Bae, you have one child and can afford it so really a no brainer.
We will talk around him, haha. I agree with you.
We have a similar situation in my family. My cousin,who has millions, has a young daughter going for her doctorate. He is funding it.
While he isnt a self made millionaire, exactly, because he did inherit a ton of his wealth, he did always work, save, and invest as well as live frugally to add to the stash. Anyway, from bits he has said here and there, he seems a little miffed that she sails through life expecting things to go smoothly and money to be forthcoming. I dont know her, but I cant help but think she saw a middle class life on the modest side, and adopted thise values. I doubt thst she is a spendthrift, yet, she is going thru many years of grad school on her dad’s dime. i am guessing that he struggles with giving her too much vs. requiring her to be independant.
I think he is doing the right thing since she seems to be a very bright, popular, busy, and happy young lady. The money is there, so why not use it for worthwhile things?
It is in trust for her, she doesn't receive it until she is 25, unless I choose to allocate her funds from it for educational purposes.
I have involved her in the investment strategy for it over the past several years, she has 4 years to go until she gets it, my intent is to help her learn more about capital management, taxes, and that sort of thing. It is going quite well, she just submitted to me today her proposed budget for her coming first year of grad school overseas, and I will fund it quarterly as she presents updated reports.
The goal is to preserve as much of her capital as possible so she can live the life of an underpaid post-doc and then college professor, much as her grandmother did. And to teach her how to continue managing the capital so she can be relatively independent.
This approach is also much more tax-efficient for the moment :-)
I suspect if they are actually wealthy it might work as the slack is there (assuming the kids just want supplements to their income and aren't really far gone - drug addicts and the like, then they'll just self-destruct).I am really wondering how widespread EOC of the children of the wealthy is...
It's middle class parents trying to support a failure to launch kid that isn't going to work because the money really isn't there. But I still suspect help with downpayments is fairly widespread.
Trees don't grow on money
We funded 95% of the kids college. They did not qualify for any loans, but I wanted them to pay at least a token amount of their own money. But I didn’t want them to have school loans to deal with. We also bought them several cars and have helped them a little here and there.
But they also never moved back after college and have been pretty much on their own since. Except for the two months one did live with me while buying a new house down here.
i don’t mind helping a little, they are most likely going to inherit a nice sum anyway, why not them have a little here and there when they could use it. I just don’t want them to depend on it.
Hubby's sister to a tea. Parents money gone, house fully mortgaged (they bought it 39y ago) and they still work at 75 and 77yo. She moved away as did the 3 adult sons....sigh.....................
We asked for a small short term loan on 2 occasions. Denied. Don't say parents treat their children equally....my Dad gave us the first loan request-we paid it back over the 5y agreed upon with interest at current rate. 2nd time we got a small commercial loan short term. I know we're better off for it.
I see college educations and house downpayments as great if you can swing it for all of your children equally. If not, you can't.
In colonial America it was completely common for young couples starting out to get a house built for them. Often, it was smallish. Then, they moved into the larger house as their families grew and the grandparents went into the smaller house.
It's not like this is new behavior, for people to help their children to start out in houses.
I don't think it hurts the children, unless they cannot swing the payments etc on their own. I thought that was what Stanley was writing about with the economic outpatient stuff--the grown children who never grew up because their parents were funding their lifestyle on an ongoing basis.
This is very different from those parents dealing with disabled children who grow to adulthood. A whole 'nother kettle of fish. I learned recently that my great grandfather worked until he was 60 in a career he hated to care for my disabled great uncle. When the uncle died, he practiced law and then became a judge.
This was a hundred years ago.
Many parents still face these decisions when they have disabled children.
Yes big difference between helping kids get a start in life versus making them dependent on you.
There's also EOC in the other direction, I suppose. Parents in the past typically planned on their children help support them in their old age.
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