Money Talks News - Parents provide for their children but for how long? And how long is too long? The National Endowment for Financial Education says 59 percent of parents provide money to their adult kids after they've finished school.
It's natural to want to help your kids get started in life. But when that financial help starts hurting you financially, it's time to cut that cord. Not sure how? Here are some tips:
First, have a conversation. Express your support, set goals and discuss how to reach them. Next, make a plan to end the help, including specific dates. Then, offer help that doesn't involve cash. Babysit if your child needs time to work or job hunt, or use your business connections to help them land a better gig.
Parents helping with credit cards or student loans need to understand that helping keep things current is one thing, but co-signing a loan is something else entirely. If a child defaults on that cosigned loan, it's all up to the parent to pay it back.
Parents should help their children create a budget. The budget should focus on destroying debt and saving for the future.
And finally, lead by example. Parents who pay their bills on time, work on their credit score and save where they can, set the tone.
Shutting down the bank of mom and dad will not be easy. But at the end of the day, it could be just the thing that helps the child succeed.
For more information, tips and links head over to the Money Talks News website and do a search for "Cutting off the kids."