The key words to consider are “financial aid.” If adult children need help with financial stress and the parent is in a position to help, it makes sense to do so. Watching someone struggle financially when we have the ability to make things easier for them and relieve their stress seems harsh.
However, as with all financial matters, the pros and cons of helping one’s grown children with finances must be carefully weighed and thoughtfully considered.
We all have a desire to make life better for our children. Taking into account each child’s personality and lifestyle will help us make good financial decisions in their regard.
Is the individual in financial need because he has been living irresponsibly? Does he want to live the good life and spend in excess of his ability to earn? In this case, being too generous might cripple independence and enable a lack of motivation.
On the other hand, if an adult child has been plagued with legitimate hardships such as employment issues, medical bills or some other traumatic situation, and has previously displayed productivity and a good work ethic, a helping hand might be in order.
Assistance can be in the form of a loan or an outright gift. Only you can assess your financial picture and determine which is best for your situation. If you have recently retired and probably have many years ahead of you, a loan may be the appropriate way to offer help. Sometimes, however, an outright gift is more beneficial to eliminate feelings of guilt about ability to repay.
It is the parent’s money and his ultimate decision. However, a parent will want to guard against using money as a control mechanism in the parent/child relationship. To withhold assistance when a child is struggling with immediate financial difficulties in order to “reward” that same child with a larger inheritance could be motivated by a self righteous attitude or an attempt to “bribe” for attention.
I am reminded of the classic example in the original version of the movie, “Fun with Dick and Jane.” Jane asks her wealthy parents for a loan when Dick has been laid off from his job and they are struggling to keep food on the table. Jane’s father declines and tells Jane the struggle will be good for her and Dick. He reiterates his wealthy status and lords over his daughter how he is reaping the benefits of his frugal and wise life.
The movie is a comedy with some profound truth and wisdom interwoven into the laughter.
When a person is down and out, that would not be the appropriate time to preach, or wax philosophical about the benefits of frugality. If one can help, then do so. If one is not in a position to offer help, then sympathize and commiserate, but refrain from self righteously sharing personal good fortune stories.
It is not the parents’ role to teach children “life lessons” by withholding potentially available assistance in a time of dire need.
There is also no virtue to hoarding excess money in the bank when children and grandchildren are suffering or deprived. If you can relieve the stress without putting yourself in a financial shortfall, it is prudent to do so.
Your thoughtfulness and generosity will reap you immeasurable benefits. You will have the enjoyment of seeing your offspring thrive and the peace of mind which accompanies helping another. Your child will be filled with relief and gratitude and might even acquire a “pay it forward” attitude and one day follow your example by helping someone else avoid financial distress.
No inheritance can outweigh those immediate benefits.