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The Middle of the Night Call – How to Protect Family Finances When Children Make Mistakes

Accident that could change your family's financial life forever

If your children have reached adulthood, it’s likely that you’ve answered the phone and been surprised by upsetting news about a problem your child is facing. “Mom, I’m in the hospital…in jail…in trouble.” Your stomach turns over; your head starts to hurt; your mind races. How can you help? When that call comes in the middle of the night and involves the police or the hospital, the panic runs even deeper. How can you best protect your child, yourself, and your finances when an emergency occurs?

Protect Family Finances - Medical

Few words buckle a parent’s knees faster than “Mom, I had an accident.” Whether the child contacts you during the incident, later while in the hospital, or after they’ve gotten home, you can mitigate the emotional and financial costs in several ways.

Travel to their location if possible. Some injuries seem more minor than they actually are. If you have the money and ability to get to your child, go in person and assess the situation. It is always better to have an advocate when you are receiving medical care, so if you can get to your child to help, you will improve the outcome from both health and financial perspectives. If you can’t get there, ask your child to fill out the HIPAA privacy forms so that you can talk to the doctors and nurses about the child’s condition. Ask a friend to go if your child is amenable to that.

Encourage or help your child to document the situation. Ask for and collect police reports, medical assistance records, bills, emails, and phone conversations to maximize insurance and other repayments. Keep in mind that once your child reaches the age of majority in your state, you aren’t liable for their medical bills even if you cover them on your health insurance. You may choose to pay their medical bills, but if you don’t and the bills go into collection, it will be the child who is responsible, not you. Regardless, excellent documentation will help bill-payers ensure that they are paying only what is owed, not extras billed by mistake.

Protect Family Finances - Legal

When your child breaks the law, you have less ability to fix the situation. However, you can take some actions that can help.

Get all the facts. My husband and I love to watch old Perry Mason shows from the 1960s. Raymond Burr stars as a lawyer who wins every case he argues. He usually has to convince his clients to give him all the facts, even ones that seem damaging. He tells clients that he needs to know everything that has happened in order to win the case. You need to impress on your kids that they also have to tell you all the facts. If they are culpable in an area that they profess to be innocent, it will damage their case and your ability to help them navigate the law enforcement and legal systems.

Call in favors. If you know any attorneys or police officers, contact them. If your child is physically far away, contact anyone you know who lives in the area. When a child is involved, friends-of-friends, bosses, and tangential acquaintances will willingly step in to assist. Tell them the situation and ask for help and advice. Ask your contacts who to hire and where to go for help. Put aside your pride to manage the situation in the most advantageous manner.

Reassure your child of your love and commitment. You hate the act, but you don’t hate the child. They’ve made a huge mistake, but they are the same person you gave birth to and love. If they did commit the illegal act, you can’t stop them from being punished for it, but you can still love them like you did before.

Protect Family Finances - Alcohol- or Drug-Related Problems

When people are high or drunk, they are not behaving as their true selves. They don’t have control over part or all of what they say or do. The consequences of their behavior are real and must be acknowledged or punished if illegal but remember that the behavior is not that of the real, true inner self of your beloved child. Try not to take things personally.

Legal ramifications. Use the tips discussed above but be prepared for less help and approval to be offered from others. People tend to be less sympathetic when illegal substances are involved. Health insurance may be invalidated, and other types of assistance may be closed to you. The police and other authorities may be involved, and the stigma of substance abuse will make resolution more difficult. Continue to be as calm and professional as possible in helping your child resolve the situation.

Professional help. There’s a temptation, after an alcohol- or drug-related problem occurs, to ignore the underlying addiction and hope it goes away. Certainly, after your child gets into repeated trouble because of his or her addiction, you may need to step away from offering help. And, unfortunately, until a person is ready to work on breaking an addiction, no amount of help or coercion from loved ones will end the addiction. But when the first problem occurs, you have a great opportunity to step in and get the child help to possibly fight the addiction. Try and get your child into a rehab program as soon as possible.

Protect family finances. If your child has an addiction, you need to distance yourself financially as much as possible. If you have them on your auto insurance or allow them to drive a car you own, take them off and help them get their own policy. Depending on the state and the circumstances, you may still be financially liable for a child older than 18 who gets a DUI or runs up big debts, but the more you can do to financially separate yourself, the better. Avoid co-signing loans or allowing the child access to your credit card or bank. Don’t leave money or valuables lying around; addiction is so powerful that children can be driven to steal from their parents and siblings. They don’t mean to do it and they don’t want to do it, but to get the money for drugs or alcohol, they may do it.

Parenthood brings many rewards and some heartaches. Today’s parents are accused of “helicopter parenting” – being too involved in their children’s lives. The fact is that life in 2020 is much more legally complicated than life in 1950. High school pranks, fights behind the school, smoking in the bathroom, playing doctor, and school protests that caused minor heartache in the past now carry lasting legal consequences that can permanently damage a child’s future and a family’s financial security. Being an “overly involved” parent is almost essential to ensure your family’s well-being.


Kathryn Hauer, a Certified Financial Planner ™, adjunct professor, and financial literacy educator has written numerous articles and several books including the “11-Step, DIY, Comprehensive Financial Plan Workbook” and “Financial Advice for Blue Collar America.” She works to help clients and readers understand and act on complex financial information to keep them and their money safe. She functions as a strong advocate and guiding light for her clients as they move through murky and unfamiliar financial and career worlds. Read more on her website.


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