My Dad Says We're The Reason He's Broke

Summary

Podcast Summary: "My Dad Says We're The Reason He's Broke"

Podcast Information:

• Title: The Ramsey Show Highlights
• Host/Author: Ramsey Network
• Episode: My Dad Says We're The Reason He's Broke
• Release Date: July 1, 2025
• Description: The Ramsey Show Highlights offers a quick, daily dose of advice on life and money in under ten minutes, featuring insights from experts like Dave Ramsey, Ken Coleman, Rachel Cruze, Dr. John Delony, George Kamel, and Jade Warshaw.

---

Caller’s Dilemma: Parent Plus Loans Strain Family Finances

In this episode, a caller (referred to as "B") reaches out to discuss the financial strain her parents are experiencing due to Parent Plus Loans taken out to fund her and her two older sisters' education. The caller explains that her father often attributes his financial struggles and inability to afford life insurance to these loans, creating tension within the family. Despite graduating 16 years prior, the caller's parents are now approaching retirement, and the burden of the loans continues to affect their financial stability.

Key Points:

• Loan Details: The Parent Plus Loans have been consolidated and stretched over an extended period, totaling approximately $40,000. The caller and her sisters do not possess the $15,000 each needed to address the consolidated debt.
• Family Agreements: Initially, there seemed to be an understanding that the parents would cover the loan payments during the children's education, with the expectation that the children would assume responsibility afterward. However, life events such as marriages and parental relief have led to inconsistencies in this agreement, leaving the current generation unburdened but emotionally strained.

Hosts' Analysis and Recommendations

The hosts, identified as "A" and "C," delve into the implications of the caller's situation, expressing disappointment in the father's approach to managing the family's finances. They emphasize that the children are under no legal or moral obligation to repay their parents' loans, especially when doing so compromises their own financial well-being and family stability.

Notable Advice:

• Financial Priority: Before assisting the parents, the caller and her siblings should stabilize their own finances. This includes paying off existing debts (e.g., car loans), building an emergency fund, and managing household responsibilities, especially with an upcoming addition to the family.

• Boundaries and Emotional Health: The hosts advocate for setting clear financial boundaries to preserve familial relationships. They caution against allowing guilt to dictate financial decisions, highlighting the importance of self-sufficiency and responsible financial planning.

Quotes with Timestamps:

• [03:12] C: “He feels bad, and he's not much of a... I mean, I gotta tell you, I'm pretty disappointed in him for guilt tripping his own kids after. It was a decision he made.”

• [04:14] A: “If it's 40 today, I would just take it by three, which is 15 grand, roughly 12 grand, you know, and just write a check and hand that to him and go.”

• [07:03] C: “But the learning that you can take from this today is don't be him. Don't be him. So this is your learning from this.”

Learning and Future Financial Planning

The discussion underscores the importance of not replicating the same financial mistakes. The hosts encourage the caller to use this situation as a learning opportunity to establish sound financial habits, ensuring that future generations are not burdened similarly. They advocate for early conversations about financial expectations and the importance of avoiding debt, especially in funding education.

Actionable Steps for the Caller:

1. Eliminate Personal Debt: Prioritize paying off the car loan and any other existing debts.
2. Build an Emergency Fund: Accumulate a savings buffer of three to six months to handle unforeseen expenses.
3. Refrain from Assisting Parents: Until achieving financial stability, the caller and her siblings should avoid allocating resources to repay their parents, as doing so can jeopardize their own financial security and family harmony.

Conclusion: Empowering Financial Independence

The episode concludes with a strong message about financial independence and the importance of not letting parental financial decisions dictate one's own financial health. The hosts reinforce that while helping parents can be a noble gesture, it should not come at the expense of one's own financial stability and future.

Final Thoughts:

• Self-Care Over Guilt: Prioritizing personal financial health is essential, and assistance to parents should be considered only when it does not compromise one's own financial goals and responsibilities.

• Setting Precedents: By establishing healthy financial boundaries, the caller can prevent the perpetuation of debt-related stress in future generations, fostering a more secure and harmonious family dynamic.

---

Key Takeaways:

• No Obligation to Repay Parents: Adult children are not inherently responsible for their parents' student loan debts unless agreed upon.
• Prioritize Personal Finances: Ensure your own financial foundation is solid before considering assistance to others.
• Healthy Boundaries Preserve Relationships: Clear financial boundaries can prevent familial strain and preserve relationships.

---

This summary encapsulates the critical discussions and advice presented in "My Dad Says We're The Reason He's Broke." Listeners gain insight into managing family financial dynamics, setting personal financial priorities, and fostering sustainable financial practices for future generations.

Transcript

[A]

Brought to you by Y Refi Refinance your defaulted private student loans [e-mail] Ramsey.

[B]

I have a question about parent plus loans. My dad took it out for me and my two older sisters, and I've since graduated. This was 16 years ago that I graduated. But anyway, they're kind of. My parents are getting to retirement now, and it's basically like they're. My dad always finds a way to throw in there that, like, he's paid on these Parent plus loans, like, our whole lives and just like, saying that it's the reason that he's broke and that he doesn't have money for life insurance and he's, you know, feeling the pinch of, like, retirement. And I basically don't know what to do because I don't really know how much he owes. It's all like, he just likes to throw it in there and kind of like he's upset about it. But my mom won't let us pay them because basically all three of my sisters, if we can't all pay, she doesn't want any of us to pay them back.

[C]

What was the. What was the original idea? Was the idea we're taking out these parent plum Parent plus loans so you all can go to school and this is our gift to you. Or was it said from the beginning, we're taking these out in our names, but you guys are paying them. Was there a agreement? Do you remember?

[B]

So it's been a long time, and I don't really remember what the agreement was for me, but I know for my oldest sister, I just recently talked to her about it. My oldest sister, who's eight years older than me, she said that when she. When they first did it for her, it was kind of like, we'll pay for the Parent plus loan while you're in school, but then after that, we want you to pick up the payment.

[C]

So did she pick up the payment?

[B]

She did for like, maybe a year. And then when she got married and she had a baby, like, my parents kind of just like relieved her of that responsibility.

[C]

So there's. It's a gray area is what you're saying. It's a little different for everybody, right?

[B]

And then my other sister did the same thing. She paid for a little bit after she graduated. But then since my older sister wasn't paying, my parents were like, well, it's not fair for us to make you pay. And so she stopped paying. But, like, by the time it got to me, none of them were paying, so they never made me pay.

[C]

Do you know. And if you asked how much they are, dad. How much. How much are they? Would he tell you?

[B]

The thing is, he consolidated them and stretched them out over this long period of time, which is why, like, it's also hard to pay because they're.

[A]

Do you have a total amount?

[B]

I think it's in the 40,000 range for all of them.

[A]

All right. And so do you and your sisters have 15,000?

[B]

We do not.

[A]

Then the discussions are relevant. Honey, you don't have the money. Your dad signed up for this, and.

[C]

He regrets it, and he's.

[A]

And he feels bad, and he's not much of a. I mean, I gotta tell you, I'm pretty disappointed in him for guilt tripping his own kids after. It was a decision he made. Be a man of honor. Eat your broccoli, buddy. You signed up for this trip. Don't dump it on your kids every time they come over for Thanksgiving. Or don't be shocked. They quit coming over for Thanksgiving. They're gonna get tired of you.

[B]

It has, like, pushed us away, you know, and.

[A]

Yeah, nobody likes being a travel. Nobody likes hanging out with a travel agent for guilt trips.

[C]

Now, there is a side of this, and I'm in no way putting this on you, but I'm putting myself in your position. If my dad had done this and I was hearing about it, me being who I am today or even back then, I might be interested in figuring out, okay, how much did you take out? It was my education. What is it that I'd want him to.

[A]

If it's 40 today, I would just take it by three, which is 15 grand, roughly 12 grand, you know, and just write a check and hand that to him and go.

[C]

Exactly. I'm clear. I'm done. I'm done.

[A]

You talk to the other two, and that's.

[C]

I mean, I'm not saying you have to.

[A]

What do you make? You're in your 30s. What do you make?

[B]

I make 50,000 a year. Or 50 to 60.

[A]

Are you married?

[B]

Yes.

[A]

What's your. What's your husband married?

[B]

He's about the same. 50 to.

[A]

So you guys make $125,000 a year?

[B]

Yes.

[C]

You have other debt?

[B]

Our house, and we're expecting a third baby on the way. And.

[A]

And you don't have a dime? Have any money?

[B]

I have. I do have a car note right now, yeah. Oh, 26 on that. But.

[A]

Good Lord.

[B]

Besides the car note and the. The car note and the house, we're good. And we do have a savings, but.

[A]

How much is in your savings.

[B]

Like 3,000.

[A]

Okay, so you're not good, you're broke. You're your dad looking for the same thing to happen in a few years. Okay? So you guys need to get your else crap together. Get this car paid off or get it sold. Get you an emergency fund built, and then you can have a discussion about whether you want to reach over and help your parents. But today you don't have a legal or a moral obligation in what you've told us. There's no ethical obligation here. It would be a gift, which is what Jade is describing, she would do. If you get yourself in a good, strong financial position and you want to give someone a gift that's related to this discussion, that's fine. But this is a charitable gift. You could write charity on the four line of the check if you wanted to, because you do not owe this money.

[C]

You really don't. And the only reason I was saying it is if you thought there was some way. Because I'm thinking, this, my dad, this is eroding our relationship. If there's some way that I feasibly can kind of take this into my own hands, that's something I would do. But you don't have to. And it's not to say that it would even.

[A]

And you don't until you don't have a car payment and you have an emergency.

[C]

That's right. That's right.

[A]

And have a baby. You know, you got three things going on here that need money long before your dad gets any. So. Yeah, I just want you. I want to set you free from his guilt trips. He's not very honorable to do that. It's sad that an old man does that to his kids, his three daughters. And they do it all the time, though. And he's playing victim. He's playing victim for a trip he signed up for.

[C]

But the learning from this way since.

[B]

Since he took it out, it's been.

[A]

His way since he every. It's other. It's all in all other parts of his life, too. You're not the only place that he blames someone else for his own stupidity.

[C]

But the learning that you can take from this today is don't be him. Don't be him. So you today have a situation that you need tending to, which is your own finances. So that when your baby gets old enough to go to college, you're not taking out, you know, parent plus loans. And so that when you're that age, you can look up and feel good about how you've managed your finances instead of pulling load off and blaming off on everybody else. So this is your learning from this.

[A]

So number one, if you never pay it back, that's fine. Number two, definitely don't pay it back until you don't have a car payment. Deliver this baby successfully and have more than $3,000 in an emergency fund. Okay. You need a three to six month emergency fund. You need zero debt except your house. And then if you want to save up 12 grand Additionally, you and your husband agree on that. You do that in your budget and you want to throw it at them, that's a gift, that's fine. If you never pay him, that's perfectly okay with me. I'm really good with that.

[C]

Me too.

[A]

The only reason I would have you pay him is for you, not for him. He is not deserving. I'm pretty disgusted with him right now. So, I mean, I can't imagine, I'm 64, looking at my grown kids in their 30s and going, I mean, what a wuss. Unbelievable. My kids would look at me and go, who are you? You know, and because it just wouldn't happen. I don't know whether it's hillbilly honor or what it is. I just have too much pride.

[C]

Yeah, that's what I'm wondering.

[A]

On your kids, it's a lack of honor. It's just a problem. So I just, she, we got a manhood crisis in America. Open phones at Triple 882-55-5225. You jump in. There's one way to solve all that. By the way, no student loans.

[C]

Yeah, how about that?

[A]

How about looking at these three girls when they're 17 and go get a job and go to community college.

[C]

Go to a state school.

[A]

Hello, you can't go over there. You can't afford it. We don't have the money and I'm not going in debt. You're up a creek, kiddo. You're going to have to figure it out. That. I like that answer.

[C]

I do too. Parents are not required to pay for college and they're certainly not required to go into debt for it. But you are required to have a conversation early on about what the expectations are. And the expectation is there's no debt.

[A]

Yeah. So go to a school, you can afford that. We'll help you when we can. And that you can work while you're in school, by the way, it's not child abuse. And you can get some scholarships and you can go to a state school because nobody really cares where you went to school. All they care is you actually learn something. That's all they care. You never hired a doctor based on where he went to school. Why? Refi Refinances Delinquent private student loans for struggling borrowers. Learn [e-mail] Ramsey.