Today's Habits Create Tomorrow's Progress

When a 23-year-old college student calls to say her retired parents want her to co-sign a $250,000 HELOC they plan to use to pay off credit card debt, the answer from George Kamel and Jade Warshaw is immediate and unambiguous: "You should [say no]." The caller is living at home, paying $1,000 a month in rent, and watching her parents rack up roughly $800,000 in total debt across two rental properties, a primary mortgage, and consumer cards—while refusing to sell either of their million dollars in real estate. She is worried about inheritance and about her younger siblings. The hosts walk her through the arithmetic: her parents have $1.1 million in accessible equity if they sold just one property, but they won't. "They're going to HELOC their way into oblivion," Kamel says. The hard truth is that these are grown adults making their own choices, and the caller cannot change them. What she can do is stop handing over cash and instead pay the utilities directly to keep the lights on where she lives. More importantly, she should move out. "Dysfunction is magnetic," Kamel warns. She has $60,000 saved, she is 23, and she needs to start her own life on a healthy path.

The Trap of Golden Handcuffs