It might sound easy, or at least like common sense: Don’t bail your children out financially once they are out of your house and on their own. After all, you probably want to retire some day and you need to save every penny you can!

But as parents, it isn’t always easy to sit on the sidelines and not help your child. And thinking about how much you will need to retire isn’t always top-of-mind when your kid is struggling financially and you are in a position to help.

For many parents, however, bailing out your child or children can be a detriment if you plan to retire in 5, 10 or even 15 years.

So what can you do to parent your adult children while not ruining your own plan to retire? It isn’t always easy. Parents can hurt their retirement plans by paying for college, letting their adult children live with them long after their teens and early 20s (and footing the bill for it!) and helping them pay for homes, apartments or other expenses.

According to a U.S. Census Bureau report, 1/3 or people aged 18-32 (or about 24 million people) lived with their parents in 2015. And in 2016, more young adults lived with their parents than lived with a spouse.

This parental help and support might be good for the young adults but for parents planning to retire, it can be detrimental. A recent Bankrate study, for example, showed that 50% of respondents were supporting their adult children and hampering their own retirement goals to do so.

So why are people doing this? It could be a part of the trend of “helicopter parenting,” where parents are more involved in the lives of their children than past generations. Or it could be that parents just want to give their children a leg-up financially because times have changed and it’s more difficult now to buy a home or pay or an education.

However, those nearing retirement might need to have difficult conversations with adult children about financial help and retirement plans. After all, if you can’t afford to retire, that could affect your family down the road as well.

Also, by setting boundaries for financial help, you are teaching your adult children important lessons about money, budgeting and retirement – lessons they will need in the future as well!

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If you have other questions about retirement plan loans, email us or call 937.308.0758.