Updated on 05.29.07

The “White Sheep” Syndrome: What To Do If You’re The Only Financially Sound Person In Your Family

Trent Hamm

About three weeks ago, I had a long conversation with an old family friend who finds herself in a situation something like my own. In both of our cases, we are earning more than any of our siblings, and in both cases, we are the youngest sibling in a set of them. Since she’s substantially older than I am, I was asking her for advice on how to handle some of the issues that this causes – being the figurative “white sheep” of the family, in terms of being different in a good way.

Let me paint a picture of her for you to see, along with a few parallels in my own life; let’s call her Maggie. Maggie is the youngest of five siblings and her current salary is almost as much as her other four siblings combined. She lives about four hours away from her siblings, who all live fairly close to her parents. She’s about 40 years old. To parallel that with myself, I am the youngest of three siblings and my current salary is slightly more than that of my two older siblings combined; I also live about four hours away from my siblings, who both live fairly close to my parents, but I’m about 28 years old.

Here are a few key differences, however: neither of my siblings have ever asked me for a dime, though I did spontaneously (without request) aid one of my siblings in a serious pinch about a year ago. With Maggie, though, she has had requests from all of her siblings for money, though she said that the requests didn’t really start until she had been making good money for several years and everyone had become used to the fact that she was doing very well, which for me would mean that the requests would probably start a few years in the future.

What lessons did I learn from Maggie?

First, just say no. She loaned money to all of her siblings when they started asking, as she felt it was appropriate because she was in a better financial place. However, none of them ever bothered to pay her back a dime and the requests kept coming. She finally spent a day calling all of them and telling them that she wasn’t “lending” any of them another dime, and this resulted in some serious resentment that is still happening to a degree. Her advice? Never start, and if you have, call everyone and tell them that it’s over. If you don’t, they will “bleed you dry.”

Of course, that doesn’t mean that you should shun them, either. Maggie advises to give on your own terms. She does a lot for her siblings, but only at her own discretion. She has given money to them, taken her siblings and their families on vacation, and other things, too, but only because she wanted to, not because she had to. She’s even been a financial angel a time or two, dropping a cash gift when it wasn’t requested but obviously needed. If they ask, though, she won’t do a thing.

She also suggests angel funds for nieces and nephews. Whenever a new niece or nephew has been born, she has started an angel fund for them that they don’t know about and put in a small amount each month. When will they receive it? It’s at her discretion – she’s bought cars on their sixteenth birthdays, paid for a year of college, and in one case helped by giving 10% of a house down payment. Why? Her family is really important to her and this is a way she can give to them when they really need it without any expectations.

In short, the best way to deal with family financial issues is to give on your own terms and never on their terms. If they ask for financial assistance, just give a very clear “no” and move on with life. If you don’t, they will consistently drag you down.

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  1. There is a pattern in what Maggie does:
    She is helping them out for long term without getting in day to day micromanagement. Maggie can see things differently, which her sibling’s family may not see immediately if they are in difficult times. Some sort of teaching to fish, rather than giving a fish. I hope this positively influences the future generation in her family.

  2. Ronduck says:

    I know the feeling. I’m one of two kids and my 52-year old mother hasn’t worked for the last year now. She has started to look for work, but I don’t know how long until she gets a job and moves out. She has had a few jobs here and there, but she won’t go back into clerical, where she has worked succesfully for most of her life.

  3. Ted Valentine says:

    I wonder how much of the resentment came from an attitude of superiority Maggie gives? Having money doesn’t make a person better than another, or a “white sheep” as you say. If her siblings were frequently asking her for money, Maggie must have given them some good reasons to ask. Makes me wonder how “white” that sheep really is?

    For example, my rich sister had better check with me before giving a car to my child on her 16th birthday. Maybe I’m old fashioned, but you never overstep the boundary of a parent/child relationship without terms.

  4. formul8 says:

    I have watched my mother and father do the loan this from both sides of my grandparents. They still to this day, seek cash handouts. (they divorced, surprise surprise) My father declared BK a couple years ago after he went on a spending spree and ran out of cash. His TWO Jaguars got repo’d and credit cards were horrendous. He even asked ME to co-sign to buy a car. No way…

    His parents both died a few months apart last year and finally settled the estate. He is getting a pretty nice six figure inheritance. I predict it will be gone in a year or two as he is already spending it.

    I will not ask him for a dime of it nor do I need it. From both parents, for that matter.

  5. Brett McKay says:

    I agree with Ted. I don’t think I’d feel comfortable with my children accepting such lavish gifts like a car from one of my siblings.

    Because I’m in school right now, I’ve had family help me and my wife out. However, we refuse to accept from my wife’s grandma. She’s very generous with her money, but then she hangs it over your head as a guilt tool.

  6. Linda says:

    I think it’s pretty offensive to assume that siblings who make less money than other siblings will automatically be asking for money. My brother makes a ton more than me and I would never ask him for a dime. My husband and I may not be rich in terms of money, but we do fine and are content.

  7. Awesome. Whenever my family members ask me for money, I have this whole speech made up about how poor I am, but from time to time, I like to surprise them. A trip to London here, or a beatup car for my nephew, etc. Begging is so unseemly.

  8. Ursula says:

    I agree 100% with Ted regarding checking with the parents first! I am “auntie” to my best friend’s 7 children — the oldest is graduating high school next month and I really want to give him $500 as a graduation present. To me, this $500 is just a small dent out of my savings account, but I know it would mean the world to my nephew. On the other hand, it IS a large gift, so I checked with his mom first to make sure it was OK with her and the dad before I gave him such a gift.

    These same people, the dad makes about 2/3 of what I do per year, but he supports NINE people whereas I only support one (myself). Because I love them all so much (they are like family to me), I’ve offered on occasion to help them out when they need it. They’ve never taken a dime from me. But because of their unwillingness to look at me as a wallet, I will continue to be ready willing and able to help them should they ever need that.

    My own flesh and blood on the other hand, specifically my mother, has a really sick entitlement attitude that I actually OWE it to her to give her several hundred dollars a month, just because she wishes it so! This woman has declared BK and had to sell her house and buy a trailer because she can’t manage her finances. And now she has 5 figures of debt hanging over her head. And she has the nerve to expect me to fork over my hard-earned cash to her. I’ve told her “NO WAY” on more than one occasion. It makes me feel sick and used to know that the only thing my mother sees me as good for is for a financial hand-out. (Ah but I think I’m digressing and ranting now!)

    Anyway … good advice, Trent. Never lend money to family! Especially if they think they’re entitled to it! You’ll never be able to kick them off the teat once you let them latch on!

  9. DE says:

    I think some of the comments assume the scenario to be one where you are extremely well off while the rest of the family isn’t. However, there’s a difference between “financially sound” and “rich” and I suspect the article addresses the former. I can relate to this article because I am sure that while I will never be rich, I would nonetheless experience the problem of dealing with family members who are in fact financially disorganized just by becoming finally SOUND. One commentor asks what Maggie might be doing to encourage family members asking for money as if she might be flaunting a Mercedes Benz or something. But, in my case, all I would have to do to entice family loan requests would be to make the horrible mistake of renting a nice apartment or something. The conflict of loaning (or gifting) out money all the time to pay for every parking ticket my brother gets, or being the bad guy, makes the goal of being financially sound almost more trouble than its worth. Almost anyway. ;)

    Great article!

  10. Rob in Madrid says:

    The problem is once you start giving money it’s very very hard to stop. My wife’s parents made that mistake with her younger brother. It all started with the best of intentions, giving them the older car when they stupidly wanted to lease a car. Then it was letting them live with them cost free (no boundaries were set up regarding rent utilities etc) after graduating from college then after 4 years of living at home they moved out but of course they had no money so they were given a down payment on a house than he quit his job to start one of 4 business that didn’t work out of course they keep borrowing (against the parents line of credit) and have never made a payment. 3 years latter they sold the house to pay off debt. I suggested they pay her parents off first and then declare bankruptcy but they didn’t. Ofcourse that didn’t stop the handouts. It only ended when her parents finally ran out of money. Suddenly he found a “job” that paid a wage.

    The difference with my Dad is compelling. He’s always been there for each of the kids over the years but there have been clear boundaries set up. He’s willing to give you loan (gift?). But it was very very clear it was a one time thing and don’t bother coming back. He once loaned us 5000 dollars (pocket change to the money above) but I also provided him with a plan of how and when I would pay him back including all service charges. When I sent him the cheque I keep hoping he wouldn’t cash it but he did and that’s ok that was our agreement.

    Lest you think that parents are being way too soft the hardest thing is to say no to your children. Surprisingly considering how much money has been given out on my wife’s side it hasn’t caused a family rift. I think part of it is good records are being kept and it will come out of the inheritance if there’s anything left that is. And it isn’t worth getting upset about.

  11. plonkee says:

    I don’t think that I would lend my siblings money. But on the other hand, you never know. I’m sure its true that if you start, you can’t stop.

    On a note not really addressed in this post (p’raps Trent and his friend are too nice), at some point people have to take responsibility for their own lives. And to me, part of that means that if you lend someone money, that doesn’t give you a say in how they run their lives.

  12. Jack says:

    “If they ask for financial assistance, just give a very clear “no” and move on with life. If you don’t, they will consistently drag you down.”

    Wow, glad I’m not your brother. Seriously, if you have a sibling that has a history of being irresponsible, a bum or never pays anyone back, don’t lend them money. But my sisters are wonderful, proud people and if any one of them came to me and asked me for money I would do it in a heartbeat because just by them asking I would know they were in need. Sorry, I would not turn my back on my family.

  13. DavidM says:

    I like Ursula’s take on it. I have one brother & he would gladly drain me dry, while my one sister would be desperate before asking me for a penny. She has borrowed money from me once or twice and did not tarry either time in repaying. The brother on the other hand has borrowed a few thousand dollars from me and has repaid a few hundred. My sister is obviously the one Im more inclined to help. I hate to play the favorites card, but it is more of a trust issue. And it is sad, but I have to ask my sister to never speak to the brother about money I loan her, lest he thinks the “Bank of David” is open for business. And my brother has NEVER asked my sister for money.

    One of the reasons I think my brother came to me so often is I was single at the time. Evidently some people think if you are single, you must not have any bills whatsoever and are sitting on piles of cash.

  14. Chris says:

    I am reading a lot of comments here that are assuming the worst of the “white” sheep. I am guessing that these comments are coming from people who NEVER co-signed a loan for their sibling and then had to start making payments because the sibling decided the loan payment was not top priority, and then to top things off, didn’t even acknowledge the fact that payments were made for them, let alone make any restitutions. I bet that many of these comments may be coming from folks who DON’T have a family member that consistently gets into trouble with money and then expects to be bailed out. Or maybe some of those comments are coming from the financially troubled.

    I didn’t see anywhere in Trent’s post where he said that Maggie felt superior and flaunted her massive riches. In fact I think he said that Maggie tried to stay involved with her family so that she could tell when her help was needed, so that she could step in an lend a hand. I never got the impression that she was just dropping duckets everywhere, I got the impression that by staying connected to her family, she knew when one of her nieces needed some help with college, or helping out with a down payment. I get the feeling from this story, that these siblings would have no issue with their son or daughter getting a car for their 16th.

    My advice is never lend money to your family, just give it to them if you can and if it makes sense to. If you give money to them every time they ask, the requests will come easier for them as time goes by. Also, giving money away is not going to miraculously make them see the error of their ways, so I am sure they’ll get themselves into trouble again. That’s called being an enabler.

  15. cami says:

    I like this post, but I think that you have to be careful not to imply that because Maggie makes more than her siblings, she is more financial sound. There are plenty of articles out there that talk about six-figure family with a ton of credit card debt who are living paycheck to paycheck. I’ve seen this situation play out (the one making less money is more responsible) with my friends and family a couple of times.

    I have on occasion lent money, but I only lend what I feel comfortable never seeing again; if I see it great, if not I consider it a gift. I would never let anyone in my family go hungry, especially if they had kids, but above that I think that people need to tough it out and get their acts together.

  16. Debbie says:

    I just realized that I make more money than both of my siblings combined, too. But that’s because one is between jobs right now and the other is ten years younger than me.

    My policy is to loan money (if I have it, if it seems like a good reason, and if I can afford to lose it). Then I never loan any more money to that person until that first loan is paid off. I made that rule very clear at the beginning.

    This policy gives me all the advantages of saying no without having to say no. “Yes, I will be happy to loan you that money, as soon as you pay off your other loan.”

    And DavidM, this plan might work for you, too. It would show that you are not playing favorites; the same policy would lead to different consequences for each sibling because of their own actions, not yours. You never have more than one loan out per sibling.

    As a result of this policy, one of my siblings has not asked me for a loan in over a year, another in over a decade. They have managed somehow anyway.

    I do give gifts sometimes, but not based on what people are asking for. I like to subsidize once-in-a-lifetime family opportunities (like when we all went to Disney World) because it’s worth the money to me to be able to have everyone in the family together, even if one of them is poor right now.

    I also like to help when a small amount of money can make a big difference. Like if only you could scrape together the first and last month’s rent for a new place you could move someplace that’s cheaper and close enough to work that you won’t need your car–that’s when I hope I have the bucks to be able to make that happen, even for a sibling who still has a loan out.

    I’ve just this year decided to add a loan-and-gift fund to my budget for just this sort of thing. I’ll put any loan repayments in there (actually, I do still think that both loans will be repaid one day) and may also add a tiny amount myself each month, like $20, that I won’t miss.

  17. Ronduck says:

    I often read that money is the biggest cause of divorce, but this article proves that its actually personal behavior. Keeping your word, living within your means and living up to your responsibilities in life are what’s important. Blaming “money” is just an excuse not admit what is actually causing the problem.

  18. Steve says:

    I have had several good laughs from the comments! And I have learned quite a bit too. Just what I needed. I am going through a transition period of learning not to hand out money… or getting my money back without feeling guilty for taking it back. I have put my plans on hold at several times in order to help my family and/or friends. I have gone through really tough times and still I shared the little I had during those times. Now I see that my only way forward is to let to not do handouts. At first, I thought/felt that I was showing that I cared/loved the person – which I truly did. How do I tell somebody to get their act together? Don’t buy that shirt just coz it is 95% off if you haven’t paid your rent yet? etc etc etc. Thanks, Trent. Thou hast changed my life since I “met” you! (Well, your blog!)

  19. DavidM says:

    Thanks to Debbie for her comments. I think the method you describe is probably the best scenario if you are willing to lend. I don’t want to harbor bad feelings because of money. Life is too short.

  20. reulte says:

    A good reason for living frugally . . . no one expects you to have money to spare.

  21. Julia says:

    I wish I’ve read this entry sooner. I’m also the “white sheep” of the family, except I’m the eldest and I only have one sibling. My sister is an “indirect mooch”. She used to live with me mother, where she had free childcare for her son and rent. She makes a good living but she was always behind on her share of grocery money and expenses for my nephew. Now, she’s moved out of the house, but she left her son behind. She visits her son every once in a while but hardly gives any financial support. We can’t reach my nephew’s father for any help. Somebody suggested that we leave my nephew with my sister but we’re afraid he would be neglected(he’s only 5). Any advice?

  22. Margaret says:

    Julia — if you are seriously concerned that you nephew would be neglected, then you or your mom (whoever is willing), should apply to become guardian of the child. I think if you did, then you would also be entitled to any family allowance or child tax benefit type payments for that child. That would help offset your expenses, and if you were the legal guardian, you would not have to let your sister take the child back whenever she gets the notion that it might be fun to be a mom again. You need some legal advice on doing that, though.

  23. tightwadfan says:

    The saying is true- if you lend money to family don’t expect to ever see it again. I have seen this time and again. The most irritating is when the person who borrowed the money becomes able to support themselves again and buys more stuff without paying back the loan. My brother in law borrowed from his mother to buy a truck 8 years ago. Since then he has gotten a good job, gone on vacations, had a $10,000 wedding, bought a house, and bought a new truck, and still hasn’t finished paying back his mom. We considered giving the money we were giving him for his wedding present directly to his mom but knew it wasn’t appropriate and would just make bad blood between us. Would’ve been nice if we could have…

  24. tightwadfan says:

    Trent, I’m sure everybody here knows not to do this, but it never hurts to reiterate when discussing family finance issues: Don’t EVER cosign on a loan!

  25. steve says:

    I think i’ts ok to lend to family–as long as you and your family members are on the same page and are actually are treating it like a loan. With a repayment schedule decided ahead of time, so the repayment is a monthly bill.

    I would also want some sense of what my sibling’s overall financial situation is. Preferably would like to see their income, expenses, and budget, and how the repayment will fit into that.

    If you’re not comfortable talking about that, maybe neither one of you should be seeking or extending a loan.

    For loans of $1000 or more you can use a service like Virgin Money to set up the loan and even service it.

    I think the problem here is in not defining your roles, then getting stiffed and having hard feelings on one side, then embarassment and alienation on the other.



  26. This is a great article about a very difficult subject. You don’t have to flaunt your wealth for people to think that they are entitled to ask you for money. If anyone, but especially family, perceives that you have more (either because you are single or have a professional degree) you will be asked for money. My partner has no savings to speak of and significant consumer debt because she has given all of her money to one family member and her children. My partner will never be paid back. As a result we have NO joint accounts because I will not allow my labor to be used in such a way. My mother helped my brother out when he was down and out about 20 years ago. Tens of thousands of dollars to him, his wife and children. Her retirement picture is very different today than it otherwise would have been. My mother did help me with the down payment for my first home. I sold the home at a loss, but have offered to repay her. She has asked me to hold off because she may need the money down the road. Some financial planners advocate family banks for such to facilitate lending within a family where everyone contributes. It keeps the lending open and above board. Otherwise lending to family members should be strictly verboten.

  27. Sylvia says:

    This should be required reading for the few who make it into professional sports & suddenly are making huge amounts of money. It is so sad to see how these young people get knocked off course by sudden obscene wealth!

  28. Pottery Lover says:

    I just found this post! Interesting. What I have discovered “being the white sheep” in the family, is that my kids (and other relatives) don’t have a money problem–there is always plenty of money for the things they want–it is a spending problem.
    Giving them money doesn’t help with their spending problem. I have learned the hard way that loaning money to family members is not a loan–it is a gift! So, we don’t loan money!
    If you want a loan, go to a bank or finance company. If I feel like giving a gift, then I give it with no expectations of being repaid.

    We are the white sheep in the family because we control our “outgo,” not because we have unlimited income. If I tried to continue to rescue my kids and other relatives, we would be as cash-poor as them. We learned to live within our means many years ago and just kind of expected everyone else learned the same lesson from being raised with limited income. At first we thought they just needed a helping hand and helped. Now they are worse off for our help as they didn’t learn how to survive on their own.
    It is painful watching them flounder, but we decided we all have lessons to learn–we learned ours about not loaning money and hope they will learn theirs–stop spending on things that don’t keep you alive when times are tough!

  29. Kelli says:

    I imagine this to be more difficult with parents. My parents are now retired and are not out-of-this-world spenders but let’s say are unafraid of debt. I have a fear of this happening to me one day, and how does one say no to the people who raised you and gave you the opportunities to get to the place you are in? Anyway, hopefully I will remember this article if it ever gets to that.

  30. Rhonda says:

    Alot of great conversation.

    I would never ask for money from my sibling, nor can I ever imagine him asking from me. But if he did it would be for a good reason, and I would try my best to help. And, if for some reason, I didn’t think it was for a good reason I would decline.

    I was taught as a child – never, never lend money unless it is money you can throw away. Good advice in my books.

    I have occasionally ran into employees at work who have felt taken advantage of for lending of money. So my piece of advise to myself is: don’t risk the relationship to lend money. Just say no.

    I would be very upset if a relative offered a car or other ‘large’ amount of money to my underage child without discussing with me first. Actually…even to my college aged child. Huge,huge,huge dent in our relationship there.

    That is probably not what happened in this scenario, or course…


  31. deRuiter says:

    The reasons mentioned are exactly why it is a moral crime for Congress to extend unemployment benefits to 99 weeks. As a landlord with many low income tenants, it is amazing how quickly they find a job a week or two before the benefits run out. More than one has told me cheerfully, “Why I get only $20./ less per week with unemployment, and I don’t have communting costs, don’t have to spend my day doing mindless stuff for a boss. Why should I get a job until the benefits run out?” And they are right! The more you pay people not to work, the more they will stay on the dole. Banks are for lending. if a bank won’t lend money to a person, it’s because they think that borrower won’t pay back the money. Why should you then offer to cosign and get stuck for the money? Why lend your hard earned cash to a person who will not pay back what he borrowed? Life is a series, daily, of financial decisions, some people make bad ones and some good. A good decision maker should not feel guilty because they made good decisions. “Should I buy a Starbucks for $5. every day or put $25. a week in a savings account?”, Should I drop out of school and hang on the street corner or graduate?”, should I buy a used car and bank the car payments or buy a new car I can’t afford?

  32. alsowhitesheep says:

    To TedV and others above – obv stability is a mindset – your bitterness oozes through the screen about your “rich” sister. Agreed, big gifts should be cleared with parents but boy, can I see from here how irritated you are that she is stable. Why not have a conversation with her about how she got there, and be honest and giving about what has worked for you etc?

    There are family loans because the person thinks you are the money fairy and then there are loans because all hell has broken loose in someone’s life. If they are family, you already knew what side of that divide they were on years ago!

  33. Lou says:

    No one has mentioned illness as an issue where lending/giving might be an issue.I have a general policy of never lending to family because my father & his brother actually went to court 15 years after a “loan” that was never repaid. I’m not going there.

    However, a sibling had a child with (what looked then like) a treatable drug problem and the teen’s first in-patient stay used up the medical insurance available for such treatment w/o fixing the problem. When a second in-patient stay was advised, I gave my sib the cash. I regret that I did not pay the medical facility directly so i could take the tax break, but thatshort-sightedness is my only regret.

    Subsequently, job loss left the family without any health insurance and I paid for a transitional policy.

    It took about 10% of my retirement savings and didn’t cure my niece, but I did what I could in a heartbreaking situation and know that I regret the lost money less than I would have regretted the lost opportunity to save a life. That it didn’t work out the way we all hoped is irrelevant and so is the money.

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