Generational Tension

Geoff SchaeferAdvisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.

Any parent wants the absolute best for their kids. We all want a future for our children that is better than ours. But is there a point where support crosses a line and becomes a form of dependency for adult children while putting the financial security of the parent at risk?

There is a case to be made for generosity, and we should give sooner rather than later. But how can this be done successfully and responsibly?

I’ve been blessed to work with many generous clients. They want to give back to their community and provide support for their families. Those instances were responsible and should be encouraged, but there have been situations where the generosity of a parent not only led to overspending, but to the dependence of their adult children.

In one case, a client’s desire to assist their child in paying for their undergrad degree led to them funding a graduate degree and the subsidization of their child’s living expenses after graduation. A planned expense turned into hundreds of thousands of dollars of spending and a child with multiple degrees who is still dependent on parental support.