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| financially support |
Assume you're over 55, about to retire, and have an empty nest. Your 34-year-old son has returned home from a two-year assignment in Kolkata. He seeks to recuperate from yet another unsuccessful attempt to advance his profession. You will have to shelter, feed, and care for him until he can find work. You take up a part-time job after office hours to supplement your income. And you frequently wonder how you may wean your adult kid off of this critical financial need.
Adult children living with their parents is not unusual in India. According to an HSBC survey, over 55% of Indian parents continue to offer financial support to their adult offspring. Clearly, providing financial aid to adult children is fraught with difficulties. "Parents spend an average of 37% of their discretionary income on supporting their grown-up children, and 56% spend less on themselves in order to have more for their families," according to the survey.
This behaviour is both convenient and inconvenient. Parents can help their adult children in a variety of ways, including paying off their education loans, funding an international vacation or expensive birthday or wedding parties, taking on EMI, insurance, and bill payments, bailing them out of defaulted credit card and loan dues, volunteering a down payment for a new house or car, offering a monthly allowance, or taking care of their entire family expenses.
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| Master |
Why do parents provide assistance to adult children who should be responsible for their own lives?
According to sociologists, child-centric family structures have instilled in modern society the belief that parents exist only for the sake of their children and must go to any length to ensure their well-being. This entirely emotional decision to form a cohesive family unit loads parents with the responsibility for their child's failings. The fixation has resulted in a generation of helicopter parents who feel compelled to know and solve all of their children's issues, to protect them from everything that may go wrong, and to support them when it does. This applies to intentional choices their children make freely while understanding the repercussions - particularly financial ones.
What are the consequences of this trend?
Parents' finances are jeopardised as a result of the emotional toil of caring for an adult child's well-being. Many supportive parents jeopardise their health and retirement savings; many liquidate their assets at cheap valuations; split their amassed riches unfairly; or compromise on their life ambitions. The truth is that you should not be working two jobs when retirement is only a few years away. Use our Retirement Calculator to determine how much corpus you will require throughout your retirement years. The calculator will also tell you how much money you need to save each month to fulfil your retirement goals.
Here are the many forms of pension plans and their tax advantages.
How can financial interactions between parents and children be maintained sane and logical if they are not avoided?
A rule-based approach might be effective. In joint households with a pooled account for household costs, there should be a clear understanding of who will do what and spend money on what. In exchange for saving money on rent and maybe inheriting property, children take care of their parents until they die. The rules can be twisted and shaped to fit the needs of the family, but the general outline must be there.
Furthermore, suppliers may find it easier to sustain finite, measurable, and precisely defined financial support. You might wish to consider reminding your returning kid that he must live independently on a certain monthly stipend for a set period of time, during which he must find job. Help should be explicit, and arrangements should not be difficult to terminate.
Allowing children to push the button that triggers your need for approval and attention from them is not a good idea. Simply say no if you are willing to do so. Fear, hope, guilt, regret, or menace should not guide your emotions.
Finally, remember that you are the single owner of everything you have achieved over your life, and simply because your children are your offspring does not give them the right to your assets and money. You have the right to spend it whatever you choose. You may use it to fund your retirement, protect your grandchildren's future, or even donate it to charity.
Bottom line: If you have an adult child who asks for financial favours, give them time to think about it before accepting. Purchasing time will alleviate the strain and allow you to say no if necessary.
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