Author Topic: How to talk to Mom about her spending habits  (Read 4182 times)

zombiehunter

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How to talk to Mom about her spending habits
« on: June 27, 2016, 01:26:03 PM »
I had a bit of a shock this weekend when logged in my bank online.  Due to being added as an Authorized User on my mom's Chase card (so she could get a point bonus), her credit card is now visible when I login -- so I guess it was snooping, which I feel bad about (I didn't log out and tell her right away), and leaves me conflicted as to how to broach the topic. 

But what I really feel terrible about is the state of her finances -- I knew that she had soft spot for shopping and generally lives a considerably anti-Mustachian/typical consumerist lifestyle, but the magnitude really threw me off.  I'm also feeling bad about encouraging her to get this credit card -- I've been in the churning hobby for the last year and half, and have racked up enough points and trips for a two week honeymoon in Hawaii and a round the world trip next year to Asia and Europe.  But the most absolute rule in credit card churning is don't carry a balance!

To give a few highlights, over the last 4 credit card statements:
  • ~$75 in interest charges per month.  The balance has stayed at about $5,000 each month, and monthly payments are generally treading water (e.g. not paying it down) + one $25 late fee.  It works out to ~$950 annually
  • She's been going to the salon monthly for hair cuts/color/highlights/pedicure/massage.  $200-400 per month... the last 4 months annualized works out to $4,300 annually!   
  • Various retail shopping expenses, which I'm going to ignore, as I'm trying to walk a fine line between bossing around my own mom and trying to give her some financial guidance, so I'm going to focus only on the interest/late fees/running balance and extravagant spa expenses.
  • Whole Foods weekly grocery shopping over $100 for one person
  • $190 per month in internet + cable TV

For some additional background -- about 18 months ago, she sold her house and moved, and pocketed a nice return on the house, I believe about $75k, which was tax free due to having lived there more than 2 years.  At that time, I told her to either invest that money, or better yet, max out all tax-advantaged retirement accounts and use a portion of the cash proceeds to live off of, while her salary was diverted to retirement accounts.  She is approaching the age of a typical "early" retirement, but I believe has less than $300k-500k in retirement savings, meaning she will likely have to work until ~70 years old.

After selling the house, she rented an apartment that actually cost more per month than the previous mortgage + insurance + property taxes.  And she upgraded her old, paid-off car and bought not just a new car, but a new $30k car with financing, despite the fact that there was a similar model with zero percent financing.  At the time, I gave her an Amazon Fire stick with my Netflix login included, so that she could cut cable.  But because the internet + cable combo was the same price as just internet for a year, she went with that.  And of course, a year later, the price has jumped to $190 per month for internet and cable TV (which has not been cut).  Finally, she spends more on groceries at Whole Foods for one person than my wife and I do for the two of us!

She did take some of my advice and increased her retirement contributions and employee stock plans, but did it a bit too much.  With the expensive apartment + expensive car payment + excessive shopping, it sounds like she doesn't have enough to cover monthly expenses, hence the credit card balance.  Taking half my advice (save more) without the other half (cut costs) turned it into bad advice. 

I've been on my own MMM journey, learning to save and relinquish my previous dalliance into the consumerist lifestyle.  I've found it liberating and enlightening.  Wanting to stay true to this, for a birthday present this year I specifically told her that I didn't want any gifts purchased at retail, but would instead prefer a scrap-book album of old family photos, and for her to share the cost with us for an airplane ticket for my wife and I to come visit family. 

This was of course before I knew she was living in debt.  Now I would feel bad about asking for her portion of the $300 airfare, while I'm sitting here without debt and saving as much money as possible, so I want to forego that gift and tell her to use it to pay down the credit card.  But at the same time, I don't want to save her some money just so it can be used for spa treatments.  And I'm also feeling a bit selfish because part of my concern here is that at some point this spending will catch up to her when she's no longer able to work, and the cost of elderly-care will fall on me, while I've been budgeting and saving for FIRE.

Any advice on how to have a conversation about this? The whole thing is admittedly messy and messed up, not the least of all because I inadvertently had access to her account, but also because she's my mom.  But to me it seems like a dozen or more financial decisions, any one of which would be bad, but taken in the aggregate combine to create a dumpster-fire debt emergency. 

Thanks for any advice. 
« Last Edit: June 27, 2016, 01:33:28 PM by zombiehunter »

Mother Fussbudget

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Re: How to talk to Mom about her spending habits
« Reply #1 on: June 27, 2016, 01:37:20 PM »
Very carefully.  Your mom is an adult, and can handle her own finances.  And nothing can put a damper on family relationships than talk of money.

If you absolutely can not avoid the subject... even then you should NOT, NOT, NOT talk about your mom's spending habits. 
Instead talk about how YOU'VE changed YOUR spending habits, and how well that's working.

Thank your mom for helping you get this card.  Tell her you were surprised by the HIGH INTEREST RATE, but that it should be ok as you plan to pay off the balance every month, so you NEVER incur an interest fee.  Talk about YOUR free vacation to Hawaii purchased via points.  Talk about how YOU'RE careful to avoid frivolous spending so you never find yourself paying off a $25 meal with $500 (with interest) over 5 years.

Frankies Girl

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Re: How to talk to Mom about her spending habits
« Reply #2 on: June 27, 2016, 01:43:20 PM »
First, I'd only bring it up if she's already told you she wants your help. Because being linked on her credit card with the unintended consequences of being able to see her spending habits is a serious privacy invasion and I'd be loathe to bring this up unless I was very, very sure that she was aware of this and welcomed your advice.

If this is known and she is good with discussing money, I'd probably tell her ASAP that you didn't realize that you'd be able to see her credit card info in your own accounts, and that you're very sorry about that. And then tell her that you looked, and you're very worried about her spending and ask her if you can help her brainstorm on cutting costs down, as with her current spending rate she's racking up lots of interest charges and debt. Tell her you love her and worry about her and her long range comfort and security, and just want to help. Do NOT lecture her, and be very careful about how you choose to discuss this as it is a prickly subject and even certain innocent turns of the phrase can be taken badly if she's inclined to do so.

But if she is not interested in your help in cost cutting, I'd just butt out and remove yourself as an authorized signer to remove the temptation to monitor her spending. She's a grown woman and if she blows all of her money, she'll technically still have social security to fall back on and you're not obligated to supply further funds yourself unless you really want to.

zombiehunter

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Re: How to talk to Mom about her spending habits
« Reply #3 on: June 27, 2016, 01:58:27 PM »
Thank, both.  You're both absolutely right that this is a very sensitive subject on its own, plus there's the privacy invasion that allowed me to learn about this.  (FYI, this is her card, I was only added as an AU so that she could get extra points).   

I'm fairly stuck between "I shouldn't have looked anyways" and "I can't lecture my own mom about finances" and feeling terrible about the situation/wanting to help. 

I think my plan will be to let her know that I have access to the account online, and ask if she wants me removed.  I'll say that I saw she's carrying a balance and ask if she wants to talk about it/talk together about ways to get it paid off.  I'll also tell her to keep the $300 birthday cash for our tickets, as I don't want gifts while she's in debt.  I won't bring up any particular expenses or what I consider to be ridiculous habits.  Hopefully we'll be able to have a productive conversation. 

mozar

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Re: How to talk to Mom about her spending habits
« Reply #4 on: June 27, 2016, 02:04:43 PM »
It sounds like she is a little bit willing to take advice so I would keep having discussions. If she has 300k and is still working full time, she's not doing so bad. My mom works part time and has 300k, which she is also taking distributions from and living off of.

zombiehunter

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Re: How to talk to Mom about her spending habits
« Reply #5 on: June 27, 2016, 02:08:10 PM »
It sounds like she is a little bit willing to take advice so I would keep having discussions. If she has 300k and is still working full time, she's not doing so bad. My mom works part time and has 300k, which she is also taking distributions from and living off of.
That's true.  From a mustachian POV, it's a flaming debt emergency.  Form your regular consumer POV, it's "treating yourself" plus having a decent 401k. 

v8rx7guy

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Re: How to talk to Mom about her spending habits
« Reply #6 on: June 27, 2016, 02:09:14 PM »
I'll say that I saw she's carrying a balance and ask if she wants to talk about it/talk together about ways to get it paid off. 

I wouldn't even do this.  Reading this forum and subscribing to the MMM lifestyle makes a lot of people feel like they need to "fix" their loved ones.  I don't think her lifestyle warrants an intervention, she is very "normal" with her spending habits... which I'll agree is sad, but that's the reality.

Kitsune

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Re: How to talk to Mom about her spending habits
« Reply #7 on: June 27, 2016, 02:17:13 PM »
I'll say that I saw she's carrying a balance and ask if she wants to talk about it/talk together about ways to get it paid off. 

I wouldn't even do this.  Reading this forum and subscribing to the MMM lifestyle makes a lot of people feel like they need to "fix" their loved ones.  I don't think her lifestyle warrants an intervention, she is very "normal" with her spending habits... which I'll agree is sad, but that's the reality.

This. Most people take very badly to being 'fixed'.

... That said, my in-laws have started hinting around at how, now that they're retired, they're SO BROKE... (ahem: we just built a house, have a kid, are pregnant with a second, and are straightening up our finances but are CERTAINLY not in a flush position ourselves, so like hell are we in a position to bail you out!!) But if you think that's coming your way, I'd suggest a second, separate (important! DO NOT CONFLATE THIS WITH SPENDING) conversation about what long-term plans are in place and what you can/can't give.

frugaliknowit

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Re: How to talk to Mom about her spending habits
« Reply #8 on: June 27, 2016, 02:50:32 PM »
In the future:  I suggest you not be an authorized signer on anyone's card.  As you can see now, whatever points your mom got are not worth it, right? 

zombiehunter

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Re: How to talk to Mom about her spending habits
« Reply #9 on: June 27, 2016, 04:01:29 PM »
In the future:  I suggest you not be an authorized signer on anyone's card.  As you can see now, whatever points your mom got are not worth it, right?

Very true!  Even the sign-up bonus, which was a juicy ~60k chase ultimate rewards, will be completely offset by the annual interest fees.  That's why credit card companies can offer such lucrative signup bonuses, because they know for every 1 person that gets the card and pays if off and reaps the rewards, there will be many others who get sold on the points and end up paying more in interest charges than the points are worth. 

Zamboni

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Re: How to talk to Mom about her spending habits
« Reply #10 on: June 27, 2016, 04:42:51 PM »
Do not bring it up. My advice is to call the credit card company and have yourself removed as an authorized user so you are not even tempted to "check again" online.

Mother Fussbudget

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Re: How to talk to Mom about her spending habits
« Reply #11 on: June 27, 2016, 05:36:35 PM »
Do not bring it up. My advice is to call the credit card company and have yourself removed as an authorized user so you are not even tempted to "check again" online.

This is what I would do in your situation.  Good luck.

LeRainDrop

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Re: How to talk to Mom about her spending habits
« Reply #12 on: June 27, 2016, 09:12:57 PM »
Do not bring it up. My advice is to call the credit card company and have yourself removed as an authorized user so you are not even tempted to "check again" online.

This is what I would do in your situation.  Good luck.

Agree.  Her spending habits are not your business -- you acknowledge that she probably did not intend for you to be able to review all her charges, and she has not asked for your help.  It really sucks to see someone you care about making (what you believe to be) poor decisions, but unless those decisions are directly harming you or imminently sending them down a very bad path, then I would recommend you stay out of it.  There could come a point where you need to intervene, but based on what you've posted here, you're not at that point yet.

ETA:  On further reflection, a more practical way I might handle the situation is this:  If you have a really good relationship with your mom, I'd tell her, "Mom, I feel really awkward telling you this because when you added me as an authorized user, you probably did not realize that I would then get access to see all your transactions when I log in.  As it turns out, they were automatically added and I couldn't help but notice that you are spending a lot of money each month -- so much that you're actually carrying a balance.  That makes me worry about how you're doing.  I know before we talked about you splitting the cost of my plane tickets, but now that I know this information, I would feel too guilty to have you pay for that cost for me.  I'd rather not take that money from you."
« Last Edit: June 27, 2016, 09:24:43 PM by LeRainDrop »

zombiehunter

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Re: How to talk to Mom about her spending habits
« Reply #13 on: June 28, 2016, 07:30:40 AM »
Do not bring it up. My advice is to call the credit card company and have yourself removed as an authorized user so you are not even tempted to "check again" online.

This is what I would do in your situation.  Good luck.

Agree.  Her spending habits are not your business -- you acknowledge that she probably did not intend for you to be able to review all her charges, and she has not asked for your help.  It really sucks to see someone you care about making (what you believe to be) poor decisions, but unless those decisions are directly harming you or imminently sending them down a very bad path, then I would recommend you stay out of it.  There could come a point where you need to intervene, but based on what you've posted here, you're not at that point yet.

ETA:  On further reflection, a more practical way I might handle the situation is this:  If you have a really good relationship with your mom, I'd tell her, "Mom, I feel really awkward telling you this because when you added me as an authorized user, you probably did not realize that I would then get access to see all your transactions when I log in.  As it turns out, they were automatically added and I couldn't help but notice that you are spending a lot of money each month -- so much that you're actually carrying a balance.  That makes me worry about how you're doing.  I know before we talked about you splitting the cost of my plane tickets, but now that I know this information, I would feel too guilty to have you pay for that cost for me.  I'd rather not take that money from you."

Good recommendation, thanks!

Choices

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Re: How to talk to Mom about her spending habits
« Reply #14 on: June 28, 2016, 08:37:26 AM »
Agreed. You can tell her that you inadvertently saw her statement, then ask if she wants to talk about finances. If she says no, then drop it. If she says yes, you can ask about basic things like a budget rather than confronting her on specific charges/expenditures.

There was also good advice above to talk about what works for you rather than what she's doing 'wrong.'

DeltaBond

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Re: How to talk to Mom about her spending habits
« Reply #15 on: June 28, 2016, 08:50:22 AM »
Agreed. You can tell her that you inadvertently saw her statement, then ask if she wants to talk about finances. If she says no, then drop it. If she says yes, you can ask about basic things like a budget rather than confronting her on specific charges/expenditures.

There was also good advice above to talk about what works for you rather than what she's doing 'wrong.'

+1 - this is a peaceful approach and will allow you to not feel like you're bottling something up.  She'll know that you know that she knows that you know... and at some point, maybe a conversation will happen.  Credit cards are a way of denial, and denial is hard when you know someone else is looking at your numbers.  Plant the seed, take yourself off as a signer, then move on and see if the plant grows.