Thanks to a challenging job market and a high cost of homeownership, many adults are relying on their parents for longer than before.
Whether they’re living at home for longer or relying on you for financial bailouts, supporting an adult child can put a strain on your own finances, as well as your relationship with them. If you’re worried about their attitude to money, you can use these tips to help them take responsibility for themselves and ease the strain on you.
1: Don’t worry about being generous
If you are helping your child with a legitimate need, like allowing them to stay living at home while they save up for a house, or offer to help them with unexpected expenses like car repairs, this is very kind and generous. However, remember they are an adult now, and you don’t need to be handing out pocket money anymore. If they’re careless with their money, don’t offer to bail them out and pay their debts. This can hurt your own credit score, leave you out of pocket, and mean that your child won’t learn to take it seriously.
2: Don’t worry about their credit ratings
If they’re missing payments, running up debts, or otherwise hurting their credit rating, try not to get involved. A bad credit rating will make things harder for them when it comes to buying property or getting a loan, but the only way they can learn is to sort it out for themselves. Improving their score is within their control, so step back and let them fix it. You can offer advice, like talking them through options like debt consolidation loans, to help them make the right choices for themselves.
3: Be a cheerleader and lead by example
All children want their parents to think that they can overcome any obstacle. Show your support by becoming their biggest cheerleader and celebrating their efforts to be financially savvy. Lead by example too by having a good grasp on your own finances, and share your skills, knowledge, and tools that help you to do that.
4: Have clear limits and intentions
Make sure you have been clear that you won’t be ‘the bank of Mum and Dad’ at the drop of a hat. You could decide that you will help in an emergency, and should lay out clearly what that means. This could mean you will help foot the bill if they need emergency repairs to their car after an accident, but won’t help deal with debts run up on a store credit card.
5: Offer solutions
Rather than offering cash, offer other solutions to money troubles, like helping your child find a debt charity or financial advisor to speak to. This can help them to better learn to manage their own money without needing you to hand out money all the time. Remember that by helping too much, you’re actually hurting them, as they won’t learn to be independent of you and how to be in charge of their own money.
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