The Family Banker

You've done everything right as you plan for your retirement.  You've contributed a healthy amount of money to your 401k or other retirement account.  You've paid off your mortgage or plan to in the near future.  You've controlled your spending on stuff you don't really need.  And you've already made plans for your medical care once you retire.

That's right.  You've done everything by the numbers.  Problem is, when you look over your financial portfolio, it doesn't seem nearly as big as you had envisioned.  How could this possibly be?  Well, if you're one of millions of Americans represented by Ameriprise's recent Money Across Generations II survey, the answer may lie in your children.  And we're not talking about toddlers or diapers here.

Adult Children ... They're Baaaaaack!

We all try to teach our children right and wrong.  We also want them to understand the value of a hard day's work.  We hope they will grow up to be valued and respected members of the community who will make a good life for themselves.  Of course, they can't be perfect, but if they're self-sufficient, you probably feel as if you've succeeded as a parent.

But what if something goes wrong?

Truth is, you never know what might happen.  No matter how much your adult children are prepared, no matter how hard they work, a financial downturn can occur, which has the potential to strip them of the livelihood they've worked so tirelessly to achieve.  And who are they most likely to turn to when they need help?  Good ol' Mom and Dad, that's who!

Obviously, family is a very important part of our lives.  So, if your adult children find themselves in a financial jam, it's commendable to help them out.  The big problem develops when parents go overboard.  According to the Ameriprise survey, more than half of those questioned admitted to allowing their adult children to move back in with them and not pay rent.  This would be acceptable if it stopped there.  But more often than not, those same parents are also footing the bill for nearly everything else.  Car payments, medical bills, even food ... it's all fair game.

Commendable ... But Dangerous

For many people, family is one of the most important aspects of their lives.  And that is exactly how it should be.  That being said, it's one thing to assist your children, even your adult children, when they need it most.  But it's a much different animal to find yourself paying off your children's student loans and car payments when you simply can't afford to do so.

Many parents take a stance where they basically say, "Well, we have plenty of money in savings ... we can afford it."  While this may be true, your savings can be eaten up pretty darn quickly if you aren't careful.  And since this is your children we're talking about, it's difficult for many parents to stop spending their money to take care of them.  Which, as you can imagine, can be devastating to their retirement plans if they aren't careful.

Despite the fact that many baby boomers are beginning to fall behind, most don't regret their decisions.  In fact, almost 90% stated that they would repeat their actions if they were to go back and start again.  Although they admit that their children have neglected to learn financial responsibility, it seems they are more intent on bailing their children out than teaching them how to take care of themselves.

Source: http://firstsecurityfinancialshow.com/blog/bid/163878/The-Family-Banker

Gordon Brent Pierce, Brent Pierce, Gordon Pierce, more info, website, site