Our generation may be "overinvested in our children." That's the reason financial planner (and consumer advocate), Eleanor Blayney, gives as why some of us have let ourselves slip into debt--despite carefully saving for retirement.
There is, of course, the job market problem--an issue for those coming out of college in the past few years. Now that they are grads, we may help them with rent, put them up rent free at our place and otherwise offer a helping hand until they find their footing. It can become a problem when the costs go beyond our vacation funds and tap into out retirement kitty.
But the issue is wider than that. Even their older brothers and sisters who entered the job market at a more generous time are struggling with financial disadvantages. According to a March study from the Urban Institute, they have considerably less wealth than we did at the same stage of life: They bought homes at the height of the bubble--the market's peak--and are now stuck dealing with the decline in home prices; they also put less money down (unless we helped with that 'little' investment), making it more likely that they have negative home equity. The UI study also reports that younger workers have tended to marry at a lower rate, have lower incomes than their parents, pay much higher costs for health insurance, and are more likely to be carrying college debt.
No wonder many of us rush to "invest" in them, to try and even out the balance and keep them heading in the direction of a lifestyle that al least nears the equal of ours. If that sounds frivolous--or keep-up-with-the-Joneses--it is nonetheless at the heart of a worry many of us have. A friend remembers her daughter's post-graduate apartment in a run-down (low-rent) section of a city in California. It was in a dreary neighborhood in a one-room apartment that had hooks on a wall for a closet, an entryway covered with planks (to keep you from falling into a hole) and space for little more than a bed and night table that doubled as the table where she ate her meals. "It made me want to weep," my friend tells me. "How could her father and I live in such comparative luxury and let our child live in such reduced conditions. I wanted to write her a check right then and there and demand she find a better place to live."
Most of us resist (as did my friend) and let our kids build character and work their way through the "tough" times. That is, we do that unless we feel the safety of our child is compromised. And then we invest, whether we have to tap our 401k account or not. It is one thing to say--as friends without children do--that children should stand on their own two feet, that we do them no favor by sheltering them from reality. No one helped them out when they were our kids' age.
And yet, times have changed. the burdens are blurred--and heavy. We don't want to spoil them--whatever that means--or enable destructive habits. And that remains a basic tenet in whether or not to help support a grown child. But beyond that, for many of us, the investment seems both necessary and worthwhile.
