Pay Dirt is Slate’s money advice column. Have a question? Send it to Athena and Elizabeth here. (It’s anonymous!)

Dear Pay Dirt,

My grandfather passed away about three years ago. Since then, my mother and her two sisters have been looking after my grandmother via an alternating arrangement where they take turns caring for her. To make things easier, my grandmother gave debit cards to her account to her three daughters so that they could pay for expenses as needed. And as my grandmother’s modest savings have been dwindling due to the years of spending it on her care, as well as my grandfather’s, they have decided to sell her home.

Recently, my mother happened to take a look at my grandmother’s account activity and saw that my aunt was ordering meals from restaurants and filling up her car’s gas tank by charging the card. This was a little iffy but I guess OK. However, my mom also noticed that she was spending hundreds of dollars for a psychic. When my mother and her other sister asked my aunt if she knew anything about that activity, she grew very defensive and started screaming that she wasn’t going to pay anything back. We are unsure to what extent my grandmother allowed her to use her account to pay for things, and we can’t just ask my grandmother because she will cover for her, as she always does.

What seemed like a smart decision about selling my grandparents’ house is now turning into a nightmare. My mother is very concerned that my aunt is seeing dollar signs and wants to use the money to get out of debt (my mother had previously wondered why my aunt, who is an extremely nostalgic person, wasn’t upset about selling the house). Mom is currently managing the sale of the house and is worried that she will be left holding the bill (as often happens with her family) for my grandmother’s care. I discussed the possibility with her of putting the money in some kind of trust where someone who has access to the account can withdraw money from it to reimburse medical expenses. However, it is unclear that my aunt will agree to this. It is also likely that my grandmother will simply gift much of it away to my aunt, without thinking about her own long-term care (she is also used to my mother having to come in and save the day). What should we do?

—Concerned Grandson

Dear Concerned Grandson,

I think you need to have a family meeting with Grandma about your aunt. But first, you’ll need to do some research. Start by estimating how much money your grandma will pocket from the sale of her house. Next, your mom or the aunt who’s financially responsible needs to log into your grandmother’s bank accounts, download the past several months of transactions, and figure out how much was truly spent on her care—think utilities, a home health care aid, food, transportation, medication, and miscellaneous expenses. Then add what the costs will be for your grandmother’s new living expenses, whether it’s a senior living community, a rent-subsidized apartment, or another option. Using these numbers, you can calculate your grandmother’s future monthly expenses and how long that budget will be sustainable. Finally, go over the bank statements with a fine-tooth comb and highlight all of your aunt’s unnecessary spending.

One you have these numbers, your mom and aunt should have a conversation with Grandma to go over how much she will have for her care and then how much her care costs, as well as what her aunt is spending. Show her how long her money will last if everything goes according to plan, then how long her money will last if you factor in your irresponsible aunt’s spending. Your mother needs to make it clear that she cannot continue to save the day, as it is affecting her own financial future.

The other factor here is a legal one. Unless I am unclear about something, your aunt does not have claim to your grandparents’ house or your grandmother’s care, unless otherwise stated in a living will or trust. But it might be wise to speak with an estate lawyer about options for limiting her ability to interfere. (A pooled special needs trust might be one such option.) But if your grandmother isn’t interested, your hands may be tied, and your mother will need to figure out what her financial boundaries are with her own financial planner. Good luck.

Dear Pay Dirt,

I am one of countless millennials swimming in credit card and student loan debt. Add a spouse who is unable to work due to COVID, and things are super tight. I have been able to make a tiny amount of progress due to my loan payments being on pause, but with unemployment ending and the repayments starting again soon, it’s getting scary. Almost my entire paycheck goes to debt payments (the $100 to $150 left each week or so goes to food, diapers, and essentials), as does my spouse’s (mainly mortgage and utilities, with any surplus for food). We know where our money is going—to banks and other lenders—but do not see a way out of this crushing cycle. Is bankruptcy a good option? We are skating by on money from family (for which we are so incredibly grateful) when we get medical bills (I have chronic illness but can work full time, and our child is special needs), but that is not sustainable in the long run. We’ve taken to buying one lottery ticket a month ($2) as a Hail Mary attempt. What can we do to turn things around?

—Bleeding Turnip

Dear Bleeding Turnip,

First of all, you are not alone. More than half of Americans are one paycheck away from being homeless, and $150 a week for essentials would also be a stretch for anybody, let alone having to afford diapers on that. Finding a higher-paying job is generally a worthwhile goal, but I realize that’s often easier said than done. And I do not recommend bankruptcy as a first option but as a last resort. It’s expensive, it’s time-consuming, and it’s usually not worth it. (Student loans are notoriously difficult to discharge in bankruptcy.)

I think your best bet would be to look for ways to reduce your monthly debt payments. A good place to start would be researching options for consolidating your student loans. If they are government-issued, you can qualify for an income-driven repayment plan, which might provide relief. Even if you were to consolidate your student loans under a private lender, your payment could still be a lot less than what you’re paying now and provide financial relief.

Also worth your time: Calling and explaining your situation to your credit card companies and asking what options are available. These companies want their money, so they’re often willing to work with you. Be ready to share what you can and can’t pay per month, and when you can revisit a time to adjust your monthly payment. Ask about a lower interest rate, which will help you get ahead on the principal. You can also call hospitals and doctor’s offices to try to negotiate down your medical bills.

For your son’s ongoing medical expenses, I recommend a call or visit to your local  disability services office. Both state and national programs may be able to help you with your son’s ongoing costs and care. I’m rooting for you and your family.

Dear Pay Dirt,

I am someone who grew up with a lot of financial trauma. My parents lost their jobs, our house, and any security we had in the 2008 crash. Combine that with my parents’ physical and mental health issues that kept my family spinning financially for the next several years, and I have so much fear and panic around money—having enough money, having emergency money, saving for the future, etc. I’m now 25 and just started a Ph.D. program, taking a significant pay cut ($50,000 to $15,000) in hopes of better earnings in the future. I know that I am so lucky to have no student loan debt thanks to generous scholarships. I also have $15,000 in savings and another $15,000 in retirement. Yet I am constantly stressed about money and what I do and don’t know about it. I have no idea what I should be doing with my money, if I’m in an OK position financially, and what I should do to proactively plan for my future. Financial planner? Stock market? Side hustles? Other than therapy (check), what on earth should I do for the next five years when I’ll be making almost nothing?

—My Parents Can’t Teach Me About Money

Dear Parents Can’t Teach Me About Money,

Financial trauma is a very real thing. It can stem from just one big event or crisis or from consistent micro-stressors. Every time you are hit with a micro-stressor, your body will respond with a fight-or-flight mentality. And if you have repeated stressors without giving your body a chance to calm down, you can be stuck in a permanent state of hyperarousal, which leads to PTSD. When you are seeking therapy to help with trauma, it’s important to acknowledge where you are and focus on build healthy habits (rather than just on why you feel the way you do). A therapist who uses cognitive behavior therapy is a great tool to have in your toolbox when recovering from trauma. And these healthy habits can include tracking your spending and staying within your budget, as well as learning new financial terms and strategies via one of the many accessible financial books. I’d also see if your campus has any financial counseling resources available to students.

In addition, if it’s helpful, you can sketch out a plan in case of an emergency. For example, if you were to lose your current housing, what would you do? If you couldn’t pay a bill, what would you do? (Though it seems to me like you have a healthy savings you could draw on in these situations!) And if you have the time and it would help relieve your anxiety, you could look for a side hustle. You’ve got this.

Dear Pay Dirt,

I was happy to be able to purchase a lovely century-plus-old home right as COVID lockdowns started. The real estate agent remarked, “The seller never agrees to fix everything on the list, yet yours did!” and I was happy to get a really low interest rate. I’m making an extra payment every year and will have it paid off about when I’m ready to retire in my early 60s. That said, my house will soon need some work—new roof and gutters, replace the cast iron pipes. I doubt I’ll have much equity, nor do I want to get rid of my low rate. I think a personal loan is the way to go. Am I crazy?

—They Didn’t Cover This in High School

Dear High School,

Congratulations on your new home! There are a few ways to finance your home repairs, and you are right to get them done before they cause major issues. But I think a personal loan might be your last resort.

Can you try to do one major repair at a time? For instance, do the roof now, then the pipes when that’s paid off, and so on? Some contractors offer in-house financing, so that may be an option if a roof is the first thing you’d like to replace. Or, since you have a low interest rate on your mortgage, could you put that extra payment toward repairs? You could also try to apply for a FHA-Title 1 loans, depending on your level of equity, or a home equity line of credit if you have more equity than expected. If none of those options are feasible or sufficient, you could take out a personal loan at a local credit union, but the interest rate on personal loans can be quite high—think 9 percent interest and above. Decide which repair is most urgent, then research how to finance it with the lowest interest rate possible.


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