How to Ask for Student Loan Help From Mom and Dad Without Ruining Your Relationship

how-to-ask-your-parents-for-money

Student loans have become an unfortunate part of your routine. Another month, another payment. After thinking about options for financial help, the most obvious answer hits you — maybe your parents can help.

But is it the right thing to do? Money can be a touchy subject and you may wonder how to ask your parents for money to help out with your student loans.

Here’s what you need to know when asking for financial help from parents and what things to consider beforehand.

What to consider before asking for financial help from parents

Money can be a sensitive topic and now that you’re a full-fledged adult, asking your parents for money can be tough, embarrassing, and awkward.

Before asking your parents for money, first consider their financial situation. You may want to avoid asking for help if:

  • Your parents have their own debt
  • Your parents’ income is lower than yours
  • Your parents are behind on saving for retirement

If you think, given your parents financial situation, that they might be able and willing to help, it doesn’t hurt to ask. If they agree to help out financially, it’s crucial to come up with a plan together that works for both parties.

Having the talk: how to ask your parents for money

Pick a good time to talk to your parents about your situation. If possible, strive to have the conversation in person. Be honest with them about your situation and ask politely if there’s any way they would be willing to help out financially with your student loans.

At this point, the ball is in their court and you should await their response.

If your parents are open to helping you out financially, here are some potential ways they can do so:

  • Your parents agree to cover a one-time payment
  • Your parents help you with a portion of your student loans each month
  • Your parents give you a no-interest (or lower interest) loan to pay off your student loans

Adam S. Minsky, a student loan lawyer based in Boston, noted, “A lump sum gift/payment could work for relatively small loan balances, but there might be tax consequences for larger gifts, so parents will want to consult with their tax advisor.”

In addition, a no- or low-interest loan could help borrowers who aren’t eligible for traditional refinancing. Minsky explained, “A parental no-interest loan can be, in effect, a refinancing program for a student.”

You may also want to consider the logistics of receiving financial help from your parents. Will they help out via a check or will they make authorized payments through your loan servicer?

The latter option may be best to ensure that the money is being used toward student loans and nothing else.

But before you eagerly say “yes” to any financial help from the ‘rents, consider these questions first:

  • Is it a gift or a no-interest loan?
  • Are your parents expecting something in return?
  • Will this financial help motivate you to keep going or will it be a band-aid on your progress?
  • Will it negatively affect your parents financial situation? (such as retirement, savings, etc.)
  • Will your parents be subject to a gift tax?

Answering these questions is an important part of the process, ensuring that you’re all on the same page. If there’s any confusion or miscommunication, it could cause unnecessary friction between the people you love the most. #notworthit

“People should consider the family relationship as well – owing money to your mom may be better or worse than owing money to a bank, depending on the relationship,” said Minsky, adding, “but it’s certainly going to be different, and everyone involved needs to be aware of that.”

Your parents could also just flat out say “no,” which you should be prepared for. If that’s the case, don’t harbor any ill feelings or ask why. Instead, you can look into other options such as an income-driven plan.

Pros and cons of asking your parents for student loan help

If you’re curious how to ask your parents for money in order to pay back your student loans, clearly consider all the pros and cons before asking and before agreeing to any financial help.

Pros:

  • With your parents help, you could end up paying less toward your loan.
  • You could get a more affordable loan from your parents, saving you money on interest.
  • You could free up some money to pay bills or save for other financial goals.
  • You could shorten your repayment time and get out of debt sooner.

Cons:

  • Depending on your relationship with your parents, owing them money could make your relationship worse.
  • You may put your parents between a rock and a hard place financially — some parents want to help and may say yes even if it’s not in their best interest.
  • You may feel like a child getting help from your parents.
  • While extra help can inspire you to get out of debt, it could also make you complacent.

Final Word

If you’re wondering how to ask your parents for money, use this guide as a point of reference before moving forward. Think about all the pros and cons and make sure you and your parents are very clear about expectations, as well as whether providing you help makes sense for them financially.

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Published in Financial Tips, Pay Off Student Loans, Student Loan Repayment

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