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Parents who support their adult kids

This situation is likely not sustainable. Time to begin gradually cutting them off.

By Karen Datko Dec 23, 2009 1:03PM

This post comes from Trent Hamm at partner blog The Simple Dollar.


A few years ago, an old friend of mine bought a fantastically expensive home, far larger and with higher quality furnishings than the home I live in now.


I went to college with him and noted that after college, he worked at a minimum-wage job for a year and then earned a solid salary for only a little more than a year when he made this purchase.

“How could he afford it?” I wondered. So I asked him about it. He just grinned and said that he had a big bankroll.


For a long time, I figured that he had done something illegal or otherwise inappropriate to earn the money. Eventually, though, I learned that his parents had bought the house for him.


Today, this old friend of mine doesn’t have time to spend with me. Even though he’s making only about $26,000 a year -- at my best estimate -- he drives a Lexus and is constantly buying all kinds of different things. He spends most of his time with similar big spenders -- and that’s not a group I’m a part of.


What I find most interesting, though, is his assumption that his parents’ lifetime earnings are his to spend however he likes.


For some people, this could be a happy arrangement. As a parent, I can understand the desire to want to make life easier for my children -- to make sure they’re content, have social stature, and have the possessions they want and need. I can also understand, on some level, how it would be nice to simply have all of the things that I want without having to be responsible for earning them.

The problem is that the solution isn’t permanent for many people, and when it fails, everyone suffers greatly.


In this situation, the parents are getting older and, at the same time, their financial resources are being slowly drained. Unless they are prodigious accumulators of wealth, there’s going to come a point where it will become difficult to make ends meet, and that point will come when it’s more difficult than before to earn money.


When they reach the age when they’ll actually need their savings and investments, they may find that they’ve been whittled away.


On the other hand, when the support of the parents disappears, the child will be stuck without having learned how to live within his means. In fact, the child’s standard of life is so far beyond his means that, unless the child is very, very aware and centered, his life will enter a very difficult period, laden with debts and some incredibly difficult lifestyle changes. This disruption will alter almost every element of his life -- and many of those elements will involve a serious downgrade.


If you find yourself in a situation like this, the best thing you can do is to begin the process of separating the finances of the parent and the child. It is far better to do it slowly, surely, and together than to do it abruptly, shockingly, and without personal support.


This way, the child will be able to stand on his own two feet financially and the parents will have the resources they need as they reach their later years (and, hopefully, have enough resources to truly enjoy those later years).


A final note: I’ve witnessed again and again that people who choose a $20,000 career believe (or pretend to believe) that they can live like they have an $80,000 career. A $20,000 career is likely to be much more personally and spiritually fulfilling than an $80,000 career. But it’s not financially fulfilling.


Life is full of give and take -- your career choice is just one of them.


Related reading at The Simple Dollar:

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