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Color of Money: Don't enable bad money habits

You've probably heard "to whom much is given, much is required."

But when is the much you're giving too much?

I received a plea from one single woman who felt guilty because she's decided to cut off her family from her bank account.

. The background: The woman has been lending money to her parents and a brother. "These family members haven't lost jobs," she wrote. "In fact, they have been gainfully employed during the whole meltdown. There has never been a time when they were not employed. How many people can say that?"

She's tried to talk to her family members about getting credit counseling, but they haven't been receptive to the advice.

. The conflict: The brother and parents spend more than they earn.

"They were so sloppy. They had no clue when I asked them what their total outlays were, where ?the monthly money was going, or even what their credit card total debt was."

The woman asked her brother and parents to produce a budget she could examine. "With the brother, he did humor me through the exercise of writing out all monthly outlays (not a budget, mind ?you, a snapshot). I gave him pointers of what must go."

One was his "gas-guzzling" leased car. She suggested the brother purchase a used, fuel-efficient vehicle at the end of the lease. He did buy a smaller car. However, he also bought the gas-guzzler after the lease was up. "The point of the exercise was to dump the leased car and drive the cheap miser for a few years."

Then there are her parents, who by the woman's estimate spend 10 percent to 20 percent more than they earn each year. They make up for their shortfall by using credit cards and pulling equity out of their home. "Well, the house equity is tapped out, their credit card balances are high, and now they need money for house repairs," she wrote. "Honestly, I think they are close to insolvent, but my dad refuses to do anything about it."

Her father wasn't open to any budget changes. He wanted her money minus the commentary, she said.

. The bottom line: If you're going to bail out relatives, don't belittle them, assume the role of a parent, or worse, allow them to continue their bad money management by rescuing them on a regular basis. This woman was guilty of all three behaviors.

If you decide to give money to relatives (never lend money to family or friends) and you have better budgeting skills than they do, then I think it's OK to make the gift contingent on the person demonstrating that he or she won't waste your money.

But don't treat grown folks like children. They don't have to take your recommendations. If they choose not to show you a budget, share their financial challenges or seek professional help, then tell them you can't help. And mean it. If you give them money even grudgingly, you are part of the problem because they won't change. They won't learn to budget. Why should they? You keep bailing them out.

Never lend money to family or friends.