel, house, moving (if you wanted to leave the area or country to live elsewhere) and have some clarity on those topics.
    I'd avoid anything petty and ideas like buying furniture off them for "control of furniture", if that's a thing you shouldn't be helping at all. Its only going to cause more conflict later and then you're also taking their only assets off them which is a bit of a kick in the balls and means they have nothing to move out with and would never do so.

    I'd be pushing for a deal where you take care of the debt (without assuming it and taking liability), only on the basis that they undergo much of the above financial examination and scrutiny to avoid this in the future, get them working or some other income to go along with any govt assistance where possible, move out and if possible in to govt assisted rentals, possibly your brother lives with them to help with bills?
    Put a deadline on it however.

    Any money spent will be lost money, it wont be seen again which I can hear the cries and tears of OZB'ers everywhere about.
    Had similar situation where had to take on a newly or to be divorced parent, had no assets (no value), divorce dragged out and got next to nothing from it due to debts and depreciated house values (couldn't sell at a profit or break even in rural area), very poor health (many hospital and specialist visits), unable to work etc.
    Easily cost me $150k+ in the several years living with me until I could sort most of the above out for them, still costs me from time to time but they're on their own feet to an extent but very much living in their means which can be quite sad to see at times.
    I've already written off the chance or situation to have kids, buy a house in Australia and a few other things due to a few setbacks, this includes knowing that in the future I will be up for more assistance and money so they're not homeless and on the street.
    Zero assistance from any other sibling(s) as they don't want to be involved and don't want to be written out of any will from the other parent.

    Have very much come to the conclusion that if I'm in similar situation later in life (older age say 50+, health problems, no or little income and poor quality of life or would lead to poor QoL) to just end it, especially so I am not a burden on anyone else impacting their life in the way I've had mine impacted.

  • Whyutrippingfam on 15/08/2019 - 13:01
    +5

    Step 1: Get them declare bankruptcy.
    Step 2: Get them on centrelink benefits
    Step 3: Open a joint account and manage their expenses
    Step 4: Ask your brother to either contribute more or move out

  • Herbse on 15/08/2019 - 13:19

    They don't get any government income? Have you looked into carers income if you're looking after them.

    If you make enough income to not qualify for help from government assistance, then you need to cut back and just accept it. Take it as a thank you to them for looking after you until you were able to make it in your own.

  • innov on 15/08/2019 - 13:30
    +3

    If this were my parent's I'd pay off their debt. A very small price to pay for the first 18 years of debt I owe them.

    In saying that, I would be upset with my parents ever accumulating that much debt and how financially irresponsible they were in doing so.

    • [Deactivated] on 16/08/2019 - 10:32
      +2

      Stop referring to your birth and childhood as debt.
      They chose to have you and raise you.

      If you as a parent ever expect your kids to think they "OWE YOU" just because they raised you, then you are a horrible parent.

      • innov on 16/08/2019 - 13:31
        +1

        Without going into too much detail, I came from a very loving family who made significant sacrifices. I'll forever be grateful and owe them the life I live now in contrast to the other upbringings that I've seen.

        If you think you don't owe your parents anything because they chose to raise you, then you are a horrible son/daughter.

        • [Deactivated] on 16/08/2019 - 13:37

          Don't you dare tell me what I am or am not.

          I paid off my parents mortgage this year.
          Not because I think I "owe them" but because I was in a financially good spot.

          I don't owe my parents just because they made and raised me.
          That was their choice.
          I love my parents and I always will, but If they got theirselves 40k in debt and it was debt they could have avoided (e.g. they bought luxuries rather than necessities) that's on them.
          My parents said it their-selves, they would never except or accept my help for stuff they got into through their own stupid decisions.

          Thankfully my parents deeply consider every purchase they make.
          Heck, the only holidays they went on were paid by myself and family friends.

          • bobbified on 17/08/2019 - 00:41
            +1

            @[Deactivated]:

            I paid off my parents mortgage this year.
            …but because I was in a financially good spot.

            Heck, the only holidays they went on were paid by myself and family friends.

            I love my parents and I always will, but..

            Money is not everything.
            In any relationship, whether it's with your partner or parents or anyone else, there's a lot more to it than just money.

  • Duram on 15/08/2019 - 13:47
    -5

    I love the comments on here about ride or die with their parents, I come from a European background with similar cultural norms but I've shed them all :D. The way I see it, no one forced parents to have kids so we don't owe them shit in the same way I'm not going to hold it over my kids one day about how I paid for their preschool and expect them to take care of me.

  • macdaddyjordan on 15/08/2019 - 14:26

    If the tables were turned your parents would certainly help you and your wife get out of debt

    • samfisher5986 on 15/08/2019 - 16:03
      +2

      Any good parent knows that you can't keep bailing out your kids every time they make a mistake.

      But yes, there are some bad parents out there that do that and the kids suffer for it.

  • Tuftsdude on 15/08/2019 - 14:36
    +1

    Haven't read the other comments, but how about helping your dad get a job? Truck driver, warehouse work, anything. He should be able to repay his debt in 2 years or so if he works full time.

  • funnysht on 15/08/2019 - 15:06
    +1

    Difficult situation

    1)
    If their debt was honest- like got fired etc yes help them
    If it was just gambling etc - think twice before helping them

    Also

    2)
    Are they wanting to change and get a job/income?
    If so help them
    If not think twice before helping them.

    • [Deactivated] on 16/08/2019 - 10:36

      This sums it up^

      Don't go into this thinking you owe your parents just because they raised you.
      That was their choice.

      Go into this thinking about whats best given what the money was spent on.
      Was it just wasted on stuff they didn't need or was it spent on trying to get by?

      Are they looking for work or are they just leeching off you?
      How do they not have a combined super of at least 40k that they can use to pay the debt off?

  • JimB on 15/08/2019 - 15:07
    +2

    I feel sorry for your wife.

    Anyway. I'd contact each lender and advise them you will cancel the credit cards. Tell them you will pay them the full balance in installments but at 0% interest.

    If they don't agree, they won't be paid another dollar and request the lender bankrupts them. It's not like your parents have anything to lose.

    Good luck.

    End of the day $40k isn't that much but I wouldn't be paying it off for them.

    • SpotTheOzzie on 15/08/2019 - 15:12
      +1

      Plot twist: the wife and mum are both housewives, but the dad is unemployed.

      • JimB on 15/08/2019 - 15:23

        OP must have a well paying job.

  • tisRmac on 15/08/2019 - 17:36

    Perhaps speaking to a trained professional may be worth the time for you and your parents.
    https://www.moneysmart.gov.au/managing-your-money/managing-d…

  • trapper on 15/08/2019 - 18:03
    +1

    No amount of money you and your brother give them (short of paying off the whole debt) is going to help if they have no other real income.

    So if they have no income and no reasonable prospect of getting any real income any time soon, then that debt is never going away, the interest payments are never going away - the only solution here is obviously bankruptcy.

    One awesome benefit of bankruptcy is that they will find it much harder to get into debt again in the future.

  • No ONE on 15/08/2019 - 18:42

    Easy, declare bankrupt and reset after 7 years!

  • GourmetFoodie on 15/08/2019 - 19:00

    Your wife is a saint.

    Paying off the debt won't fix the problem. You need to get to the root cause. They also both need to get jobs. If they cant you need to figure out if you can buy them somewhere to live….and if you are up for that.

    You need to manage all their finances going forward unless they have capacity to learn from a financial counselor and change their ways. You may need to get power of attorney.

    The debt itself is actually pretty small, I wouldn't advise bankruptcy for such a small amount.

    Definitely cut up all credit cards immediately.

  • Black Brown Blue on 15/08/2019 - 19:13

    All of them including your brother is taking advantage of your niceness. Tell them to get their act together. I know it’s not going to be easy. Cancel credit cards and use debit card only. I wouldn’t pay the debt as they will have another debt year later. I would only pay the debt if the brother pays you rent every month instead of parents and all expenses have been cut.

  • spammingb on 15/08/2019 - 19:55

    What happened to your parents' house?

  • SnakeCasablanca on 15/08/2019 - 20:24
    +1

    As long as the parents aren't on your mortgage, do not pay off their debt. That will give them a clean bill of credit and by the sounds of it they will head out on the town and celebrate with Moet Champagne and Caviar all on afterpay!

    If they aren't on your mortgage then let the collections process run its course. Buying their furniture is not as silly as it sounds as you should keep the receipts so that they have no assets that can be sold to payout the debt.

    Once the collections runs its course they will not be able to borrow anymore and will have to live on what you provide them. Im assuming they will be cared for by you for the rest of your life. Pity they didnt respect you enough not to put you in that situation. Sounds like a tough living situation moving forward. Best of luck. You're a better man than I!

  • tryagain on 15/08/2019 - 20:25

    The other issue you also need to address is going forwards, considering the debt in isolation won't really fix anything.

  • tyvod on 15/08/2019 - 20:52
    +1

    Where is OP

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