Don’t Let Adult Children Threaten Your Nest Egg

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It may be time to plan a date to financially cut off your adult child.


There is a sense of parental duty to be there for your children – no matter how old they are. But parent’s who continue to support their adult children financially have the potential to face financial risks.


Parents supporting adult children may find themselves draining their savings and cutting their own living expenses to budget them in. Parents can also find themselves dipping into their retirement nest egg to lend support.


According to a May 2015 study by the Pew Research Center, 61 percent of American parents with adult children gave adult children financial support the past year. (1)


Furthermore, thirty percent of Americans ages 50 to 64 polled had an adult child living with them most of the year. (1)


A separate survey found more than 60 percent of individuals providing care for family are saving less for retirement as a result. (2)


While parents may feel the financial responsibility to be there for their children, chances are one day they will be on their own. Adult children shouldn’t learn to be financially independent in their late 40’s.


Make a course of action.


Don’t let guilt sway you. Like the many lessons your adult children received when they were younger, financial independence is another life lesson to dish out.


Initiate the discussion. No change will happen unless you get the ball rolling. Sit down and start a discussion on a topic that can lead to their finances (like a recent career change).


Give a timeline. An immediate cut off can be overwhelming. Provide a timeline so they can start to commit to their own financial game plan. If it is as drastic as them moving out of your home, be considerate, yet firm, of when they need to move out.


Create expectations. Maybe there is an area that you still want to reasonably help out (meaning no hindrance to your own finances). Continuing to help with student debt is understandable, but make it clear you will not pay for their vacations or other materialistic wants.


Additionally, if you don’t want to push your child out of your home completely, enlist them to contribute to financial household expenses like rent, utilities and groceries.


You can always be there for financial advice, but it may be time to take your money out of it.



1 – [11/11/15]
2 – [Accessed 8/3/16]


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