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?

You honestly sound like you have a saviour complex. Presumably, you'd talk to your husband before moving another person into your house. At least.

You may well find the reason she doesn't want you to tell her husband or yours is I would guess they have bailed her out in the past and she knows they will be doubly angry.

This is what happens with people who stack up debt, first the people closest to them are asked to bail them out, when goodwill is exhausted they move to those a step away.

I suggest you get together the relevant information and sit down with her. Literally, physically, hold her hands and tell her “I can not pay off this debt until you have taken steps to help yourself get to a better place. I will go with you to your family, the GP, and these charities in any order you like. After you have met with two of them we can discuss a repayment plan to clear the balance of your debt. But it can’t be done in secret or without a plan to deal with the addiction issues.

I agree.

as a first step, she - not you! - must cut up all her credit cards.

And don’t even think of paying off her debts behind your husband’s back. It would be a betrayal of trust which might seriously damage your marriage.

But above all: do NOT pay off her debts. Just don’t. It won’t work. She has to do this and learn.

As I have said, yes I would - he has been keen for her to move in as well.

Can you explain why? Aside from the debt, I think we’d all love it - she’s such a sweet girl, she’s amazing with her niece and regularly will spend a weekend with us to see her, we’re due twins in the winter and she’s always been so lovely with the kids when they were babies. She’d adore it, I feel it would be really good for her.

Personally I think the grooming comments are a bit OTT and no one here can know your SIL like you do.
I do think the comments about hiding big family secrets from your husband are on point though. I would not be at all happy in your husbands position if I were to find all this out later - financial infidelity is a big deal in my book and personally a red line. I assume others agree with me and that’s why you’ve had the comments

It’s because some of us have been on mumsnet for years and seen this many times before.

The script goes something along the lines of My poor friend / SIL etc was going through such an awful time, I sent my DH round to their house / let them move in so we could ease the stress they were under. I did everything I could to help her… then lo and behold, the poor friend / SIL runs off into the sunset with the DH.

I don’t think it’s financial infidelity though. I’m the higher earner, and we have a set amount we contribute to bills, household savings and a “maternity leave” fund, as we call it. Whatever is left over after that is ours to do with as we please.

This is so simplistic and very saviour complex, sorry. First you said you didn't know why she did it - could've been MH or boredom. Now you say it's because her family are horrible and she needs to keep up the facade of wealth. Just say it is because of the horrible family. Do you really think you can fix the kind of damage done by a horrible family simply by waving your wand and making things nice? That she won't still have the issues that she's developed over her whole lifetime with a horrible family? I'm not saying don't help her, but you're not addressing the real problems with this idea that it'll all change as long as she's with your nice family playing with your DC and working at your nice company. More likely she'll feel worse when she lets you down, can't pay you back and finds a way to blame you. It'll be better for her and your relationship if you do the proven steps to helping her manage the debt and stand on her own two feet, rather than taking this huge level of responsibility for fixing her in your DIY way, which people here are telling you has been tried and failed and that's why those proven ways exist.

Also to the PP who wrote: I would pay off her debts if you’re able to, but get her to pay you back a sum of money monthly. Is that not exactly what all her lenders have so far done? Why would it work with OP who is much more likely to write the debts off than a bank?

I think that is a bad decision personally to pay off any debt, even if you are matching payments she makes @mummytoonetryingfortwo . You can explain to her that the free board you are giving her in London is worth over £1k per month and the introductions you are making to help her get a job are what will enable her to pay off her debts and make a financially secure future for herself. How else is she going to appreciate the value of what you are doing otherwise?

MN is weird about money. I 100% think you’re doing the right thing paying off her debts. But, as stated above, I think you should be more sensible about the conditions under which you do it. You need to actually help her, not just give her the opportunity to fuck up again.

You’re suggesting my husband’s sister is going to sleep with her brother and “steal” him from me?

When you are in that kind of debt an extra £20 spent here or there means nothing. She will only stop when she feels comfortable.
I would transfer everything over to a 0% interest credit card (including the loan) and just pay a little bit extra each month on top of the minimum payments. I did something similar and it really helped.
Please don't take on the debt yourself as another will be built up. It makes you quite proud to keep up the repayments yourself and it's the only thing that will work short and long term. x

The thing is OP everybody who wants access to your cash is overly nice, and they play on your desire to help.

Take it from someone who in the last 3 years has thrown tens of thousands of pounds at helping my BIL, only for him to still be in exactly the same position, because he’s not doing a single thing to help himself. We throw him a life boat and all he does it start filling it with water to sink again because now he knows we are capable and willing to help. We are now no contact.

Well that fair enough but if your DH has the same interpretation of financial infidelity as me, then you have a BIG problem

Do you know if there are longer term 0% interest cards?

She obviously comes from a wealthy background. If she refuses to seek help, medical or some sort of therapy, she won't be able to stop her compulsive spending so after you have bailed her out, she will just build up debts again.

You say that you have the money to help her, but I'm assuming that her brothers and parents also have enough money to help her so I don't think that you should feel responsible.

She needs to seek professional help, contact debt management charities and Citizens' Advice and tell her parents. If they refuse to help her, you could step in at that point.

Readytohealnow

She needs to go to her GP now. She has an addiction and you are not an expert in this.

Im a bit blown away by this and mean this honestly- would a gp deal with this? Honestly? Yes it’s a mh issue or as people said an aspect of an undiagnosed issue, but surely first port of call is a debt management charity that can help her build a plan as to how to get it broken down into manageable repayable sums and how to deal with the companies.

My apologies! I missed that it’s your DH’s sister.

Ah well, your DH is safe at least.

That aside, still a very bad idea. She will take advantage in other ways.

i think the first step will be to sort a consolidation of debt, I will ask her to contact step change. Next step will be to get her down to London and working properly, I think. £1,200 a month is so very little to live on, no matter what debt you have. I can see how she’s got into a position of chasing her tail in terms of paying off the debts.

Ignore the ridiculous posts and focus on the posters who have very good advice.

Your question was "how do I stop her spending?"

Everyone it telling you that YOU can't, and that bailing her out will not solve her problem. Listen to them.

Sadly if you bail her out you are treating a symptom but it won’t address the root problem

And I’ve accepted that - and I’m now trying to move onto a different plan to help. No matter what people on here say about her grooming me, I do believe she is very unwell at the moment and needs help. I’m touched that she has come to me for help. I’ve known her for 8 years, so I don’t think I’m overly surprised that she’s turned to me. But it’s still nice.

Don’t bail her out. It will change the nature of your relationship with her. Have a look at the Dave Ramsey method. It works.