I have gotten my self into a financial pickle which I fully acknowledge is of my own making. I’m not in a position to get a home equity loan or borrow unsecured from a bank.
I was wailing to one of my sisters, who suggested that I ask my mom to loan me the money. She is the execturix of my mother's will and has some idea of how much money she has. Her idea is that, if my mom agrees, if I haven't paid it all back by the time my mom dies, whatever is left will be taken out of my share of the inheritance.
I have 4 other sibs who have, from time to time, borrowed money from my folks. I have no idea how much or how often, I figure it's Mom's (and my late Dad's) money and none of my business.
Assuming my mom agrees to this (no guarentee that she will), I fully plan to put everything in writing and make her charge me interest. Do I have an obligation to tell my other sibs that I'm borrowing from her? The only way it would affect them is if I wind up owing money after mom dies and I owe more than my portion of the estate, in which case I would owe it to my sibs.
The only reason I would want to keep it quiet is that I am really embarrased that I have gotten myself into this situation. But, since it may affect them at some point, do I have an obligation to tell them about borrowing the money, if MOm lends it to me?
A few years ago, I wrecked my old, minimally-insured car in an accident. I had to get another car, and talked with my mom about loaning me money to buy the car up-front (so I could pay her back interest-free as opposed to a bank). She loaned me $5,000 and I payed her back in installments of about $500 a month, over a year.
At the time, I was working three part time jobs which only netted me $10,000 a year, and going to school full time. If the need is dire, it shouldn’t matter whether they know or not, in my opinion.
I see it as your mother’s obligation to keep her will up to date. If something happened and you did owe your siblings money, you could tell them at that point. But I don’t see any ethical obligation on your part to tell them now since it’s not their money yet!
The only person with any conceivable “need to know” is the sister who suggested you ask mom for a loan. If your loan exceeds your portion of the estate, then you would just offer to pay back the sibs instead of mom. To be honest, if you put it all in writing, even sis doesn’t need to know, she’ll find out when going over the documents as executor.
It’s your mom’s money, to do with as she pleases, your siblings don’t have any inherent right to stick their noses in her dealings with you or anybody else, unless she’s unable to handle finances on her own.
My mother gave my brother money to get him over a tight period, and she has changed her will so that he gets that amount less than the other five of us get. She contacted each of us, to make sure that we were OK with that plan.
My response was more or less: “It is your money. I have no legal or moral claim to it. You can do with it as you please, including giving some of it to my brother - or to anyone else, for that matter. If, when you are gone (which I hope won’t happen for a VERY long time), I receive anything, that it a bonus that I will appreciate without any carping about how much it might have been ‘if only’.”
I gather that my other siblings said more or less the same thing.
I would say NO NO NO. My sibs are cool, but one of them has this nasty habit of needing to get the lion’s share of everything, so he would naturally hit Ma up for MORE than I did. YMMV.
HELL NO. Think of your poor Mom! Not only are you about to hit her up for an amount you think may exceed 1/5 of her assets, but she’s about to find out that you’re already thinking of her money as “an estate” and are parcelling it out in your mind. Plus you aren’t feeling particularly obligated to pay the money back in her lifetime.
I don’t see any reason for you to tell them now if it would make you uncomfortable. It’s a deal between you and your mom. It has no bearing on them whatsoever unless you still owe when she dies. Even then I’m not really inclined to say that you would owe your siblings money beyond forfeiting your portion of the estate (if you so chose).
It’s your Mother’s money. Until she shuffles loose the mortal coil she, and she alone, gets to decide what to do with it. It irks me a little when the offsring think of their living parent’s money as their own.
From the sibling’s point of view…I don’t think you should tell them.
My sister told me that Mom and Dad “loaned” her a bunch of money (somewhere near $8000+) about 2 years ago. She also mentioned that she’s not paying it back right now as funds are still pretty tight. She also said something about taking it our her inheirtance. I’m not sure if she was joking or not.
I wish I didn’t know this. I have never asked my folks for money, but knowing that my sister “owes” all this money to my folks, but isn’t actively paying it off really bothers me. Especially when I see her spending money that I think she should be using to pay back my parents. You see, I know it really isn’t any of my business how she spends her money, but because she told me about borrowing money from our folks, I get frustrated with her. Not because I think she’s spending my inheritance, but because I think she’s taking advantage of my parents generosity.
I don’t think it’s any of your sibs business. For instance, I know that my parents helped my brother out when he was attending university sending him $$ and care packages on a regular basis. However, I don’t know exact amounts, and I sure as heck wouldn’t want to - that’s between him and my parents.
Further, my parents have given me $$ in the past when I needed it, and my brother doesn’t know any of those amounts either.
I don’t think you’re under any obligation, whatsoever.
Let me toss in on the other side. While financially there’s no reason for others to be notified of borrowing issues between two adults there may well be family issues that mean they should know.
My brother-in-law has, we discovered, borrowed money from my mother-in-law. Something substantial like $20K or so for a house downpayment. And he’s borrowed before and not paid it back.
Now, he’s a good guy. Makes good money and is a fine professional and great uncle. But he had a messy divorce (his wife wigged out when she turned thirty and left him to date someone who was 22)(chick with issues, that one) and that sort of knocked him off plan. So no hard feelings there.
But my mother-in-law keeps bringing it up to us. To ‘make sure we know’ so that the inheritance can balance out. Lady Chance is her executor and actually couldn’t give a damn about whether the estate ‘balances’ properly. I, for one, have told my M-i-L to blow it on wine and Chippendale’s dancers but she’s stuck on making sure we know what he’s borrowed and whether he’s paid it back.
Urgh.
So it ain’t all about the dollars and cents issues.
Actually, I do feel obligated to to pay the money back in her lifetime, but I am just trying to think of every possible contingency. She is 79 years old and in good health. She still travels, sometimes by herself. She may outlive me. But if she doesn't, and I still owe her money, I don't think it's fair for me just to say, "Oh, well, guess I don't have to finish paying". That's the only reason I'm thinking about "the estate".
follow the “Don’t Ask, Don’t Tell,” policy— if they don’t ask, you don’t have to tell… not that you have to even if they do ask, it’s none of their business.
My parents loaned money to all their children, and we all paid it back, with interest.
My advice, it’s between you and your mother. But keep scrupulous records, and if you’re mother should die before you pay everything back, let your sister the executrix know how much you still owe.
I’m not trying to accuse you of anything but I’m trying to get you to realize how this is going to sound and feel to your mother. Whatever your motivations. If she dies before you can pay the money back then nothing’s stopping you from repaying the “estate” then. But you don’t have to discuss that contingency with everyone beforehand.
My mom loaned me a chunk of cash and she told me to keep it to myself. I expect my brother probably knows since he does her taxes and he’s her executor. It’s a given that should she die before I pay it back, the remainder comes out of my share of her estate. I know for a fact that I won’t wind up owing any to my sibs - my share of the house would more than cover the loan.
It depends on the type of family you have. If your family is going to see this as a secret you should have told them but didn’t, you are better off telling them. For example, in my family, we tend to tell one another pretty much everything. Every once in a while my mom will offer to buy me something or loan me money and says she won’t tell anyone. I know her, though, and I know she will tell, and it will look like I was trying to pull a fast one.
On the other hand, as you can see up thread, some families don’t discuss these things. If your family doesn’t, then you are fine not telling and just putting everything in writing.