A lot of parents--and adults who aren't parents--swear by tough love: Once the kids are grown and flown, they're on their own. They should live within their means and not come running to the bank of mom and dad to bail them out.
Yet, many of us find that a hard dictate to live by. We may want our college grad to get that PhD in American history, even if it means we provide a little sustenance along the way. We may encourage our child to take that job with a non-profit that's helping register voters in poor areas of the South, even if it barely pays a living wage. Then there are life's emergencies and tragedies. A child's spouse is disabled; a grandchild becomes ill. Wouldn't we want to hold out a helping hand and, if we're no longer here to oversee the stipends and handouts, make sure there's no gap in the funding?
Not to be morbid about it, but if we want to make sure that when we die a grown child has funds immediately available for a situation we're overseeing now or for an emergency that could occur in the future, what sort of plans can we make?
Here are two ideas:
One is to set up a joint tenancy bank account now, which would be accessible to you and your grown child. When you're no longer around, it's all your son's or daughter's. That means the money is immediately available whenever it's needed even if it takes weeks or months for your estate to be settled.
But better know your child. He or she could withdraw emergency funds before there's an emergency. As one financial planner put it, "If a child is having financial difficulties to the extent that a monthly stipend is needed to keep them afloat, chances are they may lack the discipline needed to resist taking the money out of the account prematurely." One other hitch: joint accounts held in the names of the parent and child are exposed to the creditors of both. If your child has creditor problems, the joint emergency account could be levied or even claimed by the child’s creditor.
The other idea is to give the trustee or proposed executor of your estate clear and legal directions to make an immediate distribution to the child who needs support. You can fund the request by either setting up a joint account with your trustee or executor, making cash available to them or giving them a cashier’s check to pass on to your son or daughter at the time of your death.
Meanwhile, let's hope they're in good health, on solid financial ground, living a joyous life--and don't need your help.