My Mother!
Not too long ago I was debating on what do do with my economic stimulus check should I get one. Well, just in time, $600 showed up in my bank account on Friday.
When I gave a $600 check to my Mom on Sunday she said it was “the best mother’s day present I could have given her (besides spending time with her”.
Anyway, thanks to everyone for your input, but this was definitely the right thing to do with the extra $600. My mother plans on putting it in her savings account.
It was actually perfect timing because she’s been more stressed about money lately and whenever she is stressed, I get more stressed. Since It’s partially my fault she doesn’t have as much money as she needs (there are other factors as well), I feel terrible whenever it’s upsetting her. So giving her the extra $600 was the right move!
What has anyone else done with their stimulus rebate checks? (one interesting note: in my bank account the $600 shows up as a “TAX REFUND US TREASUR”. I thought it was a rebate)
{ 11 comments… read them below or add one }
way to go! Great! best wishes to your mom.
I live in mexico city so no check for me
Yay! Good move. Reducing stress is the best. We didn’t do much with our money. It went into savings. I did buy GTA4 this week though, so I guess you could say it went to that. That’s more fun than saving! =)
Well that’s a great mom’s day gift.
I’m too poor to get a rebate check and I seriously could use the $ now.
Good going Debt Kid!
You did the right thing — I know there are many things you want to do right now (i.e., building your business, building your personal savings/investment account, paying off those debts not included in the bankruptcy process, such as your student loans), however, the BEST thing you could do for yourself, your mom, as well as the rest of your family, is to make things right with her above all others.
I’ve asked this before and am suggesting again that you provide us with a new detailed accounting (spreadsheet) of those remaining after the bankruptcy with balances and interest rates.
The money you owe your mom has no interst rate – I know it is the biggest thing that needs to be paid back, wasn’t in excess of $100,000? The student loans have an interest rate attached and I think your debt for that is approximately $40,000…. then, of course you’ve got your IRS debt.
Because your student loans are over $20,000, you can go with an extended repayment option for 20 years – this option starts with low monthly payments that increase over time… the best part – the first few years what you are paying is interest, which is tax deductable.
Do what you can to pay the absolute minimum on all outstanding debts and focus your largest repayment effort towards those funds that need to be repaid to your Mom. As you said, she’s in her late 50s, and the $$ she provided you was approximately 1/2 her net worth. She’ll be approaching retirement within 10 years – make it your goal to have the entire $$ repaid to her within the next 5. Do as much as you can to repay as much as possible as soon as possible so that she’ll be able to reap the benefits of compounding interest.
Hopefully your mom enjoys good heath. My mom did until she was in her mid-60s, when she was diagnosed with Parkinson’s — her care costs in an assisted living facility were significant. Thank goodness my dad planned for their retirement and she was able to live in a nice facility with fantastic care providers. This was not cheap – when the time comes, if your mom needs to live in an assisted living facility (a small unit with basic services), the monthly payment will be approximately $4,000 p/mo…
Once again, I don’t mean to be a broken record, I just want you to understand fully that above anything else, repaying your mom should be priority number one. If it means you need to take on a part-time job, do it.
And one final thought, if you and your mom (parents) and siblings have not discussed it, you should discuss estate planning. The honorable thing would be for you not to inherit any of your mother’s estate until your debt to her is 100% paid off. This should be written in legal documents, discussed and understood by everyone in your family so that there are no surprises or bad feelings. This was not done in the case of my brother who received $$ for a down payment on a new home almost 13 years ago… he had plenty of time to repay my parents but didn’t do so. So, in addition to the interest-free loan, the $$ my parents provided him and his wife gave them with the ability to purchase a home for $198,000… which at the height of the RE market (Bay Area) went up to over $740,000… While the home now has a market value of only $600,000, none of my brother’s own money went into the purchase of the home. And, of course, over the years he refinanced and took out HELCs to buy new cars, a new sail boat, major home improvements.
In my opinion, my brother got his inheritance early. My sister who is administering the distribution of the funds feels differently and is splitting the $$ equally – all because my mother wrote that the loan “may be” be paid from his share – not “shall be.”
I’m on board with the “Great Move” sentiments. There is nothing like being able to pay back family debts. Anyone who has ever been there nows how much stress it takes off the family relationship once that money is paid back.
That’s good you gave the money to your mom. This stimulus check IS a refund of taxes we would normally pay for 2008. So instead of having to pay this money for taxes this year, we get to keep it. Lower taxes means more money for us and less money for the government to waste.
Good for you! IMO, that was the best thing you could have done. The fact that your Mom was so thrilled with it proves that. So did you also give her the $400 for the month? I hope so! Any idea how much you have already repaid her?
Great choice! I am sure she appreciates it, and I think it was the right thing to do. Win-win!
@ Kim L – Yes, the $600 was on top of the $450 already sent for May. I’ve budgeted $450 a month, though eventually my goals is to get up to paying back Mother at $1,000 a month.
mine payed for repairing the 4wd on my truck… grrr
since u are sorta cash strapped, i dont think u had to give her the entire 600, u could have given her half and spoil yourself with the other half… but anyway it was a nice gesture from you….