Helping your kids without draining retirement funds
Carlos Amezcua met with David Kanani from Kanani Advisory Group to talk about how to offer financial help to your adult children without draining your retirement fund.
53 percent of adults between the ages of 21 and 37 are receiving financial help from a parent or guardian. The help can be anything from covering monthly expenses (rent, groceries, etc.) to paying off student loan debt. While it’s normal for a parent to want to help their children, if not careful it can become a burden on their own financial future and retirement.
Four tips for viewers who may be in this position:
1. Know Your Limits and Set Boundaries
Put a limit on how much and for how long you’re willing to help. Whether you agree to help for a year or ten years, this needs to be communicated. When you’ve reached the limit, don’t be afraid to say “no.”
2. Create a Detailed Plan
Sit down with your children and put a plan in writing. Help them create a budget, and determine which expenses your money will go towards.
3. Teach Your Children
Don’t just hand off the money like an allowance. Take time to teach them along the way so that when they become independent they know how to manage their finances properly on their own.
4. Put Yourself First
As selfish as it sounds, it’s important to put your financial needs first. Keeping your own finances on track and planning for your future could be in your children’s best interest as well.