We all have heard about the "empty nest syndrome," looked upon by parents as either a time of loss, or the beginning of new found freedom. In the past the empty nest brought about anticipation of increased cash flow for saving, a time to spend on things we have long put off, and calm quiet evenings at home.
Well, times have changed; in 2011 the new term is the "full nest syndrome." Adult children are turning to parents for financial help and moving back home, often for extended periods of time. During the current economic environment, it has become very common for even well educated college graduates to have problems finding jobs and living on their own. Thirty years ago, we graduated from college, got a job, found an apartment and became self-sufficient with maybe small bits of financial help from our parents. We had one phone, one television, a couple of utility bills and everything was wonderful.
Now though, our children seem to need an iPhone, a computer, a TV in almost every room, a nice car, and a desire to eat out often (because they don’t know how to cook). Being on one’s own is indeed more expensive, with cable bills, internet connection bills, and cell phone packages costing too much, many of our adult children are having a rough time.
We as parents want to make life good for our children, but maybe we want to make it too good. I talk to parents and grandparents in my practice that feel the pressure to spend their retirement savings on their adult children, and to support their daily lives as well. Parents and grandparents also fear the wrath of children/grandchildren if they deny requests for ongoing financial help, and we all know the dangers of lending money to family members.
The answers are not easy, but I recommend that if you find yourself in this situation, make your retirement accounts sacred. Be more open about your financial situation with your dependents. Discuss your own needs and that you rely on your retirement money to fund your life when you are old and stop working, possibly for 20 years or longer. Remember, we can borrow money for almost anything, but not our retirement.
Joe Arndt CLU,ChFC President of Arndt & Associates Financial Services 8124 Big Bend Blvd. St. Louis, MO 63119.
Securities and Investment advisory services offered through Sagepoint Financial, Inc., member FINRA/SIPC, and a registered investment advisor. Arndt & Associates is not affiliated with Sagepoint Financial or registered as a broker-dealer or investment advisor.