How To Help Your Kids (Without Going Into Debt)Aug 15, 2018
You love helping your grownup children. But at what cost? This was the focus of our recent podcast in which our Licensed Insolvency Trustees (LITs) discussed the great lengths that parents are going to in order to help their grown kids (and their grandkids) – from putting off saving for retirement to neglecting to focus on reducing their own debt.
Check out these highlights from this podcast episode:
Grandparents are spending big time
According to a recent US study, grandparents with millennial kids are spending an average of $2,383 US each year on things like gifts, outings, post-secondary savings, school supplies, allowances and extracurricular activities for their grandchildren. And grandparents are also giving their time — over half of millennial parents are receiving help from their parents with child care and household tasks.
Don’t forget your own financial goals and obligations
If you’re offering financial assistance to your millennial kids and your grandkids it may be tempting to forgo your own financial goals and responsibilities. While certainly a nice intention, remember that you have a shorter window than your children to deal with and reduce your debt load, pay off your mortgage and put money away for your upcoming retirement.
A few important questions to consider
It can be difficult for older parents to determine whether they are helping out too much (and putting their own financial health in jeopardy). If in doubt, ask yourself a few important questions:
- Is your financial plan in order?
- Do you have debt that you’re still paying off?
- Will the time or money you’re giving to your kids or grandkids affect your ability to meet your own financial goals?
- Are you dipping into your retirement savings (or putting off saving for retirement)?
If your answer to any of the above questions is “yes” it’s important to know that there are other ways to support your adult kids and your grandchildren. Listen to our podcast for some valuable advice and tips from our LITs.