Helping Family Out Financially

I’ve mentioned my sister’s phone bill being charged to me a couple of times on this blog.

Here’s the skinny on that particular scenario.

The main problem is my sister has really bad credit, and when she wanted to get a cell phone for business purposes back in 2001, she asked if I would get the phone for her in my name, and she’d pay the bill. I agreed to do that for her. I acknowledge that part of the problem was an ex-husband of hers, who helped run up their phone bills, using a cell phone. Because of that situation, I was willing to give my sister a chance, since the ex was out of the picture and she was trying to get back on her feet after a rough divorce.

Unfortunately, as it has turned out, my sister is a bit flaky about paying her bills on time. At first, I let her pay the bill herself. I trusted her to pay the bill on time. Then I found out she was paying it late. I complained to her about it, and she’d shape up for a couple months, then she’d pay late again. As you can imagine, I was freaking out, as making late payments to the phone company can affect one’s credit rating. Finally, I arranged to have her bills paid automatically from one of my credit cards, and informed her she would have to pay me directly. She was not very happy with this, as she said it removed her opportunity to be responsible. Well, sorry, sis, but I’m not going to allow you to ruin MY GOOD CREDIT with your flaky bill paying habits. One of her most common excuses was, “I have the money, I just haven’t had a chance to sit down and pay the bill. “ Or, in the past couple of years since I began paying the bills automatically, “I have the money sitting right here, I just haven’t found the time to deposit it into your account.”

Bear in mind that I did not even have a cell phone at the time. However, when we moved out to the country, we decided it would be wise for me to have a cell phone, since the commute is 100 miles round trip. Much of it is through Indian reservation, and barren desert for over 15 miles. When I called to get a phone for myself, I was pleased to see that the plan my sister had gotten in on was available to me as well. The plan had been grandfathered in by the company: 3000 anytime minutes for $49.95/month.

My sister called me last week and left a voice message. She wants to know if I would agree to allowing two of her children, ages 14 and 15 year old, their own cell phone. Using my account. She already called the company to see if they would allow her to keep the plan that has been grandfathered to my account, if she took responsibility of the number. They will not transfer the plan if she takes the phone number over. She says she has explored other options, and she keeps coming back to this one as being the best deal for the money.

When my son needed his own phone, he purchased a pay as you go phone, and 1000 minutes for $100. This was in May 2007. He pays $0.10 per minute, but when you consider those minutes have lasted him for 8 months – the monthly cost is $12.50, as opposed to $50/month if he had one of my plan phones. He just ran out of minutes last weekend. I suggested this option to my sister, but she claims a deal like this would not work for her children.

If my sister was excellent, or even good at paying the phone bill, I’d have no hesitation. But since I often have to float her phone bill for months at a time, I am having serious doubts. In fact, right now she owes me for 3 months worth of her bill, to the tune of around $250. This is an extra $250 that could be applied toward my credit card debt, instead of waiting until she gets around to paying me back.

Will the children be responsible? 3000 minutes is a lot of time, it works out to about 100 minutes for each day of the month. When you go over those minutes, however, the cost is $0.35 per minute. Not only am I concerned about my sister not being able to pay her own bill which runs from $60 to $100 each month, but another $110 on top of that, plus, will her children be responsible and stay under 3000 minutes each month? This plan also does not have unlimited long distance, but you must confine your calls to a “region” which includes a few states near ours. Will they be able to confine long distance calls to the correct states?

I’d like to help her out.

But I’m questioning the wisdom in granting her request. What would you do?

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5 thoughts on “Helping Family Out Financially

  1. I would say no. By this time, she should have enough credit to get a plan. You’ve carried her for a year, now it’s time to make sure she’s responsible on her own.

    If you make that decision, be prepared to write off the $250 she owes you.

    I think this is an instance for “tough love.”

    At this point she’s asking you to pay for her and her kids cell phones. This is the tune of ~$150 a month expenses without guaranteed reimbursement. She’s already 5 months behind @ $50 a month, think of how this will be if she were 5 months behind @ $150 a month!


  2. Hi Zachary, actually I carried her for THIRTEEN YEARS on her land line phone, which she only recently got transferred into her own name (this is because one phone company monopolized the options until the past couple of years). She does always pay, she just waits 2-3 months between making a payment. When we didn’t have any credit card debt, I paid the bill in full. When my cards started piling up, I started passing the interest on to her.

    She’s *three* months late currently (even though the phone is $50/month there are additional charges like taxes, etc., and one month she went over her minutes), and you are right… it’s not out of the question to imagine her being 3 months late for all three phones.

    Thanks for your input!


  3. I think it’s time you went over there and set up an automatic bill pay for her so she can’t just put it off because she doesn’t get around to it. I’m actually in the middle of a class at church for setting up boundaries for children, but they apply to siblings, elders, and peers as well.

    To answer the question “what would I do” it would have to be removing you from the equation for being the middle-man. Take some time to make the transition, help her get going and explain how it’s going to work, but don’t continue being the buffer.


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