My sisters debts

katiepkh

Hello everyone,

I have browsed this forum for years but have never actually needed to set up my own account until now.
Yesterday I returned from a lovely week away in Devon with my husband, sister and brother in Law. We try to get away together for a week every summer as it gives us the chance to catchup. Despite being very close, we live over 100 miles apart so we never feel as though we spend as much time together as we would like.

I am 46 and my sister is 44. most days during our holiday, our husbands would go off cycling, leaving us to the more fun stuff ( cream teas etc!). This gave us a good chance to catch up. I have noticed in recent years that their lifestyle has become more 'flashy' with them both having brand new cars, more exotic holidays, new caravan and lots of work done to their house. I suppose that they have always been slightly flashier than us, but then they have a better income. She is a deputy head teacher and her husband works as a successful self employed carpenter. She had already told me that their joint take home pay is well over 5k a month. I assumed that she would have a bit of debt, as we do, but I was shocked at the extent of it.

During a conversation, she told me that both of their new cars are on finance ( one on finance and the other paid for with a bank loan) and that they also took advantage of the HSBC 3.3% loan offer to purchase their new caravan last year ( the one that we stayed in last week) They also have around 15-20k in 0% CC debt along with another loan that they took out for their kitchen. She also told me that they have a 'few' BNPL deals of furniture totalling a few grand.

A quick calculation my head told me that their debt was somewhere between 50-70K. I told her that this concerned me ( big sister mentality!). She is totally chilled about it though and explained that they owe around 65k at the moment, but that it is well managed and not an issue as they can easily afford the payments without sacrificing other things. She reckons that after they have paid their mortgage, essential bills and debt payments, they are left with around 2.5K per month which they only have to buy food out of. She also has 20K saved - we both inherited this amount a few years ago, but mine went into the house purchase.

She had her kids in early twenties so they are now in a position where the kids are independent and working full time. She explained that they decided to have the things that they wanted now, as a sort of mid life blowout, whilst they could still afford it. Apparently it will all be paid off within 5 years.

I know that she is an adult, but as her sister I can not help but worry. My husband has told me to forget about it and that if they can manage it then it's not an issue. We were brought up with very sensible parents, and this has stuck with me. I have told her of my concerns and she laughs and tells me to stop worrying and that everything is fine. In fact, she hadn't even thought about the total amount until we started discussing it on holiday!

Am I overreacting?

Money_maker

Nope, but if she's not bothered about it then let it rest. You may find that you've planted a seed of doubt and maybe she'll give it more thought and realise it's OTT.

katiepkh

Thanks Moneymaker. I am sure that she is has it all under control, but the amounts just worry me.

EssexHebridean

Of course you're going to worry - as you've said, big sister and all that! However, one thing we have seen on here consistently over the years is that it's not possible to have a "lightbulb moment" for someone else. That level of debt would scare me rigid, yes - but their monthly disposable income is a LOT higher than mine, and that 2.5k spare per month means they can make a massive impact on the debt if needed in a small space of time. It may also be of course that they are also stashing money aside into savings that you don't know about, which would let them pay a great lump off the debt should the worst happen.

I'd say there is little you can do but sit back and leave her to it at this point to be honest - to try to interfere might damage your relationship far more.

Heather2603

You can worry but frankly it isn't any of your business. Definitely stay out of it.

chelseablue

I would be the same if my brother owed that amount.


Me and my partner take home just over 4k a month and I cant wait to get rid of our debt of £4,000 on a 0% card, I'd probably have a heart attack if I owed £65,000

zippygeorgeandben

What a lovely caring big sister. I have two sisters (one older one younger) and they are always asking me for financial advice (which is ironic considering I struggle with my own!). My eldest I feel hates her own company so would much rather go out with friends and socialise more often than I think she needs to.
Late last year she wanted me to help her get a grip on her finances and I was shocked by the £££s spent on taxis , takeaways, HP made, clothes per month but hey, she got a 6 figure salary so can spend more. A month later she was told her probation period wasn't being renewed and she would have to find alternative employment. Suddenly panicked her and then she was telling me everyday what she was spending because she needed to cut her cloth. Trouble is, a lot of her CCs and HP agreements were all locked in with high %. Two months later, got a new job, same salary and she's back to the darling lovely generous sister I cherish and yup, back to spending ££££s
What I'm saying is that you can't make people see things your way all the time no matter how kind you are being. If you are going to give any more advice, mine would be to just mention having 3 months salary as an emergency fund. There have been many posts on here about people having a successful business and then X,Y,Z happens. People also get ill right?

Mojisola

katiepkh wrote: »

She is totally chilled about it though and explained that they owe around 65k at the moment, but that it is well managed and not an issue as they can easily afford the payments without sacrificing other things.

She explained that they decided to have the things that they wanted now, as a sort of mid life blowout, whilst they could still afford it. Apparently it will all be paid off within 5 years.

There's nothing you can do about her attitude to debt.

What she doesn't seem to have taken into account is that life can change - they are both in well-paid jobs now - what if one of them lost their job or couldn't continue because of health problems?

The chances are high that all will be well but having a life changing event and a massive debt could make life very difficult. As her sister, I might have one more conversation and raise that issue and then leave them to it.

zippygeorgeandben

Mojisola makes valid points. The point made by your sister that it will 'apparently be paid off within 5 years' does this mean that they aren't going to be splashing out until 2022? I very much doubt it!

Mojisola

zippygeorgeandben wrote: »

The point made by your sister that it will 'apparently be paid off within 5 years' does this mean that they aren't going to be splashing out until 2022? I very much doubt it!

This is the other point that would concern me - once you get used to spending beyond your income, it isn't easy to cut back.

Filo25

Mojisola wrote: »

This is the other point that would concern me - once you get used to spending beyond your income, it isn't easy to cut back.

Agreed, unless you get the LBM I don't think many of us tend to change our broad spending patterns too much (unless we are forced to).

Between me and my wife we have a good income, but still acquired a pretty large amount of debt (I say we, it was pretty much me!), buying a house last year only added to that, but have decided now that enough is enough and I am making decided efforts to get rid of it within 3 years and then to move on from that to tackling the mortgage aggressively as well, maybe its just because I see the prospect of retirement in 20 or so years and want to make sure my finances are shipshape well before then, plus as others have said getting rid of the debt just gives you much more resilience to deal with life's misfortunes if you are unlucky enough to have some of them.

Unfortunately you can't make anyone have their LBM.