Paying their Way How much is too much?

Many of our millennial children are smack dab in the era of student loans, expensive tuition and relatively low entry-level salaries. As a result, millennials like my daughter, Paige, rely on their parents to help support them between college and the years they actually start their lives. It seems like graduating college no longer means our children are on their own.

Today they are more likely to be on their own by age 25, instead of 21 or 22, when we had our independence. For some families, this means that parents will pay for their kids’ apartments and cars, or let them live at home rent-free, while they save up for their own place or pay down student loans.

For others, it means paying for car insurance, health insurance, phone bills and other smaller bills that when piled up can be difficult for someone right out of college to pay on a $35,000 salary in a big city like Washington, D.C. That’s where Paige moved right after college and began working.

We’ve helped her in various ways since she graduated. From subsidizing her apartment when she first moved to D.C. to helping out with insurance or phone bills or sliding her some cash here and there, we’ve figured out what works for our family. Paige has done her part in a large way and is grateful for our assistance.

“You all made it clear to me that I bear most of the burden for my choices such as law school, buying a car or where I live etc.,” she says. “But that you will continue to support me in meaningful financial ways that are actually very helpful to me, because otherwise I wouldn’t be able to afford those things, especially while I’m in school again.”

We also made it clear that if she needs something, she should ask for it and not just assume that it is available to her. Making this ask is important, Paige agrees, “because it has made me evaluate what I actually need versus what I want.”

Well said. Well taught.

And as Paige looks around at her peers, she says she thinks there should be a balance. “I always roll my eyes when I hear about friends or classmates who are still on their parents’ payrolls at 25 years old. I’d like to think that I am about 85 percent off of your payroll. I think I am lucky to even be 15 percent on because I know people who are completely cut off and have no financial support at all.”

Sure, it would be great to have a trust fund like some of her friends, she continues, but she recognizes that she’s fortunate to have the support she has now. (Great!)

“I’ve been able to save a little bit more money that otherwise would be spent on insurance or a phone bill and it’s helpful to not have those expenses, particularly in law school,” Paige says.

As more and more people graduate college and move back in with their parents or as parents think about how to support their kids without babying them, it really comes down to what works for your family, but also encouraging your child to be financially solvent and responsible. I think both can occur without being extreme in either direction.

If your child is going to move back home, have a plan: Will they pay rent? Pay for groceries? Figure out how much help is too much. What are the ground rules for your adult child to come and go as they please?

We all need help. Parents should help while encouraging independence. It’s important that parents who allow kids back home don’t take advantage of them as well. The relationship should not be one of burden from either side. That’s just my take on it.

It’s like a lot in life: Think hard about when to hold ‘em and when to fold ‘em.

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