nhcycling
Recycles dryer sheets
They are adults now, let it go! Get off those joint accounts, it’s their business now. You have launched them into adulthood, your job is done. They are accountable to themselves only, not you.
I think you are good parents to care so much about your children and their financial well being. Kudos to you for that. Yes, you might lighten up in many different ways, as others already have suggested; however, we don't know much about your family history and relationships, do we? Only you can decide what feels right and will work for them and for you.
We know that they worked in college and during the summers (good for you for encouraging that!), they work hard now. Their peer group social interactions are really important right now and their spending might be stretching to keep up for now. Over time, however, the peer group changes as individuals mature.
So, perhaps lean back (definitely give up access to their bank accounts) and wait, keeping the lines of communication open and continuing to provide advice as requested.
Marriage, a first house, their first health scare that will be actually nothing at all -- these will likely get them to focus more on their lack of immortality and just how relatively short a lifespan is. Usually this happens in their thirties. So, plenty of time.
It would be lovely if you could update the forum from time to time (using this thread) and let us know how it's going.
-BB
This is a very perceptive post. It turns out they have both had serious medical issues that we think are for the most part resolved (only time will tell). Perhaps this is why we are so close to them and also border on coddling/controlling them so much. When they were at the bottom with their issues, we were truly their only lifelines.
Take your name off their accounts!
They are adults now and need to learn.make mistakes on their own. You can be there to help as requested.
You have done your part as far as teaching them and can continue if they ask.
It is hard as parents to watch our children make mistakes or do things we wish they wouldn't. But that is how they learn.
Be there to lend a hand or help them if they fall--but at their request.
+1 You need to let go and let them find their own way... you can't push a rope... or adult children.
They were brought up in very comfortable circumstances. We have always been concerned that it would be difficult for them to adjust to a much more modest lifestyle, and also concerned that they might not be as motivated since they can probably deduce that they will inherit a large amount of money some day.
Both sound like they are well on their way to becoming independent adults. Don't deny them the opportunity to continue that journey, which almost always involves making mistakes along the way.
So it seems I need to take myself off their accounts. This has been in the back of my mind, and I know it isn't typical to have access, and I also know they need to develop their own independence to a greater degree.
I don't think they feel entitled, they are very grateful for what we have given them. We are a close family, and they do rely on me for financial (and other) advice. I do not think they resent us knowing some of their financial details, and I don't think this makes them more likely to overspend. Just to be clear, we really don't know what they're spending money on because we don't see the credit card statements (and almost all their non-rent spending is on a credit card), just the amounts.
They were brought up in very comfortable circumstances. We have always been concerned that it would be difficult for them to adjust to a much more modest lifestyle, and also concerned that they might not be as motivated since they can probably deduce that they will inherit a large amount of money some day.
The suggestion from nwsteve about funding a Roth instead was brilliant. If we continue to gift them money, it will be in some form of retirement savings as long as we can avoid exceeding limits.
Happens on forums, but I never get these threads. Where an OP asks a question, but has an answer in mind all along - looking for validation from strangers, not other views. And withholds, and later shares pertinent details. No harm, but why?
The "answer" I had in mind was just a nagging thought, I wanted to get views of other people, some of which are not exactly strangers since I have read other posts they have made. I didn't "withhold" any information, another poster made me realize it might be a factor, so I shared it.
....her brother, who was a liberal arts major and lives in a LCOL place (also with a salary to match). They both contribute to retirement plans through work, but at modest levels....
One thing that you may want to check out if you haven't already done so is the retirment savings tax credit (Form 8880). Essentially, the federal government offers a tax credit for low earners who make retirement savings. The credit is scaled, with lower earners getting as much as 50c for each $1 of retirement savings and as low as 10% for higher earners.
DS's AGI is slightly more than the 50% threshold so what we do is deductible IRA contributions to reduce his income so that he qualifies for the 50% credit and then Roth contributions to optimize his credit.
So by contributing 2x his tax to retirement accounts, he gets a tax credit that totally offsets the tax and gets a refund for every dollar withheld. For example, this year his tax was $825.... absent anything his refund would have been $1,125. However, by making $1,650 of retirement savings contributions he got a $825 tax credit that reduced his net tax to zero and he got a refund for $1,950. For him, the retirement contributions are just moving money from one pocket (taxable savings) to another (tIRA and Roth).
Can't beat "free" money.
Thinking back to my own life, I didn't get serious about my finances until I was married and had children, which was when I was nearly 30. At age 31, I went through a divorce which made it very difficult financially for several years. I got remarried at age 34 and that's when we both made it a huge priority to get out of debt and contribute to retirement. So starting late, doesn't mean that you can't retire early and live the life you want. I think you need to quit worrying over their finances, provide advice when asked and let them make their own mistakes.
...snip..
She unwittingly became an enabler and cannot seem to stop. She knows better after spending her working life as a personal loans officer in a bank. We hate to sit back and see this unfold.
I do not think that you do your children or yourself any favors by coddling them. There is a huge difference between helping and becoming entangled in the financial affairs of your children.