Grown ups or kids, which are they?

Has your grown child failed to launch or have they returned after the first bump in the road? With the tough economy young adults are having a hard time getting stared. This does not mean you have to pay for everything or necessarily anything at all, as they get started.

If they are 40 and still at home they are not going to get started they have missed the boat altogether. The exception to this is if they have come home to care for you or to be cared for because of illness.

If the kid is 25 or26 living at home not going to school or just doing one course at a time they may need a little help to get going. STOP PAYING FOR EVERYTHING. Make them start to pay. But they don’t have a job....well  it is time for them to take what ever they can and contribute. It is ok to wash floors and work at the local fast food joint, even with a degree. Some thing better will come along but until then they need to contribute.

If they do have a job make sure they are paying their way, rent, food, electrical, water, and  their own transportation.  Give according to your means. Set limits so that it work to their advantage to move out and explore the world on their own away from the nest. 

You may ask, “Why should I do this?” If you continue to supply everything  for ever they will not launch and you will not be doing them any good. They need to be independent so they can care for you or live well after you are gone. If you keep them at home they are cutting into your retirement plans. The amount you will have to retire on will be less or you may have to work a few years longer. Is that what you want?

Just to bring it home. Here is the cost of having them at home.

$500 for room and board... food, water, electrical, heating, wear and tear, 

$60  for the cell

$40 for other things

$600 each month ... $600 set aside each month for retirement seem a better way to be using your money. This, of course, does not include the tax refund you get for putting it in an RRSP or interest earned.

The High Cost of Grown Kids

According to Money’s “Americans and their Money” survey, 38% of people give $1000–$4999 per year to their adult children.  These are not just the margins - this is across the board.

An article on www.time.com/money/page/parentsofadultchildrefinancialsuppot/, states that 25% of adults aged 25-34 still live at home, compared to 11% in 1980.  Only about half of all kids one year out of college, have a full time job.  This is a combination of the economy and the unending support of modern parents.

There is no longer a stigma attached to living at home. Whatever the reason for our kids still being in the nest, we should ask the question “Do grown children benefit from another 3-7 years of nurturing, or are we coddling beyond reason?”  The answer to this question is up to you.

Some thing to consider

·         Will providing money help them become independent, or will it prolong dependence?

·         Reserve your help for needs only not wants.

·         Be frank and state your limits .

·         Is it time for tough love?

·         What are you getting in return?  Charge rent or have an expectation of contribution.

·         Are you giving according to your means?

·         When will the gravy train stop?  Have a clear exit plan.