When Should You Stop Supporting Your Child Financially?

by David@MoneyNing.com · 6 comments

Sara turned 10 this year, and we recently started to give her a small allowance. For now, the monthly amount is tiny but it’s good for her to start making choices on how she wants to spend her money.

Everything is going well so far, as she’s having to weigh the pros and cons of paying for everything she wants. We plan to continue this monthly stipend for years to come, but when should we stop giving her money? There will come a time when we need to stop supporting the kids. When is it appropriate to turn off the financial faucet? And how do we even do it once we figured out it’s time to revoke ATM access to the Bank of Mom and Dad?

How I Stopped Living Off My Parents

In retrospect, my parents were parenting geniuses, as my sister and I were weened off of support without any formal discussions on how the transition was going to work. We basically stopped getting financial support when we got our first job, and it’s a plan I want to follow with my own kids. Here are a few insights on some of the things my parents did right, and how you can stop supporting your child financially too.

Set clear expectations. My mom told my sister and me for years that one of her biggest regret in life was not being able to go to college. Her academic performance was fine at the time, but she had to quit after high school because she needed to get full time work.

As a result, our number one priority was to concentrate on school and at least finish college. She encouraged us to get summer jobs, but part time jobs were a big no-no through the school year.

As a parent that always seemed reasonable, it was clear that she was going to fund our living as long as we were being productive at school.

Actively encourage your child to get a job. My parents told us, among other reasons, to get a job because it wouldn’t be possible for them to support us forever. This was probably true for most parents, but they actually took the time to admit and remind us of the fact. If not, I wonder whether I would be as motivated to find work since I was far from realizing how much it takes for someone to fund decades of retirement.

Try to not rush your kid into starting to pay for everything.

My parents were patient to let me ease into paying for my fair share. While they encouraged me to take a part time job working at a golf range, they didn’t sabotage their efforts by making me pay for everything as soon as I had income. Can you imagine how motivated I would be to show up for work if I had to pay most of my wages to help out as soon I accepted any job and not have to pay a dime if I didn’t?

Instead, they let me start earning money while I was looking for a job that matched my studies.

Ramp up financial education. My parents were much more forthcoming about how much everything costs once I started working. They weren’t complaining to me. Instead, they were helping me realize how much it took to run a household and to get me ready for the day when I have to pay for some of those expenses.

Let your kids go. My parents kicked us out of the house when the opportunity presented itself. Both my sister and I started our first full time job in a different country than where my parents were living in at the time, but my parents never made us feel bad about leaving. My parents did secretly maintained our old place that was too big and too expensive for them to live in forever hoping we would return someday, but we didn’t know that was why until years later.

Living far away made the transition easy in a way, but they also made sure we didn’t just spend more than we earned and asked for a handout.

Keep in touch with your kids’ finances. My mom was wise to be caring enough while we grew up so we were very willing to share the details of our lives with her. Once we were adults, she regularly kept in touch with us to talk about our lives, with finances being one of the big topics. By acting as a financial coach, she helped us develop good financial habits, and not only stopped us from going deep into debt but also made sure we won’t need financial help from them.

Let your kids run out of money. Or at least, have the fear of running out. My sister and I both saved enough during the good times that we never really ran out of money, but I still remember panicking when I started spending more than my income. I remember telling my mom about it, but never did my mom freak out and started offering me money left and right. She comforted me, telling me that it’s natural for me to have higher spending in some months, and that’s why we save in other months to make up for it.

If she started offering help as soon as she smelled a hint of danger for her precious children, then we might’ve never developed the sense to control our spending whenever it’s appropriate to do so.

Offer a loan instead of giving money if necessary. My parents had the money to help me, at least a little, on the down payment on my first home purchase. Instead, they offered me a loan with specific terms for me to decide if it was worth the trouble. Many parents, especially those who only have one child, justify giving their money because they figured the money is going to them eventually anyway. What they fail to realize, though, is that they are enabling their child to live beyond their means by giving them money early. This isn’t a big deal for children that are financially responsible, but it could be disastrous if the kids expect to get help whenever they don’t have enough.

Many people share with me how hard it is to stop supporting their adult kids, but what many people find difficult doesn’t have to be a challenge for you too. Start communicating early, set good expectations, help your kids find income, and don’t enable them.

Your kids will do just fine. Like us!

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  • Joseph B says:

    Not enough people give credit to the benefit of kicking your kids out of the house. I was 18 when I was on my own and I made it because I knew I didn’t have anything to fall back to. Sink or swim baby!

    • David @ MoneyNing.com says:

      Not many people want to admit that enabling their kids is actually hurting them. You are right though. Sink or swim!

    • Caro says:

      Unless there is a genuine, sound financial reason to do so, I see nothing praiseworthy about throwing an 18 year old out. Sure, they can work, but their options are somewhat limited, and their educational opportunities even more so, which will have impacts through their life. Obviously, if there’s no money at all, then that’s the reality, but if it’s just ”be mean, toughen them up” thinking, then it’s hideous.

  • Lucas MoneyMaker says:

    Timely post. I’ve done well financially but I don’t want to support my kids forever. They are 24, 22, and 18 now. I plan to just cut them off financially when they get out of college. They can still live in our house while they try to look for work but when they have income, then they need to start paying rent too.

    • David @ MoneyNing.com says:

      That’s as good of a plan as any.

      Good luck to your kids in finding work when they finish college!

    • Caro says:

      That seems much more reasonable. I have no plans to allow my adult kids to live with mommy, getting their every need attended to, laundry done for free etc, but I see no reason to throw out a teenager and crow ”sink or swim” at them. That’s because I love them and want them to know I’m on their side. Sometimes that does involve tough decisions, but hampering their education and making them feel like they have no home to come to anymore is horrific.

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