Should I Forgive the $28K My Bankrupt Parents Owe Me?

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Dear Penny,

I lent my parents about $21,000 about eight months ago, and another $11,000 about four months ago. The $21,000 was supposed to be “long term” to help my parents consolidate debt (about two years in my mind), and the $11,000 was supposed to be for one month. They’ve repaid $4,000, but nothing since the second loan was made.

My parents had just finalized a bankruptcy less than a year before the loans. I knew they could use the first loan, and the second one helped my dad put a down payment on his new sports car. Our last discussion was about my parents reaching into their retirement savings in 2022 to repay me the outstanding $28,000. I know that income has been inconsistent for them. My dad is 73 near full retirement, and my mom is 57 working hourly part time.

Now here’s the twist: I don’t need to be repaid. I’ve done very well financially especially during the pandemic, working my two adjunct professor jobs and starting my own very profitable business.

So I was wondering if there was some way to give a financial “Thanks!” to my parents for being so great (they really are) while still holding them responsible for the loan in some way. Aside from everything intangible, they also helped me out with a loan to buy my second house, which was repaid as agreed. But I don’t want to make it any easier for them to ask for more money, especially since I was the only one of the three children they even talked to about borrowing money.

They do intend to repay the loans, although they appreciate the flexibility I have. My mom is especially adamant after the second loan. They have no idea I’m even considering any alteration to what we agreed upon.

If it matters, should the loan be repaid I’d probably just put it in my own retirement account. And aside from student loans, I don’t have any debt, personal or business.

-Financially Flexible

Dear Flexible,

You’re already giving your parents a nice financial “thanks” — whether you…

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