Cutting the Purse Strings to your Needy Children

20 year old guy wearing grey jacket

Mom, can I borrow $100?

Dad, I need some money for a down payment on a house, our daughter’s dance class payment is coming up, and we are short… can you ‘lend’ us some money to cover the fees? It would be heartbreaking to take her out of dance.
We are running short and need some grocery money this week – could you help us out?
The grandkid needs braces, and we don’t have the down payment—can you give it to us?

Any of these scenarios sound familiar?

The reality is that once a child grows up and becomes an adult, there is no guarantee that they will have a trouble-free, financially sound life. There are obviously times when everyone could use a little financial assistance, and as parents, cutting the purse strings to needy children completely can be difficult. However, there are also quite a few ‘adults’ out there with families of their own who are still literally hanging on to their parents’ purse strings, depending on them to get through a life they’ve built without realistic financial goals.

Helping Without Enabling

Before just writing the checks to keep your adult children afloat, experts advise that you take some time to find out more about the situation. Ask about their entire financial picture and their plans to get back on their feet to possibly avoid this situation in the future. If the problem is mismanaging money and poor planning, throwing money at the situation is nothing more than a temporary solution. Aiding an adult child who is financially irresponsible has been proven to only continue the habit. The more you say yes and the more you give, the more comfortable your children will become with asking for and expecting money. In other words, their safety net in times of trouble should not always be their parents as the rescuers.

Additionally, eventually, you will grow tired of constantly ‘lending’ money and will feel taken advantage of. According to psychological experts, grown children should keep their money matters as private as possible and should learn to stop the cycle of co-dependence. Not only does this money lending and borrowing create friction, but it also makes it more difficult for parents of adult children to respect healthy familial boundaries.

Setting Boundaries and Expectations

Still, these are your children, and you may feel bad for their situation and want to help. Sometimes assistance can be given in the form of advice, helping them secure a loan to get them through (which will force them to repay the loan), or helping with childcare so one parent can get a part-time job and bring more money into the home. Another way of assisting grown children who are hanging on to those outdated purse strings is to sit down with them and help them budget and finance, possibly helping them come up with a financial plan. Sometimes, a new perspective on a situation could be just what they need. If they can’t afford dance class for the grandchildren, perhaps the child should withdraw from dance until the family is in a better financial position. In fact, teaching our young children the importance of money and money management should be a parenting goal.

If you have an adult child who has recently been laid off or experienced a life change that has dramatically altered their financial picture, and they are simply asking for a loan, you must decide if you are able to help. You also need to assess whether this money is truly a loan or if your child will ever be able to pay it back. If you expect repayment, ensure that payment plans and promissory notes are established upfront.

Certainly, unfortunate things happen to hard-working people. If your child is not one to constantly ask for money and is sincerely in need of temporary help, and you have the ability to provide assistance, then do so. However, make sure clear expectations are set regarding repayment.

Most importantly, make sure that before you make a loan or give a gift to your child during tough times, YOU ARE FINANCIALLY sound yourself. Unfortunately, many parents of adult children go out of their way to help their kids and end up putting themselves in a financial hole. Learning to say no, especially if you cannot afford to help, does not mean you don’t care. It simply means that you cannot, and your adult children should understand that.

Additionally, parents need to know when to say “when.” If your child is constantly asking for money, you need to set limits and boundaries. Consider what will happen when you get older and are no longer around to save your child from financial ruin. If you have loaned money, but see your adult child spending on things they don’t really need, then it’s time to close down the Bank of Mom and Dad until they can learn how to be financially responsible.

The reality is that no one can tell you what you should or should not do when it comes to helping your adult children. When it comes to money, you have to decide how you feel about lending, whether it is a constant gesture, and what will truly benefit your child’s life. If you feel your child is taking advantage of you but still want to help, consider paying the dance company or grocery store directly, rather than handing out cash or checks. And if you cannot help, or feel that you are constantly expected to do so, say no and let your kids know that the purse strings are being severed. After all, although they are your children, they are also adults who need to learn to work through tough times and adjust their life to what they can afford, without your help.

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