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Old 05-20-2019, 03:27 PM
 
Location: Eastern Washington
14,242 posts, read 44,903,829 times
Reputation: 12823

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Quote:
Originally Posted by MI-Roger View Post
There is an article on the MSN Money page today regarding retirees and pre-retirees giving sums of money to their children for home purchases. I am substituting "Kick-Start" as the terminology in place of "home purchase" because funds transferred may have been used for homes, student loan debt repayment, initial funds for retirement savings investments, etc.

So how many of us have done this, or considered doing it and decided to not do it, and why?



Starting off:
  • Yes we did it.
  • Dollar amounts to remain confidential.
  • Financial Advisor thought we were Nuts but developed a plan for us
  • We did it to "pay forward" in the same manner my wife and I benefited from unannounced money gifts from my parents when our household and family were young. Why make our children wait, and potentially struggle financially, for decades until our deaths?
  • No strings attached other than each couple was told 5-6 months in advance that this would be happening, what the dollar amount would be, and asked to determine their own plan of how they would use the money.
I fully expect to be called Nuts by this forum too. Oh well, we are all different.

Hey, it's *your* money, provided you are robustly situated to be able to make such gifts, it's no more nuts than any other discretionary expenditure. Now, if your financial advisor was saying you are "nuts" to do this because you are not really in a good position to do it, OK, maybe you are nuts. You may very well be nuts to pay the guy and then not take his advice.



Child-free by choice, although I married late in life to a gal who brought her daughter (only kid young enough to "ride her coat tails" on the visa) with her from Ukraine. I did help the kid with college expenses, she may not have realized how contingent that help was on taking a serious degree and getting good grades - but her choice of accounting and finance, and the good grades she made, saw to it that the issue never came up. Now this kid is a well-set up accountant at a big and growing tech company, married to a guy who worked at Microsoft and now is part of a start up, has equity, so, they are not going to need any money from me.



So, while I won't be doing this, that in no way means I disapprove of you doing it.
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Old 05-20-2019, 03:30 PM
 
Location: Charleston, SC
1,362 posts, read 766,848 times
Reputation: 2428
Daydreaming wistfully about the good ol' days, it's important to remember that College cost about 10 grand -- for all four years. And graduates had their choice of good jobs with full health bennys and pensions -- not these unpaid internships and entry level contract employment.

I gave my kid a Kick Start because she earned it with good grades and study habits all through her schooling.
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Old 05-20-2019, 03:48 PM
 
Location: Washington
45 posts, read 13,796 times
Reputation: 118
We always paid for his cars and insurance while he was working and in high school and College along with free rent
When he bought his first home a few years ago, we provided 25K.
In College he started working for Apple from home. Moved up a few times but recently quit the job.
Has some mental issues now he is grappling with
Compared to friends, we haven't given him much but it's nothing to shake a stick at either
He earned all of it
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Old 05-20-2019, 06:46 PM
 
95 posts, read 26,512 times
Reputation: 149
Quote:
Originally Posted by MI-Roger View Post
There is an article on the MSN Money page today regarding retirees and pre-retirees giving sums of money to their children for home purchases. I am substituting "Kick-Start" as the terminology in place of "home purchase" because funds transferred may have been used for homes, student loan debt repayment, initial funds for retirement savings investments, etc.

So how many of us have done this, or considered doing it and decided to not do it, and why?



Starting off:
  • Yes we did it.
  • Dollar amounts to remain confidential.
  • Financial Advisor thought we were Nuts but developed a plan for us
  • We did it to "pay forward" in the same manner my wife and I benefited from unannounced money gifts from my parents when our household and family were young. Why make our children wait, and potentially struggle financially, for decades until our deaths?
  • No strings attached other than each couple was told 5-6 months in advance that this would be happening, what the dollar amount would be, and asked to determine their own plan of how they would use the money.
I fully expect to be called Nuts by this forum too. Oh well, we are all different.
I certainly don't think you are nuts. We have done something similar and expect to do so again. We do expect to inherit a significant amount and as we do not need such an amount, we do plan to pass much of it through to the next generation sooner rather than later. We do ask that they put the funds to a worthwhile cause eg education, home purchase or improvements or investment rather than frittering it away.
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Old 05-20-2019, 07:01 PM
 
Location: Coastal New Jersey
56,055 posts, read 54,552,165 times
Reputation: 66398
I don't think you are nuts. I have a good retirement income, but I don't have any substantial savings, so I don't have it to give. If I did, I probably would. I only have one kid. I helped with college expenses by taking out loans, which I have since paid off.
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Old 05-20-2019, 07:09 PM
 
Location: Carolina Shores NC
6,701 posts, read 8,058,203 times
Reputation: 5048
We paid for college as we went along so our daughter wouldn’t have a student loan.
We bought her a new car when she got her first real job. A base model Honda CRV
We’ll help her get in her own home when the time is right.
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Old 05-20-2019, 07:22 PM
 
Location: planet earth
4,821 posts, read 1,838,502 times
Reputation: 10728
Wow. The days when parents expected you to make it on your own are truly over.

The amount of enabling has to have a crippling effect on people.

I hope this subject is being studied.
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Old 05-20-2019, 07:26 PM
 
Location: Central IL
15,230 posts, read 8,523,201 times
Reputation: 35647
I have to admit I'm amazed at how much so many of you have to give. I grew up in a very solidly middle-class family - but my sister had lots of expensive medical issues, as did both my parents that limited their savings. My mom got a small inheritance that she dedicated to my undergrad expenses (I think tuition was $25/hour!). I got the USE of a car when I was at home but did not get to take it to college and none (used or new) was ever bought for me. I married against my parents' wishes and considered myself lucky to get a $500 gift of cash AFTER the wedding. My dad died before I purchased a house but I would have been shocked if there'd been any money at all given for a down payment - I was nearly 30 years old, after all!

So sure, I'm a little jealous, I guess. Mainly what I hope is that those with so much to give to their kids realize just how much they've helped their kids and understand the much bigger picture that they have certainly put their kids on at least 2nd base in the game of life. Don't let them assume, or yourself assume that everyone else should do as well without being given all those things as a "kid".
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Old 05-20-2019, 07:58 PM
 
Location: Southeast Michigan
1,169 posts, read 971,859 times
Reputation: 1323
We let them buy their own houses. Helping the youngest who is still in college with insurance for car. We have helped all four with college and cars. They also have to work and contribute towards college. We feel that that's enough.
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Old 05-20-2019, 08:00 PM
 
Location: Florida Baby!
5,194 posts, read 670,130 times
Reputation: 3123
My dad paid for my first 3 cars (yes THREE), my college education and contributed to our first home. He was not rich by any means--he served in the Navy during WWII, was a crane operator in the heyday of U.S. steel mills in the 70s, and a maintenance man for a local hotel when the steel mill jobs went caput. My mother was a stay at home mom when we were in grade school. When we were in high school/college she worked for a commercial bakery on the line. My parents saved every penny and never went anywhere.

I didn't quite inherit THAT gene, but I did my own version of this for my kids (largely with money that was given to me by my dad)

I bought both kids their first cars (used vehicles) and paid CASH for both. For 27 years I worked at a large public university so my kids got tuition free. Kid # 1 lived on campus her junior and senior year which we paid for, kid #2 opted to live at home and got an apartment her senior year and worked part time when my ex moved out of state. She's now in the Air Force. Kid #1 decided to go to grad school so that was on her dime (I have no idea how she's going to pay for it) After she graduated she wound up living with me for almost 3 years. I didn't charge her rent but I made her pay monthly utilities (electric and cable/TV) I'm pretty sure her dad is still paying for her car insurance.

Now that I'm retired that will probably be the end of the free handouts from me. I have a small state pension and SS, an annuity and some dwindling investments. As longevity runs in the family, I'll most likely outlive my pension benefit. I think I pretty much "done my job." Now it's THEIR turn to take care of ME
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