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Author: rah1420 Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 308363  
Subject: Re: Me vs. My Parents $40K Debt (Long) Date: 9/6/2004 7:29 AM
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"Give a boy a fish and you feed him for a day; Teach him to fish and you feed him forever."

To your aphorism I rejoinder with one of my own: "You can lead a horse to water but you cannot make it drink."

I think it's admirable that you're taking all this time to educate and enrich your parents -- sort of a Fool evangelist -- but are they going to listen? Are they motivated? Overspending and not LBYM and all the other things that we've embraced need to be internalized in your parents otherwise all the work you've done will be for naught. Imagine, if you will, that the work that you are performing akin to pushing a rope. Ain't gonna happen. :)

Too, you've given a 10,000 foot view of the overall financial situation but you haven't gone into detail on the income and expense situation. With parents that >< close to retirement, I'd be darn leery about doing ANYTHING to upset the pension applecart, even a secured loan with the pension as collateral.

If you have spent a long time on the Fool you know about the snowball. How much of your parents' income is devoted to servicing that consumer debt? How much can they snowball? It takes a surprisingly short amount of time to knock it down if you can begin LBYMing and paying it off in an accelerated fashion.

B-mod is probably not going to happen if you simply throw a huge chunk of cash at the debt and cut out the credit facilities. (All I'll say is "Been there, done that.")

All you've done is relieve the major symptoms, but the "disease" can still be there. And if your parents are seeing fixed incomes on their horizon this can be a much more valuable lesson to learn right now, that to live on a fraction of what they take in. It will stand them in good stead and they'll have the satisfaction of knowing that they did it themselves rather than having it done for them.

Hope I didn't come across too critical. It's a great idea, but I would counsel you to focus your energies towards other ways of attacking that $40,000 nut. Leave their pensions be.
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