If you want to provide for your adult kids, you aren’t alone.
A 2015 survey from the Pew Research Center of nearly 1,700 Americans found 61% of parents with grown children had helped them out financially in the past year. Largely, they don’t consider this a burden: 72% feel they’re expected to help their children “the right amount” and 89% find it rewarding.
But are you supposed to feed money to your grown children indefinitely? And if not, how do you know when to stop?
Below, we’ve outlined five signs it might be time to stop sharing, with the help of certified financial planner Katie Brewer, financial coach to Gen X and Gen Y with Your Richest Life.
This article was written by Business Insider without the involvement of Merrill Lynch.
They have a steady job and could pay their bills with a little budgeting.
If your kid could be self-supporting, but isn't, you might want to consider giving them a little shove.
Brewer says she sees parents managing their adult children's money, but there are more sustainable avenues available. 'If parents connected their children with a resource and nudged them in the right direction, it might be more of an opportunity to teach kids to be self-sufficient, versus their parents still doing everything for them.'
She says this nudge could be as easy as showing kids how to link their accounts to an online budgeting tool (Mint and Personal Capital are two popular options), or scheduling a basic information session with a financial planner. 'I've had instances where parents set up a call with their planner and have their adult kid on the phone, and say 'If my child wants to do a starter plan, I'm willing to pay for it as long as they're willing to go through with it,'' she says.
While paying for your child's financial planner is still giving them money, it's also a strategy to make them more financially self-sufficient. 'The parent is paying, but it's a way to be like 'Here's a third party that's going to help you,'' Brewer continues. 'It's not coming from mum and dad, so it's cutting out the relationship aspect, where kids might not want to take their parents' advice.'
You're constantly bailing them out of avoidable situations.
If your child can't scrape together the cash for her student loan payments because she lost her job, that's one thing. If she can't write that check because she bought tickets and flights to Coachella (and Bonnaroo, and Lollapalooza, and Glastonbury), that's a different situation.
'There are some people who just feel obligated to help their children out, because it's family,' Brewer says. 'But you have to know that sometimes letting go of that control a little and letting someone have a few hiccups can help them find their own path. It's very painful, as a parent, to back away, give up control, and say 'I have to let my child have some learning opportunities.'
This might be another instance where your child would benefit from being directed to some resources to better learn how to manage the money they have, such as online budgeting tools or financial professionals.