Financially supporting our Children. When does it stop?

It is an exciting day and also tinged with a bit of sadness when our children leave home. Maybe they are off to see the world, heading to university or flatting with their friends.  Does this mean we stop supporting our children financially?  This question can become the elephant in the room for many families.

elephant compressed

The short answer seems to be no we don’t stop supporting them financially!  Among friends and clients it seems many of us with adult children are still helping out in one way or another.

The agreement we had with our children was we would support them during university and after that they were on their own.  Sounded like a really good plan at the time, but over the years it hasn’t quite worked out that way.  The number of parents in the same boat as us seems to be growing.

The old adage of children leaving home at 18 or when they finish their tertiary education and supporting themselves, has disappeared for a high percentage of parents.  We are faced with the dilemma of supporting our children for longer than originally thought.  This can cause friction between the parents.

This story was told to me in a humorous way, but there were serious undertones.

“Our son came back from overseas, no money, no job, so of course we welcomed him back home.  Six months later he is still here, he has a job, but isn’t contributing a penny.

I asked him to pay some rent and his mother shot me down in flames, the agro I got from her just wasn’t worth it.  So I suggested he might like to move out, go and live with his mates, well that got an even worse reaction from them both.  So I just shut up and keep paying the bills….. I’ll deduct it off his inheritance later, if there’s anything left that is.”

We love our children and want to do everything we can to help them.  But at what point do you draw the line and as hard as it can be say “No, you have to stand on your own two feet?”

If only it were that simple!  But it isn’t, because anything that involves money isn’t just about the maths.  It is also about emotions.

I was talking to one of my girlfriends about this very issue.  She has two sons graduating from university this year; both universities are out of town, so the boys have to pay for flights, accommodation and the hire of robes, etc.  Both of these boys are very bright, one is now working full time and has saved most of the money to go; the other is drifting, living in a small town with very little prospect of work, not sure what he wants to do with his life and no money to pay for anything towards his graduation.

Should she pay for the son that has no money to go to his graduation?  What would you do in this situation?

This is what my girlfriend is going to do.  She is going to lend the balance of the money to the son who has saved as much as he can to get to graduation.  The other son, as much as it breaks her heart, she won’t give him the money to get to graduation.  This is one of life’s lessons he needs to learn.  I really admire her for being strong in a very difficult situation.

Here are a few of the reasons parents continue to support their adult children,

  1. You are genuinely concerned about your children’s financial well-being, you can see the ends just aren’t meeting.
  2. You don’t want your children to struggle financially they way you did.
  3. We (often mistakenly) think our children are worse off than we were at their age due to student debt and rising property prices so we want to give them a helping hand so they can get onto the property ladder.

There are dangerous side effects of supporting our children for too long,

  1. Your children don’t learn how to manage their own finances and just assume we are there to bail them out when they strike a financial trouble.
  2. As a parent the sacrifices and money you invest in your children may put your own retirement income at threat.
  3. How do you differentiate between siblings?  If you help one and not the others, this can cause friction within the family.

So do how do you navigate your way around this issue?

The key as with most issues around money is communication.  In a family situation this is often easier said than done.  So here are a few suggestions that may help.

  1. If you don’t feel that you can have the money conversation with your adult children, bring in a financial adviser or third party that can help the conversation stay on track and not get too emotive.
  2. Be clear about what your expectations are.  For example your children move back home so set  some guidelines about contribution to the household and time frames.  They may not be able to financially assist but there are other non-financial ways of contributing.
  3. Be prepared for the discussion to get heated with emotional statements like, “you will never see your grandchildren again if you don’t help”.
  4. Is the financial support a loan or a gift?  Be clear either way and document it.
  5. Don’t feel guilty about saying no.  You have raised your children to adulthood and it is now time for you to enjoy your life once they are off your hands.
  6. Understand what is going on in your head.  Are you feeling guilty, manipulated or are you refusing to let your children grow up?  Take a step back and ask yourself, “if this wasn’t my child what decision would I make”?
  7. Remember you are not alone.  A lot of parents are facing the same situation that you are, so ask for help.

We would love to hear your stories and how you have resolved financially supporting your adult children, so please leave your comments, or drop us an email.

 Lynda Moore  

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