Your child is a young adult. As a young adult, your child has incurred credit card debt due to overspending. It is natural for you, as a parent, to want to help your child get out of debt.
At the same time, you are worried that your child never learnt the lesson to curb unwise spending habits.
What can you do to help your child get out of debt, and to cultivate saving habit?
First of all, you can have a discussion with your child. Do not accuse your child of self-indulgence. Do not say “when I was your age”. Once you saythat, the discussion is effectively finished. Your child will never listen to your advice again.
You can ask your child for an action plan. Your child may have a plan to get out of debt within a year. In this case, you may decide to adopt a wait and see attitude. It is better for your child to learn from a bitter lesson.
If your child is too heavily in debt, you can offer to help clear part of the debt. Make sure that the offer is accepted willingly. Do not force your child to accept your good will. You are likely to hurt the dignity of your child.
Determine the amount of money needed to get out of debt. Determine the amount of money you can afford to give or loan. Even if you can afford to pay off the debt, do not do so. Leave some of the debt for your child to clear.
Youhave to pay directly to the creditors. Do not transfer the money to your child. You do not want to tempt your child to spend the money.
Offer some practical suggestions to help your child. For example, you can encourage your child to start a part time business to clear the debt. You can offer to help your child get an additional part time job.
Have regular discussion with your child about managing personal finance. Recommend your child to learn by reading books. Your child will respect the advice of experts more than your personal experience.
Do remember not to nag. Your child is likely to seek for advice when you do not resort to nagging.
Your child is a young adult. You have to treat your child as an adult. Talk to your child as if you are advising your friend or colleague.
Do forgive your child for overspending. Everyone is entitled to some mistakes, including your child. Your job as a parent is to help your child learnt the importance lessons in life, including wise use of money.
Scheng1 is a passionate blogger from Singapore. Rich in every sense reveals my deep desire in enjoying life, and be rich in every possible ways.