What would you do to help?

[KadieK]

DH mum has told us she has no money left.
She had used all her savings on paying for her lifestyle and rent and has nothing left.
She does work but will not be left with much after her rent and bills are paid off.
It doesn't look sustainable for her to be able to stay in her flat.
We don't particularly want to help with paying rent as it doesn't solve anything. We are worried she will rack up more debt to try and look like she can afford things. She isnt entitled to any help with rent payments either.
Our house isn't big enough for her to move in.

Obviously it's her own fault for spending all her money but she's still family and the end of the day

Seek debt advice, they may be able to help

Unless you are wealthy and actually want to fund her lifestyle, do not give her any money.

She's spent all her money so do you want her to carry on and spend all yours too? Bear in mind that she's likely to come to you when she 'has no food' or 'can't pay her electricity bill' as she sounds like the type of person who just spends all her money on clothes etc, going out, holidays, a fancy car or whatever her personal indulgences are and just refuses to budget like an adult.

How old is she and is she likely to be capable of working until/after she receives her pension? Do you know if she has any other pension arrangements above her state pension? Once she's of state pension age, she'll get her rent paid and income topped up if she only has the state pension, so she won't be homeless and will be able to cover the basics, but it's not a luxury lifestyle.

Could she earn more either by working more hours or retraining, or could she move somewhere cheaper? Could she sell some of the things that she's bought?

Is the problem that she's on a low income and is always going to struggle to cover the basics or is she just a spendthrift who would burn through any amount of money on non essentials?

What's the history to this? How come she had savings and chose to spend it rather than buying somewhere to live?

The best way to help her, which probably won't feel like it to either you or her would be to stand firm, don't give her any money and help her budget to maximise her income, prioritise essentials and stick to spending only what's left over. Unless of course you want to finance her fun lifestyle.

But if she gets into debt, so be it, it won't affect anyone except her, assuming she's single, and she can't lose her home over it, unless she doesn't pay her rent. She'll just have to deal with being chased by the credit card and loan people if she doesn't pay back what she's borrowed and the eventual bad credit rating/DRO/bankruptcy, that will prevent her from borrowing more money if it all goes tits up and she borrows more than she can pay back.

Hmm if she's entitled to no help then she must be earning a decent amount but spending it all. Is it all going on debt repayments?

perhaps suggest citizens advice or step change?

Don't get involved in bailing her out by giving her money, that will only result in her becoming increasingly financially dependent on you, and having spent all her own money, she will then spend all of yours!
Instead, try to help her in practical ways, help her to budget, look at benefits websites, show her how to sell items on Vinted etc, tell her about debt charities such as StepChange, encourage her to increase her own employment income.

She's 63
Had money from divorce and house sale.
Her rent is £500 the plus bills and council tax.
She earns £1200 pm
She has always been rubbish with money but never expected this.
No pension, no savings, no nothing apart from her wage which she can barely afford to live on. I've contacted Citizens advice but the person said she isn't entitled to any help with rent etc and the council wouldn't house her.

she might not get benefits but she needs a budget and perhaps stepchange

Work more hours? Take home pay on minimum wage for 40hrs/pw is £1,700.

She needs to check whether she'll get full state pension in a few years' time. If she logs onto the gov.uk website, she'll be able to see whether she's on track for a full pension.

Is she claiming single person discount (25%) on her council tax?

So her rent is cheap. That's a good thing, but she's unlikely to find anywhere that's significantly cheaper, even a council place where she'd still need to pay full rent. What's the flat like on bills?

She needs to work full time, even on NMW that would increase her income to £1700 pm. Is she in good health?

She could do a benefit check but unless she's disabled, she probably won't be entitled to any help. The benefit system is not there to allow healthy adults with no caring responsibilities to work part time and fund a shopping addiction.

Will she get a full state pension when she's 67 - that's nearly £1000 a month and she'll be able to top it up by continuing to work if she's able to.

Any idea how much money she's got through from the divorce settlement/house sale?

Don't give her any money.
I'd sit down with her and make a budget - list all no - negotiable fixed outgoings then she will know her weekly 'spending' budget.
If she wants to spend more than that she needs to work more or move jobs for a pay rise. Could she do some cleaning cash in hand one day a week, for example ? That would cover groceries.
I'd also look on Rightmove for cheaper/ studio properties and show them to her - she might be prepared to move or it might shock her into taking action if she wants to stay in her flat.
Be very clear that you can not house her or pay for her.

You ask what I would do to help if in this situation with my MIL.

I agree she is family, however I also think it is a case of ‘give a (wo)man a fish, she eats for a day, teach her to fish, and she eats forever’. So my help would not be financial, but in getting her financial counselling, practical help with budgeting now, and longer term financial planning for her retirement (ie eligibility for pension, saving/adding to it, and adjusting her lifestyle to fit the reality of her finances). It might be personally helping her with this, or doing the research of places to refer her too, and then going with her for support. It might also include encouraging her to work more or get a higher paying job - practical help with CVs, interview suggestions or skilling up for other jobs. And possibly even assisting her to sell things online if over consumption is the issue.

I repeat again, that I would NOT give money, as whilst I would do so as a one off to a family
member needing specific help (unexpected medical bill, unexpected car repair bill etc) this scenario is not a one-off but a lifestyle trend and a one of gift of money will not solve it, but actually
make it worse, as it delays the inevitable moment when she needs to face the issue head on, and (if you have given money) will probably annoy you and your DH, so you are less likely to help with the steps I have suggested above when that time comes and she really needs it.

She has the same income leftover after rent and council tax as me and I live fine, don't necessarily scrimp, just don't splurge either.

The thing she'll be missing is a safety net if one of her appliances go wrong, if she gets a fine or id she desperately needs a holiday. If I was your dh and I did want to help my mum, I would probably offer to help with paying for appliance repairs/new appliances as and when. I'd invite her on holiday with me now and then, and invite to tea once or twice a week.

Other than that, don't give regular or big chunks of money

I don’t see what the problem is here - she has almost no disposable income left, so what? She can still support herself with the basics and presumably can get a 2nd job. She’ll have a pension if she’s been contributing regularly with N.I.

I agree that practical support with signposting may help so please don’t give her any money just for her nice stuff. Apart from anything else it can cause resentment and may damage your relationship with her.

She needs to up her hours .

She earns more than enough per month to cover bills, she's clearly not living within her means. At 63 she really is old enough to know better, she must realise she can't spend spend spend and expect everybody to help her out.
Her wages will cover her bills no problem, luxuries like sky tv, expensive phones etc, subscriptions can all be cancelled if needs be.

Why don't you suggest she does the free course by Rebel Finance School- they cover tracking spending, building a gap, money mindset and having an emergency fund (as well as paying off debt, investing, saving etc). You could even offer to do it alongside her.
There are other people you could suggest like Dave Ramsay. There are people on YouTube, Instagram, with books, podcasts etc. These days there is someone for everyone.
I do not think you should help by providing money but maybe helping her with tech if she's not good with that or budgeting or tracking spending or a plan to repay any debt. She really needs to work on her mindset and self resilience.

She's only 63 she can increase her working hours.

What was she hoping you would say @KadieK ?

You could offer to go through her budget with her.

What do you mean by 'no pension' No private work based pension or never built up adequate NI contributions?

Lodger?

Looking at those figures she may get some UC to help with rent, possibly only a small amount. I would use the Age Uk benefit calculator online, usually pretty accurate just to check. Does she have spare bedrooms, could she take in a lodger.

She can complete a form for universal credit and see what it comes out with as it is a low wage.
are you able to sit down with her and go through her bills line by line. Ensure direct debits are set up to go out after wages come in and let her know what she has left. Set up a savings account that even if she only puts £10 a month it will build up in case the fridge breaks.

let her know that she is in control now and must take responsibility for herself

you can log into national insurance pension to check what she can expect as state pension and she needs to take action now as there is no safety net

Some good ideas all ready mentioned like lodger or increase her hours.

Otherwise she could let her flat go and apply for a council flat. In the meantime she could live in a house share, they usually include bills so can be quite a cost effective way of living.

We found out after my grandad died he was in >70k debt and he had nothing to his name bailiffs came but he had nothing to take. The debt was written off when he died.
It was heartbreaking knowing he lived like this. But, he was a gambler and poor his old age pension in slot machines and credit card companies lent to him with no income or assets, so more fool him.

Currently, she has money left over as right as it is, she'll have to learn the lesson to budget or work more to find her lifestyle. Do not get involved in subbing hee, just cos she's family doesn't mean you are responsible for poor choices.

If she doesn't learn now, she never will! If she hasn't got it she can't spend it.
Right now she can't get help, but that
Might be different in the future.
But definitely check her state pension, and she may need to make priority contributions to increase state pension to get full amount.

I wouldn't be doing anything at all, unless you are super close to her and she has been a wonderful and generous MIL to you over the years, and given you money and/or support over the years.

She is an adult and can solve this herself.

At a push dh can give her the telephone numbers for advice and guidance. Do not give her more money, she will just burn through that as well, and could have another 30 years plus of life left, and will then be coming to you for more. It will cause a huge family rift trust me.

Your MIL needs to learn to live within her means, the correction will be painful and I would offer her tea and sympathy and nothing else. This is not your or your dh's problem to fix. You will do more harm than good to family relations if you get involved.

A standard reply might be 'that sounds tricky for you, what do you plan to do?'
She will come up with a solution eventually.