1,500,000 advise (father loves debt)
- Thread starter muiris
- Start date
revelationdaily
New member
@muiris This is a usual case of a mismatch between one’s values and wealth principles.
He values hard work pero it doesn’t align with the proper use of debt, which is probably the reason why he hasn’t built enough assets so he can comfortably retire.
Try to have a conversation with him how he acquired such mindset.
Also try to frame the conversation around loss aversion and opportunity costs. He’s 55, is it ok to lose his savings to pay his debts if he gets sick? Is it ok to lose 240k (16% of 1.5m paid in interest)?240k could have been saved for other goals, where else can he use it if ever?
Instead of prescriptions, listen more. Kasi no parent wants to be told of what to do and how to think by the person he raised. Let him discover the consequences of his mindset especially if retired na sya and he can no longer earn 400k.
He values hard work pero it doesn’t align with the proper use of debt, which is probably the reason why he hasn’t built enough assets so he can comfortably retire.
Try to have a conversation with him how he acquired such mindset.
Also try to frame the conversation around loss aversion and opportunity costs. He’s 55, is it ok to lose his savings to pay his debts if he gets sick? Is it ok to lose 240k (16% of 1.5m paid in interest)?240k could have been saved for other goals, where else can he use it if ever?
Instead of prescriptions, listen more. Kasi no parent wants to be told of what to do and how to think by the person he raised. Let him discover the consequences of his mindset especially if retired na sya and he can no longer earn 400k.
@revelationdaily These are good ideas that I can include with my further discussiona with him.
Thank You ka reddit
Thank You ka reddit
revelationdaily
New member
angie197167
New member
@muiris Hi OP, if hindi na talaga mapipigilan, maybe look for loans with a lower interest rate if you can. Then look for alternative things/projects that will make him work harder nalang after. I get u op, i finance my dad sa farming nya, nandun lang yung funds, but i let it lang kasi baka manghina kapag walang pinagkakaabalahan. Its the things we do for our loved ones op haha.
@angie197167 Thank You kareddit for pointing this out. This is what some people are mussing out that old people, lalo na those who were really bit exposed to financial management are very hard to oersuade, to the ooint that sometimes mitigation is the only key.
illustratus
New member
@illustratus Actually this is my next study plans 
@muiris At his age it's hard for your dad to change. Why don't you convince him to have a smaller loan with a longer time? Like instead of 1?5M how about just 1M or even 500k for a longer time? The only point is for him to have a loan so make that loan smaller but with larger tenure so he thinks he always has this loan he needs to pay off every month.
Tbh my office mate did that too, di sila makasave for their children they took a loan and just invested that amount and then they pay the amortization every month. It isn't that efficient money wise but it's either that or they don't have any money set aside for their children.
Some people just have hang ups or mental blocks. If that loan makes your dad work harder and as long as your net every month more than makes up for it just take it as a small loss and move on.
As for where to put it in just keep it somewhere liquid cuz if your dad loses his job you will need to pay back that loan. I'd keep it in short term time deposit like GoTyme or just keep it in digital bank like Seabank. Don't use it for a house or business cuz you might need to pay back the loan.
Tbh my office mate did that too, di sila makasave for their children they took a loan and just invested that amount and then they pay the amortization every month. It isn't that efficient money wise but it's either that or they don't have any money set aside for their children.
Some people just have hang ups or mental blocks. If that loan makes your dad work harder and as long as your net every month more than makes up for it just take it as a small loss and move on.
As for where to put it in just keep it somewhere liquid cuz if your dad loses his job you will need to pay back that loan. I'd keep it in short term time deposit like GoTyme or just keep it in digital bank like Seabank. Don't use it for a house or business cuz you might need to pay back the loan.
endtimetcc
New member
@endtimetcc Thank You I am going to lay down the better options for him
@muiris Not all debt is bad debt. You can’t also force your dad to control how he spends because it’s HIS hard-earned money. It’s his right. With the principal amount of the loan, it’s not that bad either. You see a lot of people in this sub, myself included, not wanting parents to control their financials and same can be said vice versa.
My personal suggestion is to find a middle ground. Propose to him to take a debt that could be considered good. Propose investments that have better long-term returns, etc. business is also very risky if you can’t dedicate full time to it. I would place it in low-risk investments tbh especially since he’s growing old.
Otherwise, accept that it’s your dad’s money and he can spend it any way he wants. In any case, you can think of it as a Php 240,000 expense to have continued motivation which is priceless imo.
My personal suggestion is to find a middle ground. Propose to him to take a debt that could be considered good. Propose investments that have better long-term returns, etc. business is also very risky if you can’t dedicate full time to it. I would place it in low-risk investments tbh especially since he’s growing old.
Otherwise, accept that it’s your dad’s money and he can spend it any way he wants. In any case, you can think of it as a Php 240,000 expense to have continued motivation which is priceless imo.
@onlyway019 This is true.
Since hindi ko na mapipigilan father ko on taking the loan as his motivation im just viewing it as a cost thst I can minimize by either:
Since hindi ko na mapipigilan father ko on taking the loan as his motivation im just viewing it as a cost thst I can minimize by either:
- Look at banks that can offer lower rates
- Minimize the interest by reinvesting