So, how far would you go to help out?

[Brown and Boris]

I have had my mind focussed these past few days by the redundancy of my sister in law at the time my brother was asked to take a 10% cut in wages or face redundancies at his place.

It got me thinking about how far I would really go to help them out if, for example, they struggle to pay the mortage and are threatened with having the house, (which they have worked their bks off to get and its not exactly a mansion), repossessed. I think I would find it impossible to stand by and let that happen while I had money in the bank, but would I, for example be prepared to use my own mortgage capacity so that in effect I risked my home for them if this lot really goes pear shaped? Would I be prepared to use the money I have as my nest egg for old age to make sure they didn't get repossessed now? I am on the downward road to retirement in the next 5-10 years, and they are older so the chances of them being able to refill my pension pot are small even if they do get new jobs.

So, the original question; how far would you go for family or close friends to help out?

[Jasandjules]

I'd happily have them move into a spare room for a year whilst they sorted themselves out. I have lent (read, given) money to family before...

[theaxe]

Personally I'd never mix family and money unless you're willing to never see it again.

If they lose their home you can be there with a sensitive ear and a place to stay in the short term. I don't think anyone could expect any more from you.

[rich1231]

That you have to even ask the question gives some insight into your mindset.

Families and friends help each other.

[scotal]

rich1231 said:

That you have to even ask the question gives some insight into your mindset.

Families and friends help each other.

Very noble.... but how many threads has there been on here that kick off with

"I lent my mate/brother/sister/folks money and now i can't get it back"

To be followed ad infinitum by "What the fk did you do that for?" type comments.

[Rude-boy]

scotal said:

rich1231 said:

That you have to even ask the question gives some insight into your mindset.

Families and friends help each other.

Very noble.... but how many threads has there been on here that kick off with

"I lent my mate/brother/sister/folks money and now i can't get it back"

To be followed ad infinitum by "What the fk did you do that for?" type comments.

100% Agree. You do what is right. And in doing so you have to make sure that that is also what it right by you.

If you don't make sure number one is at least okay how the hell are you going to be any good helping out others?

[MitchT]

I've never been able to buy a house of my own owing to firstly, an amazingly tiny wage, and then later, house prices having accelerated much faster than my wage, so technically I'm even worse off than someone who has had a home but is at risk of losing it. Has anyone stepped-up with cash to help me? No. So would I feel inclined to do the same for anyone else? Have a guess!

[Mattygooner]

Blood is thicker than water!

Custard is thicker than blood, give them a apple crumble...

[deckster]

rich1231 said:

That you have to even ask the question gives some insight into your mindset.

Families and friends help each other.

The helping was a given. The, quite reasonable, question was by how much.

It's a complex question and there's no correct answer. I think the main factors I'd take into account are:

- what is the impact of not helping? Are they just going to cut down on the vino for a bit, or are they going to be homeless?
- how much of it is their fault? Have they borrowed up to the hilt without any forward planning or have they just had a string of bad luck?
- how much difference is it going to make to your current and future plans? Might you have to settle for a 530 rather than a 535, put back retirement for a couple of years, or risk your house?

Once you balanced up all that you need to decide what you feel comfortable with. I don't envy you the situation at all.

[Fittster]

theaxe said:

Personally I'd never mix family and money unless you're willing to never see it again.

I suppose it comes down to what would your rather see again, the money or the relative.

[jeff m]

I would help as much as I could.
But you have to consider that you are not in the money lending business and therefore your criteria for lending money are emotional.

Doing the "right thing" however noble could jeopodise your future, including your marriage. I assume you are married.

Do they have a plan?
Or more to the point, do you have a plan with regard to your own finances.

One get out could be to give them 10% of what you would have loaned them.

[FarleyRusk]

Always lend on the basis that you're not going to get it back. Therefore is should only ever lend what you can afford to lose. In years gone by my brother has helped me out when times were hard and I've done the same for him. The amounts involved were in thousands and I wouldn't hesitate to do the same again

[paulmurr]

It depends, if my brother was in financial difficulty not of his own making then yes, I would loan him cash to help out. If he had borrowed 5 times his salary to buy a house then set about his credit cards running up £50k of debt on LCD tellys, track suits and coke then i'd tell him to sling his hook.

But that's just my opinion

[digger_R]

Fittster said:

theaxe said:

Personally I'd never mix family and money unless you're willing to never see it again.

I suppose it comes down to what would your rather see again, the money or the relative.

Will they die if you don't give them the money?

[isee]

Depends on how close you are IMHO.
I have bought my parents a house abroad (where they moved to)
Paying for it to be extended and repaired at the moment
and since their house in UK is in negative equity and it doesn't look like they will be able to keep up the repayments for much longer due to their business not doing too well, it looks like I will be paying their mortgage for them, out of the savings I had to get my own mortgage...
It hurts financially and it doesn't look like I will be seeing all that cash back any time soon or possibly at all, but they are my parents and I will do everything I can do "repay" them for all the sacrifices they made for me when I was growing up.

Having said that, I probably wouldn't go this far for my sibling and definitely not for any of my extended family.

Also at the end of the day you can't take your money to the grave and a human being is a survivor by nature, no matter how bad the financial situation, I doubt I would perish if I was stripped of all my possessions and savings. I'd just have to start again.

[drivin_me_nuts]

Helping families is uncondition. BUT there is a balance between helping out and being taken advantage of. To know your tipping point is important.

[Quaint]

Brown and Boris said:

So, the original question; how far would you go for family or close friends to help out?

I think it depends on the people concerned. I'd be inclined to do whatever I could to help my parents or my sister out, on the basis that they have done the same to me in the past. As a side-order of realism, though, I think the folks who say "only lend to family and friends on the assumption you'll never see it again" are correct, TBH. Anyone with a shred of decency will pay back as soon as they can, and if there's no history of fecklessness you're could be on a winner IMO.

I've helped friends out a few times in the past, on an explicit "just pay it back when you can" basis. Been burned twice (in neither case for much), and paid back many more times. For me personally, there's a dimension of simply wanting to do the decent thing, which I rationalise as paying forward on some karmic level; but each to their own, I guess.

Finally, as others have pointed out, there are no pockets in a shroud.

[just me]

Give them a place to stay, if they need it, and offer lots of moral support. This is better than helping them financially. If you can help them financially, only offer it if it will change their condition. Don't give money so they can simply stay in their house for a few more months ie. don't throw good money after bad.

Long term, if they don't recover, you will want to be in a position to help. If you sacrifice your own future, BOTH of you will be on the street with no one to turn to for help. Better to protect your own nest egg so that you have it to share. Whatever you do, do not sacrifice your retirement for the following three reasons:
It will encourage them to remain financially independent NOW
It will enable you to help them in the future
It will protect your future

You should only offer the help you are capable of giving. Don't look on your retirement savings as something you have access to. Not until retirement.

Edited by just me on Wednesday 18th March 15:10

[Simond001]

I disagree with most of the above.

if they are fairly decent poeple and this is an unforseen situation they will turn it around.

I'd happily pay the mortgage on my sisters house if her or hubby lost their job. Its the decent thing to do.

I may change it to IO for the immediate future, but at leats they keep their home, which if sold by the mortgage company will leave them with tens of thousands of debts.

[Brown and Boris]

Brown and Boris said:

I have had my mind focussed these past few days by the redundancy of my sister in law at the time my brother was asked to take a 10% cut in wages or face redundancies at his place.

It got me thinking about how far I would really go to help them out if, for example, they struggle to pay the mortage and are threatened with having the house, (which they have worked their bks off to get and its not exactly a mansion), repossessed. I think I would find it impossible to stand by and let that happen while I had money in the bank, but would I, for example be prepared to use my own mortgage capacity so that in effect I risked my home for them if this lot really goes pear shaped? Would I be prepared to use the money I have as my nest egg for old age to make sure they didn't get repossessed now? I am on the downward road to retirement in the next 5-10 years, and they are older so the chances of them being able to refill my pension pot are small even if they do get new jobs.

So, the original question; how far would you go for family or close friends to help out?

I wasn't putting it directly into my partricular circumstances, I was just intersted in how far people would go themselves in their circumstances if it was their brother/parents/son, not necessarily in my circs .