My sister in law is in severe financial trouble, how do I stop her spending?

[mummytoonetryingfortwo]

My sister in law has revealed to me last night that she’s in real difficulties and has asked me for help. She’s 23.

She works 25 hours a week for £12.60 an hour, so brings in £1,200 a month. She is studying for her masters, so cannot work more.

She has told me that she has nearly £5,000 in credit card debt, £1,500 in Klarna debt and, I believe, a personal loan around £7,500. She also has an interest free overdraft of £500.

She is spending the majority of her wages to pay off her debts, meaning she’s living in her overdraft. She just cannot stop herself spending. She’s almost addicted to it. She wants new things all the time, it spirals, and she gets into this mess. She’s now told me she’s felt suicidal over these debts.

I am able to clear these debts. I want to, but I want to do it on the condition that she breaks her spending habits and starts to get herself sorted. What can I do to help her on this path? What tactics can I use?

I can see that you care about her OP but I honestly think she should just apply for a Debt Relief Order. Her credit rating has possibly already been affected and the DRO would (hopefully) prevent her from obtaining credit from anywhere else.

https://www.citizensadvice.org.uk/debt-and-money/debt-solutions/debt-relief-orders/debt-relief-orders-explained/debt-relief-orders-what-you-need-to-know/

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I may be cynical and jaded but I've sadly got the Tshirt for the exact situation with family members. Bailing her out yourself will just wreck your relationship when she doesn't pay you back because she can't help herself without support you're not equipped to provide. My entitled BIL and SIL were both like this and our relationship no longer exists. They'd sell their soul for the next shiny "must have" tiktock item with no thought about how they will pay family and friends back. The endorphin rush from buying something may reduce their depression temporarily. Instead of working on themselves and selfsoothing differently they just spend (or overeat).

Why has she not asked her siblings or parents to help her out? Be aware her debt will probably be even more than she's acknowledging too.

Giving her money to pay off her debts is akin to giving an alcoholic money to buy alcohol.

She needs to get help from a professional.

Well that was a very difficult conversation.

Unbeknownst to my husband and I, my PILs have been comparing my SIL to me and my BIL’s wife (I also call her my SIL, but I think that’ll be too confusing!) for years. It got really bad at Christmas, where my SIL bought a dress from ASOS and was really happy, but after Christmas lunch my MIL took her to one side and basically said she couldn’t believe that my SIL would embarrass her so badly by looking so “disgraceful” compared to us. My MIL also chastised her for buying “cheap” gifts for the family, especially my DD and my nieces and nephews. If we’d known about this at the time, we would have obviously spoken up.

There’s also been a lot of snipey comments about her career, her degree etc., and how she’s failed the family, which again is not true.

We didn’t realise that her student loan didn’t cover the entire masters cost, she’s been paying £150 a month for the course. She doesn’t have that long left, but she’s going to defer a year and just figure out whether it’s really what she wants to do.

Since then she’s been purchasing designer jeans, jumpers, dresses etc. the interest payments have spiralled and she’s panicking. I think part of it stems from my MIL, in particular, not knowing what money is worth. She’s semi retired and works part time, so seems to think you SIL should be bringing in what she does. She’s totally out of touch.

What I had seen as a spending addiction was actually just a desperate attempt to win her mother’s affection and respect. I feel so sorry for her.

My SIL is just entirely broken. She’s downtrodden, depressed and I think burnt out. She’s always insulted and basically bullied by my MIL. As an aside, we’re going to be going low contact with her, because everything she’s said is just horrible. It’s low level bullying from the woman who’s supposed to love her unconditionally and it’s really messed up her mental health.

But, she does want to change. We’re going to list as much of what she’s bought on vinted as possible, and all of those sales will be going to paying off the debts.

I’ve said that for each sale she makes I’ll match 50-100% of the sales, dependent on what they go for. If she can sell the whole lot, I’ll match another 50% of the total sales. She very tearfully admitted that she hated the clothes she’s bought, but she was trying to make my MIL happy. Which just broke my heart. She doesn’t deserve this.

She turned down my offer of paying the debts in a lump sum, which I respect. She asked me to put it into an account for my children, which I think sums her up. This was all because she wanted to make other people happy.

She’s going to take up the internship at my company, we’ve worked out a budget that covers debt repayments and travel and everything else she needs. My husband will be covering her overdraft and gifting her £1,000 to get her back on her feet before her pay check comes in, on the basis of her repaying it to him if she fritters it away on useless stuff. But she seems committed to curbing her spending. I don’t believe that it’ll be an easy, immediate road, but she seems committed.

She’s currently on the phone to the credit companies to see if plans can be worked out. If not, she’s going to contact step change to get a plan worked out. My husband has gone to his parents’ house to collect her belongings, she doesn’t want to see her parents right now and we’ll be supporting that.

I think from here we’re going to have to tell my BIL and his wife about what’s been happening. We had no idea things were this bad. We’re also going to get her into therapy (obviously) and just surround her with love and happiness for now. We’ll be funding the therapy, and she’ll be starting work on Tuesday of next week.

Thank you to everyone who gave me solid advice on this one, it’s a lot to navigate but we’re going to get through it as a family. I don’t think forcing her to feel pain in this scenario is appropriate, because she’s feeling so much pain already. She’s got the plan to pay it off, and that’s earned a lot of respect from my husband. My head is a mess now, and my husband is really, really angry. But all we can do is try to help her out.

I'm going against everyone else here and think that it's a really nice thing for you to do.
Would you be open to paying it all with a signed agreement that she pays you back a set amount each month (interest free) so that shes taking some responsibility for her debt but equally not giving all these card companies more interest. She will never get out of it otherwise. Add on the condition about moving to London too. Perhaps do some babysitting for you guys as a way of "repaying" the favour.
However you also need to be prepared to lose all the money if she doesn't pay you back, and to tell your husband down the line if she gets into that mess again.

Does she know you have the ability to clear the debt? If not, I wouldn't tell her. I appreciate you want to help her out, but the only way things will change is if she has to dig her own way out of this and learn the hard way. Otherwise you will end up right back where you are now, only with more damage done to your relationship.

There's a YouTube channel called The Financial Diet. It's American, but the woman who runs it, Chelsea, started out in a similar position to your sister. Massively overspent in her early twenties and found herself drowning in credit card debt. Obviously this isn't a fix for your sister's problems, but have a look at some of her earlier videos. You might find her advice - from someone who has 'been there' - makes your sister feel a little less hopeless.

Good luck.

Have a look on Martin Lewis' website Money Saving Expert especially the debt free forums..they will definitely advise not just bailing her out as she needs to change her spending habits and face any addictions to spending otherwise she will end up in exactly the same place again and also owe you money as well! Advise her to create her own debt free diary on there- she has to sort this out for herself with support from others but not doing it for her.

Well everything is out in the open now and you can start to help her recover & heal. You're a lovely SIL op, she's lucky to have you.
Wishing you all best with your SIL and the future arrival of your darling twins.

Thank you 🩷 it’s going to be a long road for her but we can only do our best

firstly, who says I am British? Secondly, its not names at all - I see the situation from a different and unmeshed perspective, I dont say i am right I am simply providing an alternative perspective. Helping out a family member is fantastic, but spending your money to sort out an addiction when the person seems not to want to acknowledge it or seek help is foolish - especially when the OP has twins on the way. Its complex and horrible but thats the facts. Currently the SIL is fully responsible for her actions - if the OP pays off all the debt, any subesequent debt and the falling out with family will be her fault due to enabling so she has to be prepared to face that reality herself. Not really a reality i would want to bring on my own new family.

I see its all come out now so good luck with the plan - hopefully her behaviour will follow the words and she is able to get a grasp of it. I hope she can also get some therapy to help process the shitness of the family.

Please don’t give her the money. It will damage your relationship and it sounds like you have an excellent one! Plus it will teach her absolutely nothing long term.

What you need to do is facilitate her telling her family so they can support her. Other things you can do is try and find her mental health help alongside financial debt help.

Goodness that is a huge amount accomplished in one conversation. Good luck @mummytoonetryingfortwo and to your SIL too. I hope she is able to get a grip on her spending and desperate need for approval from her mother with the therapy.

I really feel for your SIL and the difficult cycle she’s in. From what you’ve shared, it sounds like her spending and debt is tied to deeper emotional pain and relational trauma especially with family dynamics from such a young age (during her formative years). Debts and spending can be a form of self-soothing when someone feels trapped and unseen.
I think your idea to move her in and create a safer, more supportive environment could be very healing for her. That would give her space to rebuild trust, feel less isolated, and eventually manager her finances with less stress. It is understandable that some people say ‘don’t bail her out’ but healing and financial stability often go hand in hand, especially where trauma is involved.
If you’d like, I’m a financial coach and would be happy to offer some support or guidance. Feel free to DM me. You’re doing something really kind and brave by wanting to help her out. Just like we can be traumatised in relationships, familial or otherwise, we can heal in safe relationships too.
Wishing you both strength and clarity.

My husband is no nonsense, straight to the point 😂 it helps in situations like this when I just sit there in tears! He’s a good egg, bless him, and it feels like some progress has been made already.

My husband is no nonsense, straight to the point 😂 it helps in situations like this when I just sit there in tears! He’s a good egg, bless him, and it feels like some progress has been made already.

Personally I wouldn’t get her out of the situation by paying off her debts because she is likely to start it all over again and be in the same situation. Instead I would help with combining the debt into one doable monthly payment plan. She needs to learn about her spending habits and if she has someone to bail her out each time she’ll just assume they will again

If she does not want help fixing her issue why on earth are you considering bailing her out?

Things have progressed a lot, which is why I’m going to help her. This is as a result of, essentially, bullying by my MIL.

Sounds like a very useful conversation. I’m sure beind distanced from that toxic relationship will be very useful for her.

Don't pay it off. She needs proper debt advice. Many debts can be written off if you get debt advice. Debt advice is free. Try Step Change.

Please don't bail her out. My 'DP' has been bailed out of his debt once by me and once by his mother and I've recently discovered tens of thousands of hidden debt. There is just no consequences and therefore no lessons learned. Moving her in, bailing her out, supporting her is all very noble but honestly I think it's just a disaster waiting to happen.
The best thing you can do is sit down and help her realistically plan and budget her way out if this. She needs to feel the effects of her actions and get herself out of this. There will always be someone richer or more successful than you, or someone with shinier things but you cannot use that an excuse to get in to debt.
Point her Dave Ramsey.

i’d recommend Christians Against Poverty. I was listening to a radio interview about them and they support people who are struggling with debt, getting them all the necessary help in all the necessary ways.

If you really want to help, get her to seek proper advice from addiction services, DONT pay off the debt, that won't " help" in the long run.
You wouldn't repay the debts if they were drug- related, so why pay off these?
It's lovely that she is happy to share her situation with you, but that's probably just because she knows you'd want to help and that you wouldn't tell anyone within the family. Dont enable this behavior to continue ( and it will!)

The situation has moved on a lot, we’ve agreed how we will help

Well done on moving forward and making a plan. Hopefully she’ll stick to everything going forward.

(with a slight caution that she hasn’t been selling you a sob story).