My Parents Charged Me Interest on a Loan
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It was $3000 in interest on $15,000 over 7 years. Four years in college and 3 years to pay it off. That is more like 2.85% interest.
Exactly! The parents were quite reasonable.
It was 3 years.
@@jimmymcgill6778 They loaned her money for 7 years total, and she was expected to pay it off in 3.
It was paid back within 3 years after graduating. She didn’t say when she received it. It sounds like she received it as a freshman so had it 4 years before making payments.
Ken had 3 Starbucks Coffees before this call he is in 10th Gear
too much
Almost cringeworthy.
20% interest wasn’t too high. It was charged one time not compounding.
Consider that she borrowed $15,000 over 6-7 years. That’s only aprox 3% a year.
The interest rate was very reasonable and likely BELOW market.
how you know it's one time?
@@tkdevlop that’s what she said. Borrowed 15k and paid back 18k for college. $1k interest per 5k borrowed paid back within 3 years from graduating.
Exactly!
@@tkdevlopDid you not understand the video?
It’s not 20%. It’s more like 3-4% annually.
The fact that all three of them dont understand interest rates is baffling
"20%" 😂
“20% interest” not a 20% interest rate
We borrowed money from my in-laws twice. Both times my father-in-law charged us a low interest rate and actually had us sign a note and gave us a repayment schedule that he had printed out. I really appreciated the way it was handled. I knew this was serious and I treated it just like I would treat a loan from a bank. I knew I was expected to pay it back on time and we always did that. Because he approached it professionally we never took advantage of the fact that he was family and we made sure we were on time every month until it was all paid back.
That's exactly how my father used to do when we were young & wanted to borrow money. He wanted us to learn how the world worked. If more people learned this when they were young they might not have so many money problems going forward.
@theburnetts I find it interesting how some people appreciate it while others don't. I lent my parents 80K for one year so that they could close on their new construction house, and charged them 1% interest to qualify this as a loan for IRS purposes. They paid it back to me 6 months late because the builder had delays (it was happening during the wood shortage in the country). Because of this I missed out on an opportunity to buy a condo, which then rose in price by 60% and caused it to become out of reach for me. I am still hurting because of it, but I am happy that my parents got what they wanted. Btw, they didn't like that I put a loan agreement / note for this, and felt that I didn't trust them.
@@onionpeeler2023 Yep. Every family is different and people can all have different expectations. Lending and borrowing money within a family is definitely tricky and not for everyone.
@@onionpeeler2023- OMG! $80K? I would feel incompetent if someone asked me for $800 (parents included).
Lesson: DO NOT assist someone with something you don’t have yourself.
Damn, you Americans are crazy. Ask interest to your own child? 😅😅😅
The parents charged her interest because they withdrew the money from investment accounts thus losing the growth over the period of time of the loan. Also, had she borrowed the money the through conventional student loans her interest would have been much higher. She is very ungrateful.
Gratitude is lacking. She doesn't even understand how ungrateful she is.
I didn't hear that in her question. She said she is "wondering" if they took advantage of and it was useful to hear that she only started wondering AFTER her husband criticized her parents.
@curiouscat3384 if she understood math, she would understand that she was not taken advantage of and could be grateful for what her parents did to help her, help herself.
@@rhondavigil795 And that's where Rachel and Ken failed. Giver her credit for calling for help and they should have slowed down, gotten the facts, and done the math for her. I didnt' know that stuff in my 20's. Her husband is who started all the questioning
She is NOT a victim! Permanent Victim Mindset!
They've been making bad financial decisions and these grownups aren't taking accountability.
I think her parents charged 16% interest which is high..... a bank would have been 6%.
@@Anniefawesome She paid the extra interest for the financial grace option. If something bad happened between her and the loaning bank, she would have went to her parents to bail her out, all they did was offer her financial protection for a just in case scenario. With the bank, if she defaulted, her credit would've been ruined. Pay the parents the interest and keep it moving. Life is funny, she may need to borrow from them again in the future.
@@Anniefawesome 20% over a 3-year (plus time in school 4 yrs.) loan is not high. That sounds like 3-4% annually.
I borrowed my first down payment from my parents at current interest rates. I paid it off in 10 years WITH interest and am SO grateful that they were able to help me avoid PMI.
She got a good deal. My parents gave me a gift when I graduated from college. An interest free loan for my first car, which I made $150 payments per month until it was paid off. The loan was for $7000. I thought it was great and very fair. She got a super low loan rate on an unsecured loan. Her husband sounds like a jerk.
Lmao, I wouldn't call him a jerk. He just has different ideas about how to lend money to family. So does DR, who would've never "lent" the money in the first place. We all have different opinions, and it's really on her to squash her doubt, acknowledge she made a choice, and move on. I'm sure they can/will do things differently with their kids, and that's one of the best pts about growing up.
@@sspann
I agree.
Like I dont think interest should be tied to a family loan, or if it is, as low as possible in case any legalities come of it, like 1%.
Of course it also depends on how close you are with your family I suppose, as dynamics can play a role.
Her husband IS a jerk. Not for the opinion, but for potentially permanently ruin the relationship between his wife and her parents, over something debatable at most, OVER FOUR YEARS! I think the deal is fair at least, considering the interest rate today and they are tight financially. I will never charge my kids interest personally, but I consider myself well off financially.
Good thing she paid up so the parents didn’t have to break her knee-caps! 😂
😅😅😂
I think the parents were trying to instill a sense of responsibility in her.
It’s none of your husbands business. You paid it off a year before you married him.
Husband blasted for sharing his opinion. She’s the insecure one with what SHE thinks after hearing someone else’s opinion. Grow up a little more smh.
They didn't handle this call well. She was not ripped off.
Agreed. This to me was her parents teaching her stuff costs money
Lmao this was a LONG winded “no”
@@rleonekc07they could have taught financial skills with an interest rate and a high one at that. These parents are lizards.
I don't think she was ripped off. However I do have major side-eye for any parent that loans to their child _With Interest_
Not sure what you mean. They agreed with exactly what you are saying. I would have made it shorter and called her out on her bullshit but they e made the same point you did
She's ungrateful. Her parents were teaching her lesson of life and money.
She might teach them a lesson later in life, when they will grow old and need help and she will charge them a "fair rate" of a few thousand dollars for adult daycare. ;) That's not a way to treat your family, unless you do not understand what the word means.
@@user-lm6me2tz9t
Really nothing wrong with using a “family” bank.
Rather pay and pass down wealth within family than outsource to strangers.
You just proved my point that there are no guarantees your kids will take care of you.
But if she does hold that grudge her kids are watching.
Family is fun.
@@user-lm6me2tz9tmy thoughts exactly. At some point they will might need help.
@@blackworldtraveler3711 I come from a different culture and country. I still live in my family house (which I inherited) and took care of my father until he died and now I am taking care of my mother. At no point did my parents took out a calculator and went "well, son, you are costing us X amount of money, time to pay rent and utilities and whatnot".
When THEY grew old and needed me, I didn't take out a calculator and say "weeeell, I am here 24/7 providing expert care, time to pay me as a full time nurse, caretaker and more".
It is not such a novel idea that IF you treat people like family, THEN they will treat you like family too.
When you are a kid/teenager/young adult, you live with your parents.
When your parents grow old, they live with you.
You do not keep tabs.
That's the culture here and that's why we can actually have some generational wealth. I saw that video at Ramsey one day about some parents SELLING their house to their kids, forcing the kids to get a loan. What kind of nasty behaviour is that?
Of course those children would never even imagine taking care of those "parents".
@@blackworldtraveler3711 YT deleted my lengthier response. Anyway, the point is simple, if you treat your kids like family, they MIGHT take care of you. If you treat them like strangers once they are adults, then they will reciprocate that behaviour later. I saw a video on this channel about some parents that sold their family house to their kids, instead of inheriting it to them. Can you imagine getting a loan to buy your family house? That's not a good society for "generational wealth", by anyone's standards. Meanwhile the rich people keep giving stuff to their kids. Funny how if you are rich your parents don't need to "teach you a lesson about money" eh?
These parents are awesome. Kids could only wish to have parents this nice. This lady‘s husband is not very smart.
My dad charged me 6% on a loan to start a business. At the time I was happy to get the money and get the company going. However it "stuck in my craw" that I had to pay interest over time. That was 14 years ago. He died last December. Now that he's gone, things like that are beyond insignificant in my windshield. I would not bring it up to your parents, and I would ask your spouse to support you in putting this behind you and never mentioning it again
Wow, most ungrateful kid trying to change a deal she agreed to.
I loaned my son money, and I charged him interest. I explained to him that I was forfeiting interest that I would otherwise earn and that he had to cough up for it if he was going to borrow cash from me. No problems. He got a "cheap" loan, and I didn't lose out on returns.
Do you think this helped him "step on the gas" so to speak?
The caller essentially paid off her student loans in 3 years, which is pretty uncommon. And I assume this arrangement, while I did think was very strange at first, may have motivated her more than deferred payments and empty promises of forgiveness and blahblahblah that is the norm
Wow. With parents like that, who needs enemies? 😢
@@jacobawojtowicz Firstly, it was a first hand lesson in how interest works, especially compounding interest. Secondly, it taught him that finance costs and it taught him at the same time that savings earn. Interest rates were also at rock bottom when I lent him the money. He was paying me 2.0% above the cash rate on a variable basis.
It was a practical demonstration that the sooner you clear the principal, the less interest you have to pay. I also included in the contract that he was to take on no other form of credit while he had a contract with me.
While he was contracted to pay "X" per month, I firmly stated that I expected him to clear the debt as fast as was reasonably possible for his own sake. He most certainly did that.
He lived like a pauper for 6 1/2 years while he cleared the debt. He didn't even own a car for 5 years of that. He cut his lunch for work and managed his finances to the cent. He's now 26 and has a small mortgage on a quite comfortable apartment in a nice suburb as a consequence of his endeavours. He still doesn't have any other credit aside from his mortgage and he still lives within his means. He recently credited us with the opportunity and the lessons that we gave him. For that acknowledgement, we're going to give him our old Honda Civic when his Mum gets her new car. He still doesn't own a car (or have a car loan!).
Hopefully that answers your question, Jacob. It should also answer sfappetrupavelandrei's question, too. "Who needs parents like that"!!!
Nice! That seems fair, and it decreases resentment if the child takes a bit longer to pay it off
@@jacobawojtowicz My first reply got deleted, for some reason. There were a few considerations when giving him the loan. Firstly, it was collateralised. Secondly, it had to teach him a bit about finance. Thirdly, he had to benefit from the loan, not dig himself a hole. There were a number of conditions imposed.
Yes, I really do think that it helped him "step on the gas". He kept a book on his own progress and could see with his own two eyes that compounding interest works in both directions. He cleared his debt in record time, figuratively speaking, and has put himself in a very comfortable position financially, for his age.
And aside from his current "smallish" mortgage, he's avoided other debt like the plague. He has done himself well. I'm proud of him.
“They charged me 1k for every 5k” no you took 6 years to pay them back what did you expect
Most people's mortgage lenders charge them $2-$3 for every dollar they lent, and mortgages are the cheapest loans anyone can get.
if they funded $5K/year for 3 years, and she paid back $6K/year for 3 years, the parents made a whopping 6.27% per year. She agreed to it up front, and for her husband to claim they took advantage is BS.
Her parents probably had that money invested and were earning interest. It seems fair that she compensate them for their loss of income
This is the problem when people borrow money. They don't understand how it works. Interest is charged...You had your hand out for the money. You should have had a written agreement. They DID NOT take advantage of you. Get over it and move on. They were nice to loan you the money for a low amount. Way lower than anywhere else...
That's usually how loans work 😂
Parents are different. This sucks
@@frankcb11 There are literal IRS requirements involved with loans of this size amongst family. The parents gave their daughter access to a loan with an exceedingly reasonable interest rate. They did nothing wrong aside from raise a daughter who decided to let her uneducated husband attempt to create a rift in their relationship.
@@TMHFalright
@@TMHFalright it’s not as though the parents can’t be added as a sponsor to her college account and still help her that way. Which is handled differently than loan of this amount. I agree that maybe she should let this go. And the loan was to help her the interest is the thing I am just not a fan that’s all. Not saying she shouldn’t repay her loan
@@TMHFNo it's just a cultural difference. In my some families, parents pay for their kids' college. I think most families at least help a little, whether with tuition costs or room and board or whatever.
Anyway every family is different. One side of my family is always 10 min early to everything, the other is always 30 min late. They used to be mortally offended by each other. It's normal to have some culture shock when families merge.
ok in college for 4 years and 3 years AFTER college to pay it off. 7 total years. Ultimately it was about 4.5% interest in reality, not 20% lol. Seems perfectly reasonable in my eyes.
She never said she went for 4 years.
College loans don’t start charging interest rates til after so over 3years that’s over 6% and 7 years ago when rates were 1% that’s wild
@@trvpboifetti5006 Yeah, the caller got a raw deal. Interest rates at that time were less than 5%. The caller paid 14.29%.
They obviously did a good job teaching her about money. She paid the loan back in less than 3 years straight out of college. The best lessons are the ones that require a little pain. She needs to change her mindset
She got a fabulous loan for under 3% interest. They kept it short and clean. I don't see the problem. She can recognize that relationally loaning money to friends & family is a bad idea, but she can't then apply that new-found moral stance at the past and be resentful against her parents for something she agreed to.
The girl doesn't even understand interest and resents her parents because of it. That's just very stupid. Her parents did her something ranging from neutral action to a pretty big favor. If she had a conventional loan her paid interest would have been more than twice as high and she would've had to deal with bank hassle.
They didn’t charge her 20% per year. She borrowed the money at the start of college, presumably, and it was due three years after graduation. Not knowing exactly when during her college she borrowed the money, but it would have been anywhere from 4-7 years total term. The interest rate was not outrageous. We also don’t know the parent’s financial situation.
I wouldn’t loan money to family, but she did take the loan willingly.
Yes so 3k or 18k total is 16.66%, if you assume 4 years of college, so 7 year term, is about 4.5% per year
@@HospitalLocksmithnot even that high actually 1.0265^7 is 1.2 so it’s about 2.65% compounded a bit higher if you consider it was being paid back over the last 3 years
If I were that girl's parents and heard this call, I would give the 3k back and then give her inheritance to a charity!
Lol that would be a real life lesson
Honestly, I wouldn’t charge my kids interest. Just pay me back numerically and I’ll eat the difference. I wouldn’t “loan” my kid money either, but if I had to there wouldn’t be interest involved.
Either way, the terms of the parents loan were likely better than student loans.
The Bible forbade the Israelites from charging family interest.
@@rebeccapiamonte That is where I get my convictions as well.
"Just pay me back numerically" sure sounds like a loan to me.
@@bnations2000 That’s in reference to there being no interest *should* I be loaning my kid money. I wouldn’t loan my kid money.
It's not clear if she took the whole 15k at the start of her college years or it was spread out. Either way, the interest she was charged was probably far lower than what her parents could've made on that money over those years. Her parents gave up thousands in interest just to protect her from the student loan monster... and now she's ungrateful.
Her parents gave up more than interest. Her parents gave up the opportunity to invest this in an S&P 500 fund and make 10% per year on average.
If the parents kept that money invested in SP500 over that time it would have been Worth $33,000... So her parents missed out on $15,000 to give her that loan... They could have stiffed her and she'd still be making minimum payments at 8% interest with a $17k balance.
My student loans cost more then double what I took out in the end. It's disgusting. Wish I'd made better choices.
In this case, why don't you think about how much money the parents would have saved if they never had children? Or maybe nobody should have children and we should go extinct if we care so much about money.
@sfappetrupavelandrei Or... It's perspective to help her understand that she wasn't ripped off at all. It was a much worse deal for the parents in every way, and the daughter ended up better off with no debt. They gave her a 2.5% interest loan for 7 years with zero risk...
The lack of understanding regarding IRS requirements and what interest rates look like over an extended period (not a single year) here are concerning.
What are the IRS requirements?
Yes, IRS will actually impute interest for a cash loan and impose taxes on that amount, whether the lender charged any interest or not.
This comment, 💯
@@cherrypieforbreakfast1499 wonder if the parents reported the loan to the IRS.
She borrowed it knowing the deal, then thinks they took advantage of her because they expected her to honor her agreement. And they are calculating the interest wrong. it was a *total* of 20% over probably 7 years. you borrow from a bank and don't pay anything for 7 years and it will total FAR more than $3k. And sad that her husband is driving a wedge between her and her parents.
Nooooo- she was perfectly happy with the arrangement. Her HUSBAND is the one with the problem and she smartly called in to evaluate who's right or wrong.
Let me guess..... The parents also spent wayyyy more than $3k for the wedding?
Why do people assume the parents have the money available to loan at zero interest. There's the possibility that they had to redraw from their own home loan in order to fund her college.
If the parents don't have the money, then don't give it to the child. What happened with parents giving money without expecting it back?
To me, it seems that these parents were too lazy to actually grow their children in great adults and now they don't have any trust in giving them money. You people are horrible parents.
I would rather get a loan from a family member, with that little of interest. Instead of going to a bank that would charge you way much more.
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They were right to advise that she's only upset because of the husband's comments. However, they handled the interest question ENTIRELY wrong. They failed to realize that $3k interest on a $15k loan over a seven year period is nowhere near 20%. And I do mean absolutely nowhere near that high a rate. Those parents gave their daughter a GREAT deal.
I charge my kids rent once they are over 18 with a steady job. If they are in college no rent is needed. College is their rent. I had one upset, and one was totally fine with it.
I'd like to see them charge YOU for rent and adult daycare when you grow older and need them instead. Let's see you will be upset or "enjoy the lesson in economics" ;) And then people wonder why in the USA old people are just "dumped" in institutions. No wonder at all.
If I had kids I will never do this because that will just increase inheritance tax when I die. They should rather put that money in a tax efficient investment account on their name. If it’s to save for university or a house, even better. Then I can even help them out with matching contributions. Not only it lowers my inheritance tax but also encourages savings on their part. I very much prefer not profiting off kids.
@user-lm6me2tz9t it's not the same at all. Often when people do this it's a .uch lower rent them market value and they have raised their children for 18 years. It's reasonable to try and teach a child to have responsibility and a small step out without having to pay full rent.
@@Sarah-psalm127 Nah, that's just an excuse. If you REALLY want to teach your children financial responsibility why don't you tell them "save X amount of money each month" where X is the "rent" you'd charge them? If your child can save the money, then lesson learned. Why do YOU have to pocket the money your child earns? Care to explain that? ;)
Similarly if you want your kid to become a responsible adult, you have the child help you with the chores at home right? But you do NOT pay for that work because you are family. It is that child's house too.
I did something similar. I have the kids one year after graduation to save for down payment/deposits so that they could move out. They didn’t have to pay rent if in college full time. Partial payment if part time student. They all grew up to be responsible adults living on their own. While I can see from the comments that not everyone agrees with you (and me), I wanted you to know that I agree with you. I came to this decision after meeting my husband and his family. His 35year old sister and her kids still lived with mom. Mom was never able to save because her income alone supported everyone. She is now 75 and lives on social security and still has to pay a mortgage.
My parents did all types of things to teach me financial lessons. They had me pay interest on something (can't remember specifically what) and they basically put it back in a savings account for me later down the road. Which was even nicer, but they didn't have to do that.
If i were the caller, i would've feel grateful about what my parents did to help me... had she took the loan via bank, she would've been charged way more than 3k interest...
She's an idiot. Her parents were helping her bypass the b.s. of a loan system and she's ungrateful. And, teaching the cost of borrowing money.
Nope, real parents give the kids money
@@johndone8045 or don't charge interest. Like certain religious groups do.
Well, you are very wrong kiddo
Actually, $3k on $15k is 20% interest. A quick Google search is showing private student loan rates ranging from around 6% - %17. Now, obviously, we don't know what this lady's credit score/borrowing power was OR what the rates were at the time she borrowed, but let's not pretend the parents did her a 'solid'.
She agreed. Plain and simple.
Also 3k over 3 years is not bad, she’s just angry she wasn’t “given” the money. Hubby sure sounds like an entitled dude.
A proper response would have been “I can’t who’ve yiu parents lent you money” not “interest on lent money, what monsters!”
I bought the family business from my parents back in 2015 for 275k. I had payments of 9 years at 4%. I’m making my last payment on June 1st this year. In total, I paid 325k and the business has doubled in value. My parents could have sold to another buyer and got their full amount right up front. I never felt taken advantage of, because I realized that I was putting no money down. I’m just glad to be rid of the loan and can breathe easier in a few days after the loan is finished.
She was charged 3k interest. It would have been a lot more had it been paid off to a bank probably.
You said, "My parents could have sold to another buyer and got their full amount right up front." True. But your parents could have also sold it to you without charging you interest. Just saying, LOL!!
@@GAFB1122 His parents are not obligated to give him $50k. You're assuming they're very rich and/or have no bills to pay, but that may not be true. The $50k might make the difference between being able to sell it to him vs. forced to sell it to someone else instead.
Why have your parents not given you $50K??
@@SalisburySnake I'm not assuming anything. I proposed an alternative and it is up the person to reply, NOT YOU!!
@@GAFB1122 it's a public forum, dudebro. Why did you not answer my question?
We have payed double on student loans from interest. 3k was a win for her.
😂 as a father I can’t comprehend charging my kids interest
Curious.... if your kids were adults and working, would you let them live at home for free to charge them rent?
@@GAFB1122 with all the tax experts in the comments, that could require taxes too, on the rent paid.
@@GAFB1122 neither
@@mxerb5912 Answer the question!
I think to bring this up now with your parents is going to create extra tension between your parents and your husband, and perhaps yourself! You were happy with the terms of the loan until your husband said something after the fact!
But as papa Dave would say it: "Family members should not borrow from other family members because Thanksgiving dinner tastes different!"
Or just a 3k contribution.
Not 20%. The loan term was over college and then 3 years after. That's
My mom would loan money with interest. Lower interest but fare from her standpoint. She also gave pre-inheritance. One was a lesson, the other was her choice.
Her lessons were based on where we were, how we handled money, and ultimately for our benefit. Lots of pre lessons on how to handle money. Frugal, sales, coupons, negotiating deals. Dad had me pay the bills.
Here's the checkbook. Here's the bank statement. Here's the refrigerator (meal planning and grocery shopping at 16)
Due dates, balances, budgeting. Omitting items from the cart. Fixing broken items, recycle, reuse, repurpose. SAVE and pay cash for something special. Wait for sales. Etc...
Good lessons learned while still in the nest.
I'd never loan my children college money. I'd rather die than do that. I pay, and that's it. She's right to feel like this.
It's an icky situation. The most important thing going forward is discussing with her husband whether or not they would do the same with their kids. The husband is right to say how he felt about the situation. She shouldn't think that this is normal and one day want to do the same with their kids.
I would never charge my child interest.
20% over a 3-year (plus time in school) loan is not high. That sounds like 4% annually.
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You are not entitled to your parent's personal money for your college. Your parents didn't have to lend you any money, they could have invested it and gotten better returns.
She was a young college student. The parents didn't have to charge her interest. It just sounds creepy. She was finishing college. She wasn't a deadbeat. You can tell that she is responsible she paid it back. I wish John Delony could way in on this call. Being to cheap can make your kids not feel valuable. Is the $3000.00 interest worth your child feeling devalue? Dave paid for his kids to go to college. I am sure Ken and Rachel are prepare to help their kids to get a good start. Where the parents not prepare for her to go to college?
I'd watch out for that marriage of yours, not your past loan with your parents. The husband sounds like a drama queen 💅👸
Yeah I'd be like, you agreed to it? OK, done deal.
This is a call Dave should review. The interest rate issue is the main factor. Once she has clarity on that she will feel alot better.
Ridiculous charging your child interest. Pay back the money but going forward you know where you stand with your parents
Exactly. Totally agree. Parents used her to make $3k.
You don't know what the parents' situation was, they could've borrowed against credit cards, or early withdrew from their retirement account with a penalty to loan her the money.
@@InverselyComplicated-ve3ls Then they shouldn’t have done that. She could have just got a student loan instead of them going through all that. They charged her way too much in interest. Shouldn’t have charged her anything.
@@KB-sg7tv
The interest they charged was less than a student loan.
@@InverselyComplicated-ve3ls That’s simply not true. She paid a whopping 20% in interest. That is crazy! I have four student loans, three of them are between 2-3% interest and the last smallest loan is at 6%. Please explain how the caller paid less in interest than that. And it doesn’t really matter that she took a couple years to pay the loan because the student loan issuers also give you flexibility with your payments and allow you to either start paying late or do various income based repayment plans. And I’m not suggesting student loans are good because they aren’t. I’m just saying, she paid TON of interest for a very short time (took only 3 years after graduating).
This sounds like parents teaching their kids the ways of the world (loans) in a safer environment.
Interest is a real thing! It lights a fire under your booty if you realize that the price is going UP the longer you pay. While it isn’t the “sweetest” thing, I can understand why you would do it.
Just like charging rent to a college kid living at home. “Practicing” before the stakes are too high.
When I borrowed money from my dad to attend college in 1986, he charged me 18% interest. We never had a good relationship after that.
It wasn’t 20% interest because it was a 3 year loan. More like 6.6%.
They charged you less interest than inflation. So they lost a good amount of money on your loan honey. I can’t believe the overall lack of mathematical and personal finance skills of people coming out of college these days. The hosts didn’t seem to understand the numbers either. Dave would have set you straight.
This really did feel like a "I asked my parents for a loan, and they expect me to pay it back now?". Realistically everyone is struggling rn but if im being honest, I would much rather pay interest to my family than a bank. At least they can get me a lower rate!
Why is it even a marital discussion? The loan was paid as agreed and she wasn’t married when she made the agreement. He didn’t repay the loan. Not a good sign.
I will never understand American culture in loaning their own kids money. Shouldn’t you just give to your kids if they need it. Whatever I give my kids, I don’t expect a payback
Not everyone can afford to give away $15,000. They probably need it to retire.
It’s unconscionable for parents to charge their kids interest. She could’ve gotten a better rate at the bank. That’s just ridiculous.
She agreed to it. Live with the consequences
Looks like some people just want free stuff. Husband creating unnecessary trouble.
Never loan money to family or friends. Ever. GIVE money with no expectation of ever seeing it again.
This gal knew up front there was interest. She signed up for it. Bad decision for parents to make the loan; bad decision for her to take it. This is why you NEVER loan money to family or friends. "The borrower is SLAVE to the lender." Don't turn your kids into slaves. Don't ask your parents to turn you into a slave. It's just.... not... worth it. Find another way!
Actually, it's the opposite. The lender is the slave to the borrower if there are no enforceable documents.
$15,000 is a lot to give with no expectation of ever seeing it again. 😂
you do realize that verse was written in a culture where all debts actually used slavery as collateral, a practice we don't permit anymore right?
so setting up a loan with someone does not actually turn them into your slave?
and you do know there are lots of verses God commends and expects his people loan and give generously, BOTH, not just one
@@thewheeldeal8439 Do you know that God is imaginary?
@@thewheeldeal8439 yep I'm a history major by training and an avid reader of the Bible and other ancient documents by hobby.
You expect to be paid back when you loan money, right? That takes time, effort, and the sweat of your brow (which I'm sure you realize). So while the word "slave" may not be used anymore... the result is only different in that someone owns a piece of your future, to be redeemed either when you pay it back with the fruits of your labor, or when a judge or court says you must and seizes your bank account, or when inability to pay forces you into bankruptcy, which will make things cost more for you in terms of inability to borrow money cheaply and/or security housing easily.... which costs you more time, effort, and sweat than it otherwise would have if you'd paid up front with resources you already had.
So... yeah, you win on the technical terms, but the overall premise stands. Borrowing money is a contract on your future earnings which may or may not materialize, and regardless of whether they do or don't, someone else has a legal foothold on your life. Slavery by another name, but slavery all the same.
P.S. "Loan" in the Hebrew is used in the same sense as give. Semantics. And I already addressed giving in my OP.
It’s fucked up to charge your kids interest. Not something I would ever do.
You're also a spirit worshipper, so I'll pass on your advice 😂😇
@@sitcomchristian6886 it wasn’t my advise to you. No one cares what you do trust me.
1. It's impossible to get a 4 yr degree for $15k. How much additional financial support did your parents provide for your education while you were in college?
2. After you paid them back, you got married. How much did they pay for your wedding?
There is a circle of life issue that's being ignored...
You were not entitled to a college education, nor to a wedding feast. Plus, I do not know your parents financial status. Bit you have not been harmed. Check your and your husbands entitlement status and grow up.
I guess the caller would have preferred to get the loan via a bank and probably pay even more interest with no leniecy in the event of an emergency.
I wouldn’t say what her parents did was wrong, but like Ken, I personally wouldn’t charge my kid interest.
She needs to be more grateful
She agreed to the terms. Walk it off. Too late.
I got car loan from my parents once. With interest based on average rate at that times. I also had to pay rent and chip in to food the first day i got a full time job.great life lesson and i am very thankfull my parents did that
Loans have interest, this is a fact. If it has no interest, it's not a loan. It's a gift with no incentive to return.
It was not 20%. She didn't make payments for 4 years so the interest accrued.
She was taken advantage of.
Before you get mad at me, the financial aid office at universities clearly state that parents have a moral obligation to help their children pay for college. That is why all students under 25 have to include their parents’ income on their financial aid. That means that the children of wealthy parents don’t get financial aid, but the children of poor parents do. If parents have the means to help their children pay for college, and they choose not to, then legally, in certain circumstances, the kid can sue their parents for assistance, which is what happened in 2013 in the case of Ricci versus Ricci. In that particular case, separate judges upheld the decision siding with the student, both in the original case and the appellate case.
I'm not mad at you, however, I would just point out that the parents did help her. They just threw in a little interest. There have been all sorts of explanations as to why they did that, idk...but it's just interesting that it didn't seem to present any problem until her husband got into the picture & seemed to want to make an issue of it. I find him suspect.
Buyer's remorse. I'd charge my kid also. I'm paying 29.99% on my credit card; 20% is a deal.
@@YourTransmissionRepair you accept paying 29.9 percent from thieves
$15,000 with $3,000 interest over 4 years to 7 years is NOT 20% interest. It is 12% to 3%. The interest rate factors in TIME.
She was an adult who agreed on the terms if she didn’t like those terms she could have went and simply got a regular student loan. Too many people today have to find something to be upset about. I don’t understand this.
The Bible is clear: "it's immoral for believers charge interest to other believers." Kinda includes family.
Nothing wrong charging interest. If they had let her borrow from a bank the husband will not say anything. That’s absolutely not absurd to lend the money and not a problem to charge a very small interest. It was clear and makes perfect sense
She’s a follower not a leader…. Very easily influenced. She was perfectly fine with the deal until hubby opened his trap. He sounds like a shit stirrer.
Nailed it.
"shit stirrer" or maybe she just internalizes every minor comment and let's it build in her head.
She said he made that comment several years ago. She didn't say he talks about it all the time. It could have been anything from "your parents are terrible ppl" to "eh, I wouldn't charge my kids interest".
I asked my stepdad for help with my down payment. He said "ok but I have to charge you 7% because that's what my investments are making." The bank was charging me 3.5% 🤦😆
So no problem.
Why do these so-called experts not understand that it wasn't a 20% interest rate? She sounds ungrateful. In this case, no good deed goes unpunished.
Ungrateful? A little. But I'm gonna go out on a limb and say her degree was in neither math nor accounting. The shame is that Rachel and Ken should have picked up on this math dilemma being the financial "experts" they are. I feel another Dave reaction clip coming.
That's a hell of a deal. They invested in her future for a 2.64% return over 7 years.
You should be thanking your parents for the valuable life lesson. Giving your kids this much money with no responsibility attached teaches them nothing.
Charging interest is a life lesson in how money works. Maybe meet in the middle and charge interest based on what that money would have earned her parents had it been in a savings account during that same time period
parents took a huge risk, they did nothing wrong, they taught her to be an adult. her husband is an ignorant fool trying to divide her from her family which is a very manipulative psychopathic thing to do.
There are also good sides to this since they set a 3 year timeline. If she took a loan from a bank, who knows how many years she would have delayed it like most Americans do and had to pay much higher interest and the stress of the debt? Now she is done and over with it. No more debt
$3000, for $15,000 for 3 years is just over 12% not 20%. Interest math over a loan isn’t the same as straight multiplying.
I've learned not to be judgmental of others, even if they're doing things I wouldn't personally do. After all, I'm not in their shoes, and I've made my own mistakes.
One thing I notice repeatedly is that people (including myself) who are having trouble processing emotions can sound very similar to each other. They tend to ask pointed questions that are heavy in an emotional pretext (which they breeze past). People who are coping well would take the time to explain something like that rather than smuggling their victimhood in with a super specific question.
If the daughter has brothers and sisters, and she was the only one who was given the option to borrow money from her parents without interest, while the other siblings had to take out loans with interest, it would be fair to charge the daughter interest on the loan. However, if she were the only daughter and I could afford it, I would not charge her any interest.
They did her a huge favor and saved her money. She needs to get over herself and her husband needs to butt out.
3 year pay back on $15k is like 12%. If she had no credit better her parents than Sallie at 12%
Her parents were helping her while protecting themselves, very wise parents she has. They teach her how to be responsible with money. Then she got married with a man who has no clue how to raise a responsible child. He should have never say anything. Non of his business, he cost resentment that wasn’t there. And now she has issues within herself.
As long as my kid is a good person and treats me with decency and respect, I would not have charged interest and furthermore regarding the principal amount, the payback would be in grades. The more serious you take college and the better you do, then I'll forgive the amount. ALL THAT WOULD BE STATED UPFRONT!
I was mostly an A student in college peppered with a couple Bs and that is what I expect and demand from my kid. Do that and I'd forgive the principal amount. ---- See in my world, money is not without strings. I get paid but the string is, I must work.
If you were a good parent, you wouldn't ask for the money back at all.
@@davidlloyd1526 You raise your kids as you see fit and I will raise mine as I see fit. Do well, and all is forgiven. Goof off and do poorly and you will pay back every penny. See I am successful, and my kid will be successful.
@@davidlloyd1526 My kid will be successful. Yours not so much.