The staff of the Employee Assistance Program spend their workdays helping public employees find solutions to a variety of issues. On this page, members of the EAP staff and other contributors from a variety of disciplines and experience contribute short articles intended to shed light on some of the human dilemmas we all face.
Read this month's article below, or select an article from a list of previous submissions on a variety of topics.
May 2012
Love and money . . . what to do?
When I was asked to submit an article about lending money to a family member, I thought, “Now here’s an opportunity to get my butt in a sling.” You see, I’m not an expert on personal finances. I’m not a family counselor, or a debt counselor. I’m simply a guy who has reached the age of 60, and hopes to live for another two or three decades. Moneywise, I’ve learned far more from mistakes than successes. But in reality, that’s pretty much how life works.
A little background so you’ll understand where I’m coming from
I’m a father, a husband, and a grandfather. I’m also a brother and a son. I’m part of a family, a large and complex one, and I love them all.
Before I married, I was a soldier and experienced a war. I came home. I learned the construction trade and, for a time, I owned a construction company. Later, I opted to get a college education. Financially, I’ve experienced good times and times that weren’t so good. Eventually, I found a career with Washington State. I’ve not become rich, but those of us who choose to work in the public sector don’t expect that.
As a son, I was taught that anything was possible - if you were willing to work for it. That’s the American Dream. I’ve only to look to my parents, both hard workers and children of the Depression, to recognize that the “Dream” is an over-simplification. Their hard work put a roof over our heads and kept us fed all the way through high school. My parents got us all to adulthood without experiencing hunger. They also made sure we attended school, and passed along that lodestone of their generation, The Work Ethic.
None of my siblings ever asked me for anything. I’ve always been welcome in their homes and they in mine. We’ve all raised families and are watching another generation, our grandchildren, arrive.
Does being a member of a family come with certain obligations?
It’s my belief, and the government’s as well, that I need to provide for my children until they’ve completed high school or turned 18. During that time, it’s my responsibility to teach them the value of hard work, setting goals, and following through. Children should transition to the adult world with a clear idea of how it operates.
Some of my kids wanted to attend college, and I provided as much assistance as I could. I asked them to research funding opportunities, apply for scholarships, and to work summers. If I were the parent of a young child today, I would invest in the GET program to help with college costs. A college education is expensive, but it pays dividends in earning power and provides a broader sense of our world.
Did I succeed in my family-raising expectations? In retrospect, I would have sat down with my kids and discussed the value of good credit, the dangers behind credit cards, and demonstrated how to develop a personal budget. I’ve noticed that, even though such advice triggers the eye-rolling response in teenagers, it often provides a reference point that will be called on when it’s needed. I sometimes imagine one of my kids drooling over a top-of-the-line car or computer, when suddenly the sleep-inducing drone of my lecture voice begins this irritating mantra inside his or her head... “How will this fit into your monthly budget, will insurance go up, and did you put 10 percent into savings, blah, blah.”
During my life, I’ve had to make many decisions concerning money. Some were difficult; some were obvious. The most difficult of those decisions concerned family.
Some simple observations
1. Don’t lend what you cannot afford to give. As for loaning money to family members, I look at it this way: don’t lend if you can’t afford to give. If you’re dealing with your children, this is a teaching opportunity as well as supportive gesture. Look to build strong, independent behavior, nurture pride in accomplishment, and appreciation for the art of saving.
2. Don’t risk the welfare of your family. Sometimes, as much as you’d like to help, it’s just not in the cards. If you can’t spare the money or feel that the request is out of line, be honest about it - with yourself and the family member. This is your family. You know them well. Listen to your gut as well as your heart.
3. Just because you can afford it doesn’t mean it’s the right thing to do. Sometimes, bailing a family member out when they’ve made a financial mistake sends the wrong message. Have them research their alternatives. Sometimes, a restructured payment plan is the better option. Sometimes, they just need to let something go. Learning how to recover and move on is a valuable lesson.
4. On co-signing for business or house loans. One of my kids asked me to co-sign to buy a house. There were a spouse and grandkids involved, and I really wanted to help out. My wife and I discussed it at great length and decided that the timing was wrong. We weren’t in a position where we could pick up a payment or two if they ran into financial trouble. It seemed too risky to take a chance on losing our house. It hurt to make that decision because that child had never asked for a loan before, and buying a house was a good move for them. I did use my connections in the local community to help them find a way to finance but, in the end, they worked it out for themselves. They felt really good that they’d made it happen on their own. Made me proud, too.
5. If times are tough, and you need to pitch in. Sometimes, bad things happen and we need to pull together as a family. Remember observation 2, and consider your options before making a decision. Money isn’t always the answer. The family dynamic is different with each of my kids. I’ve had one of my adult children and her family move in with me while they were trying to save some money to get a house. We were an overcrowded, tense bunch for about three weeks. If that kind of situation happens again, I’ll help them pay rent if I can afford it. Less stress, easier on relationships, and the savings on power, cable, and food costs offsets a chunk of the rent.
6. Love thyself, too. As I grow older and my career winds down, I find myself thinking of the things I haven’t done, places I’ve not seen. Some of these will never happen, and I’m ok with that. Some, I’m going to do. I’ll need to spend some money on me and my wife to make it happen. And that’s ok, too.
All this in a nutshell
It takes a large portion of money to cover a small portion of common sense. That goes for the lender and the borrower.
Dennis Gustafson
Department of Enterprise Services