Your Adult Children May Be Ruining Your Retirement Plan

Most parents have no idea this one habit is quietly destroying their retirement. I've watched it happen for more than 30 years as I've helped families retire with confidence. And it always starts the same way. A grown child needs your help. You step in and suddenly your entire retirement plan is bleeding.

If you watch this next segment, you'll learn the warning signs, the boundary that you must set, and how to protect your future without abandoning your kids. Let's get into it.

Stop rescuing your adult children at your own expense.

Yep. Yep. And when I say at your own expense, I mean at your own expense as it relates to potentially sabotaging your retirement.

Yeah. It's extremely important that you hear where we're coming from on this. The listeners, we want you to understand it's okay to help a child. It's okay to do that. But helping a child over and over and over to the point where it you're making sacrifices for your retirement, you have to remember that kids have more time than their parents. Time, as we just mentioned in the last section, is limited.

Well, and to your point, Spell, if the child that's being rescued here, if they take time for granted, right, then of course they're not going to get where they need to go, right? But the reason they'll take time for granted is when there's a constant rescue boat, right, just over the horizon and they know that in just a moment they're going to see it. And so I like to think of it as parents tend to throw a life ring to the kids all the time.

Yeah.

Now, we're fortunate to have a lot of clients who won't do that.

True.

They have really helped their children develop and their children stand on their own.

That's right.

And they've done a wonderful job. But we also have a number of clients who are throwing that lifeline all the time. And so, if you're throwing a life ring to your children or a life raft while your boat is taking on water, then you might have a problem.

He I'd say that you have a problem.

You might have a problem. And so I know that parents want to rescue their kids. It's instinctive.

It is. It's a key. I get it. And I don't have kids, but I do have nieces and nephews. And I have one nephew in particular. You know him. And that guy is if I could have a son, he's it.

Yep. Yep.

And I worry about him all the time. I think about him all the time. And I always when he goes through a tough patch, I want to throw the lifeline.

Yeah.

And there's been an occasion where I did, but not without strings, right? It came with strings. And you had to do something in order to get this. You couldn't just get the hand out.

Well, Phil, that's a perfect analogy. A lifeline or a life preserver. If you throw it to someone without a string, you can't pull them back.

That's right. You can't rescue them.

Or they got to learn how to swim or I can't get the ring back if they miss it.

Right. True, too.

And so I think, from just another metaphor here, a good friend of mine who lives in Tampa, Florida, he was a paratrooper in the military. And I think about him in all the jumps that he made. And I'm not a guy that's going to jump out of an airplane. If it's flying, man, I'm staying in it. The wings are intact. I'm in.

Well, you learned how to fly planes. So that makes sense.

And I want to fly them, not jump from them, right? But when he was jumping and I think about when he was jumping metaphorically, if the child never has to jump, then how will they ever learn how to land?

Yeah. Right.

And they have to at some point learn how to land. And it's the only way that he learned how to land. He had to jump out of the plane.

Yep.

And he didn't have a choice.

Yep.

Right. He would get pushed out of that plane if he didn't jump.

That's right.

So he had to learn to land. And I think every child needs to learn to land on their feet. And the longer that the parents don't allow that, the more likely that parent is reducing their own livelihood in retirement.

Yep.

Now, if they're super wealthy and it doesn't harm them at all, then fine if that's what they want to do. But it's going to make it tougher and tougher on the kid.

Yeah.

And they're never going to let go—

Yeah.

—of the life ring.

It's true. So true. Paying for your kids rent and mortgage payment temporarily, that could be okay, but we don't encourage it.

No, not a good way to do it.

Co-signing on a home, right? Trying to create that credit for your child. There's other ways to help them create credit versus you signing for them to get a home.

Well, you take a risk.

Big risk.

Put your name on a home. It's a big risk. You expose yourself to credit risk. You expose yourself to a lot of risk.

And paying off student debt. A lot of parents say, "Well, I don't want my kids to come out of school with debt." What's wrong with them coming out of school with debt, right? That teaches them to they need to go to work.

Right. Right. You got to pay the debt. You wanted the education. You got it. You chose to do maybe some higher ed. If the parent wants to pay for undergrad, then maybe that's okay.

Y but they just need to be careful with that. And then letting this one probably bothers me more than any. It's letting the child nest indefinitely.

Yeah. Yeah.

Right. They've got to get out. They've got to be on their own. They've got to learn.

Yeah. And if they don't, then they may never leave.

If they don't, or if a child needs to stay at home for whatever reason, you can always charge them rent. You can have them pay their fair share of the groceries, the utilities, have them do their own laundry. Heck, have them do the household's laundry.

I was gonna say, give them something to do. Let them do some chores. Let them earn—

Absolutely.

—their way. Don't do everything for them.

Right. Right. They need that. That's how they're going to get better. And so, that's not to step on anyone's toes. That's not to say that kids are bad or parents are being bad or that you're just doing things wrong.

Mhm.

It's how do you get them to a place where you know they're going to be self-sufficient. And what we're talking about here is how do you avoid going through so much spend down to support them that you ignore your own ability to spend into retirement in a way that supports the lifestyle that you want and you've worked hard to get there.

Yep. It's not as difficult as a parent thinks it is. And I know a parent doesn't want to hear this, but the fact of the matter is until you get them on their own, they will take everything that you give them and then some.

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