BUSINESS + ECONOMY
At what age should parents cut off their financial aid for their adult children?
Apr 11, 2023, 9:30 PM
According to a new report, 68% of parents with children over 18 have made some kind of financial sacrifice for their children. This begs the question, when should parents financially cut off their children? (Pexels)
(Pexels)
SALT LAKE CITY — According to a new report, 68% of parents with children over 18 have made some kind of financial sacrifice for their children. This begs the question, when should parents financially cut off their children?
Ted Rossman, Bankrate Senior Industry Analyst, joined Dave and Dujanovic with hosts Dave Noriega and Debbie Dujanovic to share his insight.
Beginning the conversating, Dujanovic asks “What’s causing so many parents to keep making these financial sacrifices for their grown-up kids?”
Rossman said a combination of things cause parents to make financial sacrifices for their children.
Generational differences
“I truly see both sides of this. I do think that it’s harder for young adults these days,” he said. “We’re talking record high student debt burdens (and) much higher housing costs than older adults experienced when they were that age. But then again, you know, we have to be mindful of the other side of this too.”
The other side, Rossman said, is people in their 50s, 60s and 70s who face financial issues.
“[They] maybe under saved for retirement (and) they’re facing high health care costs among other things,” he said. “So, you know, ultimately, my advice comes back to don’t lend more assistance than you can afford to lose and don’t be a blank check.”
Dave said he wonders how the adult children view the situation.
“There were some really interesting takes on this … one that we identified in the survey is generally speaking, gen z-ers think that they should start paying for things two years later than Boomers do,” Rossman said. ” So, in many cases, these are the parents and the adult children. So that’s why we isolated those generations.”
According to Rossman, Baby Boomers think a person should start paying their own phone bills at 19, while Gen Z thinks it should be 21.
“You know, I think the other big thing here is if you are a parent and you offer so much help that you’re depleting your own retirement savings or your own financial situation, are you going to have to ask your kids for help down the line,” he said.
He advised that families should figure out a dynamic that works for them, but also parents should not become ATMs.
Listen to the full segment.
Listen to Dave & Dujanovic on weekdays from 9 a.m. to noon.
