My mom is bad with money. How can I help?

Q. My mom has never been good with money, and she spends and expects me to bail her out. More recently, his basement was flooded. She signed contracts with two companies to carry out the work to the tune of $ 20,000. The job needs to be done but she has no money. I’m furious that she signed without asking me first. I can either put it on credit cards, use my HELOC, or borrow from my 401 (k). What should I do?

– try to help

A. It is a difficult situation.

But it’s not good for you or your mother.

First, let’s talk about paying to have the basement repaired.

Start by seeing if it can be covered by insurance, said Jerry Lynch, a certified financial planner at JFL Total Wealth Management in Boonton.

“In some situations, this may be considered a covered expense,” Lynch said.

Then see if she can fund it herself.

“Looks like she owns her house,” Lynch said. “Can she do a home equity line of credit or possibly a reverse mortgage to potentially pay that expense?” Are their financing options available from the companies doing the work? “

Lynch said it was better for her to take the financial responsibility.

But if it’s up to you, he said he generally prefers a Home Equity Line of Credit (HELOC) over a credit card for several reasons: You’ll get lower interest rates, HELOCs can. be tax deductible and it will look better on a credit report.

“I cannot stress this enough. If your mom never suffers from her financial decisions – like having to pay it back – she’ll keep doing the same things over and over again, ”Lynch said. “She needs to understand that you are not responsible for her debts and if she makes bad decisions, she will suffer the consequences.”

“You have to have the ‘you have to see Jesus’ talk, saying it’s not okay and you don’t pay for his expenses,” Lynch said.

Email your questions to [email protected].

Karin Price Mueller writes on Bamboo column for NJ Advance Media and is the founder of NJMoneyHelp.com. Follow NJMoneyHelp on Twitter @NJMoneyHelp. Find NJMoneyHelp on Facebook. Sign up for NJMoneyHelp.com‘s weekly electronic newsletter.