In the early days of this blog, I wrote about the increasingly popular trend of boomerang children: those children who move out, go to school, graduate, and boomerang right back to their room at mom and dad’s to live rent-free.
Two years later, it seems the trend of students leaning on their parents post-graduation hasn’t slowed. In fact, a recent copy of Newsweek addressed the issue of parents footing rent and utility bills for their children after college, mostly because those college grads didn’t want to learn how to budget.
A Help or a Hindrance?
As parents, we are naturally inclined to help and protect our children. However, as much as we may want to continue to provide for them post-college, it is crucial that they learn how to do for themselves what we have learned to do. After all, how can they provide for a future spouse or their own children one day if we’re still covering their bills?
The timing of the final rent payment from mom and dad is a personal decision, but teaching financial responsibility can begin at a very young age. For very young children, you could use a chore-and-allowance system to begin teaching about money, older children can try working part-time either for you or for a local business. (I previously wrote an article about a few ways to start teaching about finances that you might want to scroll through for some ideas!)
Remember, you don’t have to necessarily sit down and have serious conversations about money management and give lessons on how to build an investment portfolio. Instead, use everyday situations as teachable moments. Use day to day happenings you think and talk about throughout the course of the day to inform your children about how their money habits will affect their future.
For example, you show your child the cash register receipt from the market to show how much you were able to slash the grocery bill for the week by shopping the specials and keeping impulse shopping to a minimum. Or you can explain how you set aside money from your checking account to pay off that credit card purchase you made online so it doesn’t become a revolving balance where interest charges keep accruing. And how about demonstrating to your child how you are planning for the future by showing how each paycheck you automatically take a percentage of your pay and put it away for your future in a retirement account – out of sight, out of mind.
I’m sure you can come up with literally dozens of teachable moments just from the financial decisions you make on a daily basis.
A Sense of Accomplishment
The wonderful thing about helping your children become financially responsible is that it is a skill that will help make them become more independent–which is what most children want anyway, especially after college. The more they learn now about budgeting, wants vs. needs and saving, the better prepared they will be to tackle rent, credit, bills and banking on their own one day.
Creating a Safety Net
None of us are inclined to leave our children hanging when times are tough, so as you encourage your children to step out on their own, help them build a set of “safety nets” as well. This may be as simple as creating an “emergency fund” for unexpected car repairs. It might also be more complex, such as working out a short term rental agreement if they need to stay at home for a few months after earning a degree. Though children aren’t always excited to attempt funding their own expenditures, having a backup plan can make them feel more secure as they take the leap into adulthood.
As our children get older, it is our responsibility and privilege to step back and allow them to grow. That doesn’t mean we can’t still provide guidance, however. Rather than reaching impulsively for your checkbook in a money crunch, consider brainstorming with your child about how he or she can tackle the situation. For example, could they cut out the cable bill? Take public transportation? Work extra hours, or take on a second job?
Taking on the world may not always be pleasant for our children, but it is a quintessential part of growing up–and one of the best ways for them to learn to handle adversity and to build self-confidence – both important life skills.
All the best,