HOUSTON (FOX 26) -
rings and it's your adult child, asking for a small loan to help make ends
meet, some cash to pay off a debt or your assistance with some other need. Of
course, you want to do everything you can to help, but can you afford to do so without
upsetting your own financial well-being?
Q #1 – It seems this is a growing
- Yes. Student loan debt has
- Average credit card debt has up
- Difficult job market for new
Q #2 – What should a parent do when
they get a request?
- Ask yourself, "Can I afford to help?"
- Mixing family and finances can be tricky
- Support your adult children in ways you can afford
Q #3 – What about tapping retirement
account to help?
- Consider financial consequences:
- 10% penalty if under 59-1/2
- Becomes taxable income &
your tax bill increases
- Consequences for stopping
contributions as well
- You lose the ‘free money'
- Miss out on compound interest
Q #4 – What alternatives do you
- Look for other ways to help
- Let them move back home
- Watch the grand kids
- Pay for gas or groceries
- Be creative