Sharing the Wealth

Helping out our grown children now or leaving a legacy for later

By Penelope Lemov –

My husband and I have been incredibly lucky. We came of age in the great economic expansion that followed World War II. We’ve had good jobs and rewarding careers–to the point where we have been able to set aside enough padding for our retirement–and a little bit more. It’s that “little bit more” that now wiggles and jiggles inside my brain and bank account.

If we have “a little bit more,” why not share it with our grown children in the here and now? Not to spoil them but to step in when there’s a crisis or a need. Or to indulge them in something we’d like them to have—like a dishwasher or a fence for the yard. And to let them know in advance that should they need help, we’ve got their back.

Fortunately, my husband and I are on the same page: We see nothing wrong in this. But recently, I’ve seen some material that has raised doubts about how wise a practice this is.

In “Choking on the Silver Spoon,” psychologist Gary Buffone suggests that to keep on offering money both spoils grown children and infantilizes them. It’s a way to control the kids by using money to tie the apron strings. The author suggests that we who offer cash are suffering from affluenza, that our financial parenting has run amok.

I took that to heart. Then I read an online story that interviewed several psychologists. They too tsk-tsked the idea of helping out their grown kids with money. When questioned about their own personal practices, however, all admitted to being guilty of indulging their grown children financially.

Is this a case where common sense and psychological theory differ? And does it all come down to what we’re comfortable with, with what makes sense for our particular children and their behavior. If they aren’t dependent and don’t make constant demands and suggest they expect our help indefinitely, then why not help out on an as-needed basis?

Here’s how one friend parses those differences. He starts out with this philosophy:  “I believe in fostering independence. They have to stand on their own two feet.” And yet, he admits it’s more complicated than that—for him and his grown children, both in their early 40s.

His married daughter–a mother of two and a lawyer who has opted not to work full time—called him and asked him for $1,000 to cover the costs of a trip to be with her best friend whose mother had just died. He declined. “It would be nice for her to go,” he says, “but this is something she should pay for herself.” In other words, it’s not an emergency; it’s not something she absolutely needs.

He then went on to say he had just lent his son money to buy a boat. A boat! Certainly not an emergency. The son is prospering in his job and has long dreamed of owning a boat. He asked his dad for a loan so he can buy it now. It could clearly fall under the category of something he should pay for himself. And yet, the dad said yes, without hesitation.

Why? The son has borrowed money from him before; he has always paid it back–on time and in full. The daughter, it turns out, has also borrowed money from dad–and never pays it back. From the dad’s point of view, her requests for money come with a sense of entitlement.

In effect, he is applying a business-like calculus to his children’s requests for financial help: A loan, yes, but only if the credit rating has been maintained. A gift, maybe, depending on what it’s for and how good the credit standing is.

As Penelope Lemov, I’m a senior editor and financial columnist for a national magazine on state and local government. I write two monthly columns on finance and tax policy, both of which are posted at Governing.com.  In my more personal life, I’m known as Penny. I have one husband (of 45 years) and two grown children, both of whom have started families of their own in cities far from the family home and from each other. The grand total is four grandchildren, one grandpup and a lot of travel to visit them. Their lives and the way our lives intersect with them are the spark behind my blog, Parenting Grown Children: What Dr. Spock Forgot to Tell Us.