Your Money: Adult Children and Money Management | Company

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Most parents want the best for their children, regardless of age. But once kids reach adulthood, many wonder what their role should be when it comes to money management.

While you may feel obligated to give your adult children money when they need it, you also want them to become financially independent for their own good.

Millennials and Generation Z are more likely to struggle with student debt, higher cost of living, comparatively lower wages, and less job security than their parents and grandparents. It has become increasingly common for parents to continue to offer support, but a short-term lifeline can backfire over time.

As a parent, you are used to putting your child’s needs ahead of your own. But whether you’re paying a cell phone bill, covering rent, or keeping them as authorized users on your credit card, it might be time to reconsider.

Focusing on your own long-term needs is not selfish. If you don’t adequately prepare for retirement, you could end up placing a financial burden on your children in your later years. No matter how capable you feel as a supplier now, you can’t work forever, and at some point your salaried career will end.

In addition to the financial costs, also consider the emotional costs of financing your adult children’s finances. Money always has the potential to put a strain on family relationships and you may start to feel underappreciated. Being dependent on you can make your children feel guilty or like they’re failing. Money could do more harm than good.

One of the reasons parents continue to financially support their adult children is because they feel like they’ve let them down. Maybe some money management principles were forgotten along the way, but chances are you did the best you could with what you knew and the resources and time you had. It’s not too late to put them in place now to be successful.

You can continue to provide support without allowing bad financial decisions. Rather than cutting them off abruptly, eliminate them from your household payroll while teaching them how to manage their own money and bills on the path to financial independence.


John A. Frisch, CPA/PFS, CFP®, AIF®, PPC™ founded Alliant Wealth Advisors in 1995 and has over 30 years of experience as a financial professional. In his spare time, he is an avid cross-country runner, a sport that requires discipline, patience and vision. John applies these same skills to his professional pursuits: He helps families and retirement plan sponsors take a patient, disciplined approach to overcoming financial challenges and achieving their far-reaching goals on a clear path. Learn more at www.alliantwealth.com or to read previous articles, visit www.alliantwealth.com/blog.

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