My in-laws collision course with bankruptcy

Pollycat

The OP has posted (on the other thread):

After sticking our noses in initially without invitation, the father has come round to the idea of changing a few things to save money. He seems pretty happy about any support now. He was unaware of his situation so I think our intervention is now seen as a good thing.
Mother has not shown much interest so we're not really helping her at all.

So you can still take a horse to water but it it doesn't want to drink, it won't.

I'm not sure how it will work if the in-laws have joint finances and one is happy to listen to advice and the other one isn't.

Marvel1

You tried, they don't want to know, fair enough as its their business.

If they ask for help later on, I wouldn't get involved, they can do it themselves.  I definately would not be helping by giving them money.

Fireflyaway

You are obviously coming from a good place but finances are quite a touchy and personal subject. Advice meant to be helpful could be deemed intrusive. You also don't want them to become dependent on your advice or learn nothing and get back into debt. I'd probably give them a budget sheet to properly work out income and expenditure and then point them in the direction of a free money advice service. We also need to accept that we all have have different attitudes to finance. At my age my dad was close to retirement and my parents house was nearly paid off. Here I am today in a rented house, low paid job and have the grand total of £80 in savings! Debt just doesn't bother some people. Whereas some people will save and save to have a comfortable retirement, others won't bother. They are happy for the state to support them.  I honestly wouldn't get too involved for worry of damaging your relationship.

zippygeorgeandben

To the OP - it is great you are trying to do a good thing here, but no good deed goes unpunished.  Just please do not offer to help financially when the time comes.  Oh and early 60s isn't elderly, they can make decisions. Don't jeapordise your future to secure their present. 
As for the posters with their rude and lack of courtesy to you (meaning even a moderator had to tell people to be kind), take what they say with a pinch of salt.  Please keep us updated.

Superfuse

So, having not mentioned finances with the girlfriend's parents for a week or so; the father has come to us to extract a sum from his pension to clear most of his credit card debt. He has been receiving correspondence from the pension company suggesting that he has some options.
I suspect that taking a tax free 25% lump sum (to clear most of his credit card debt) and buying an annuity is probably a good idea. We are however not experienced with pensions. The partner and I will be proceeding with caution and will possibly encourage the father to see a financial advisor to discuss his pension options...

Pollycat

Superfuse said:

So, having not mentioned finances with the girlfriend's parents for a week or so; the father has come to us to extract a sum from his pension to clear most of his credit card debt. He has been receiving correspondence from the pension company suggesting that he has some options.
I suspect that taking a tax free 25% lump sum (to clear most of his credit card debt) and buying an annuity is probably a good idea. We are however not experienced with pensions. The partner and I will be proceeding with caution and will possibly encourage the father to see a financial advisor to discuss his pension options...

Might be worth posting on the Pensions board, some very knowledgeable people there.

Of course, using part of his pension to clear credit card debt will mean he has less money when he comes to retire.

And many people have used money from various sources to clear credit card debit only to run the debt back up again...

fatbelly

Superfuse said:

I suspect that taking a tax free 25% lump sum (to clear most of his credit card debt) and buying an annuity is probably a good idea. 

It probably isn't . Annuities are terrible value. If he can get the debt to 0% one way or another then repay from surplus income, leaving his pension alone, that would probably be better

MallyGirl

Take a trip to the pensions board on here - there is a lot of information and some very knowledgeable people. If an advisor is engaged it should be an IFA where the I is for Independent. Depending on the pension value the fees might take quite a bite out of the value but it might still be worth it to prevent expensive mistakes being made.
Annuities have one advantage- they are a consistent payment for life and cannot be raided once in place. The payment will not be great value for money though as rates are low as stated above.
Robbing their retirement income to pay off debt should be the absolute last resort (to prevent house repossession for example).

danandjens_worldtravels

As an alternative please consider that this may be the mothers experience and why she doesn’t want to change the status quo.

They are always working and never have any money for the things she wants and needs. She has access to credit and is scared that if you ‘interfere’ she will have no longer have access and be in a worse position, possibly one she has experienced in the past and having credit is her solution, It’s her only way to afford clothes and other things.   

Her reliance on credit is because she is paying so much more on charges and interest to keep that line of credit open, along with failures to budget and poor financial skills in getting good deals.

You need to show and explain that by budgeting properly and getting assistance with good deals, and dealing with the debt she will have money for those things she is currently using credit for. 

Also consider that bankruptcy for a nearly retired couple with zero assets may be a positive move.  Almost certainly a better solution than spending their pension to pay off the debt - a possibly short sighted quick fix which will lead to bigger affordability problems in later years.  

elsien

You could consider going through an online pensionwise appointment with him  to help you both understand, as a starting point.
They do not give advice or tell you what to do, but they do help with a general understanding of the options and the implication for taking lump sums etc.
https://www.pensionwise.gov.uk/en