“Often, when our kids call us in a state of emergency, it seems as though money is the only solution.”One of the greatest gifts we can give our kids is independence. It builds self-esteem and confidence while we achieve the benefit of knowing that they will be able to look after themselves when we’re gone. But many parents with grown children feel like they have become the Bank of Mom and Dad, frequently being asked for loans or handouts. If your child struggles with a mental illness, you are at an increased risk of finding yourself in this position.
The issue of giving money to your kids is highly personal and every family’s dynamics are different. The main thing I want to encourage you to do is to ask yourself if you’re giving money because it is a well-thought-out choice or if you’re doing so because your grown child is in trouble. There’s a world of difference between strategic funding and financial rescue.
| Strategic Funding | Financial Rescue |
| Non-emergency situation | Emergency situation |
| Time to think about it | Immediate decision required |
| Agreement between parents | Parents may not agree |
| There is value in the expenditure | The expense wipes out a problem or fills a desire |
With respect to the last item, value implies that something good will come of the expenditure in the future; for example, investing in a college course or training program that will help the young person get a job. Medicine or therapy are similar examples of valuable expenditures. The converse of this would be paying off your adult child’s court fine (wiping out a problem) or providing rent money because your adult child took a vacation he or she could not afford (desire).
Strategic Funding
As the name implies, strategic funding is well-thought-out. It does not occur on a case-by-case basis but, rather, is carefully planned. Part of that planning includes considering the contribution of the grown child. Here is the strategy I recommend:
Step #1: Assess Your Own Finances. How much money can you give your child and for how long? Please do not overlook the latter part of this step. There is a difference between six months and some indefinite period of time that could potentially never end. Establish an end date.
Step #2: Prioritize Needs. The top priority should be maintaining mental health with a goal toward as much independence as possible. There are several options for providing therapy and medicine.
Under Age 26: You can add her to your own insurance as a dependent. There will be the expense of a premium and co-payments for doctor’s appointments and medicine, but you may feel that this is a wise investment.
Eligible for COBRA from a previous job: You may agree to cover these payments. COBRA is expensive though, and there will still be co-payments for psychiatric and therapy appointments.
State agency: Do not be discouraged if they tell you there is a long waiting period or that a lengthy evaluation period is required. The sooner you help your child get started, the less lost time you’ll face down the road. Your child may also be eligible for Supplemental Security Income (SSI), Social Security Disability Insurance (SSDI), or Medicaid.
If you need to pay cash for mental health, discuss this with the professional. Many will adjust their fee based upon what you can afford. Make sure payment goes directly to the doctor or therapist. Also, ask the psychiatrist to consider prescribing generic medicine first since it will be more affordable. If your grown child refuses to accept mental health care, there is not much you can do. But they may come around.
Step #3: List and Prioritize Expenses. If your child has any assets to sell or any savings, insist that they participate in their own salvation by using this money to pay for as many expenses and debts as possible. Moving into less expensive housing can help, but don’t let it be your house.
Step #4: Legal Matters and Debts. Your child should pay for any debts or legal fees they incurred. Let your adult child pay these off directly–do not involve yourself by paying them off and then expecting repayment.
Step #5: Come up with a Grand Total. That way you will know how much you are investing in the project.
Financial Rescue
In the case of financial rescue, the question of need is usually put to the parents in a crisis scenario. Your daughter calls and says she must come up with $1,200 by tomorrow. She signed a lease on an apartment that she was to share with a friend, but the girl moved out after they had an argument. The landlord is demanding the money or he will evict her.
Often, when our kids call us in a state of emergency, it seems as though money is the only solution. More, your grown child seems so grateful when you write that check, so determined to do things right from now on. Or she promises to pay you back at the end of the month, and you feel good because the crisis is resolved. But at the end of the month, she’s short on cash. Now it seems like she’s the one doing you a favor.
One interesting feature of this dynamic is the subtle resentment that builds in the grown child. Some parents interpret it to mean that their offspring doesn’t think they are doing enough, but I think the resentment has a different source. I believe adult children deep down resent their parents for not believing that they can take care of themselves. For the parents who thought they were helping, it is a no-win situation.
If you want to stop being the Bank of Mom and Dad, there are ways to graciously extricate yourself from that role while granting your grown child the opportunity to become self-reliant. Note that I used the word opportunity. You cannot make your child self-reliant; but you can provide the opportunity.
How to Stop Giving Money to Your Grown Child
Parents sometimes find they can’t refuse requests for money because otherwise their child will be angry with them. It is a selfless act to be able to tolerate a period of estrangement while we allow our children the chance to mature and become adults. It can be strikingly like an addiction: you know you should stop; you regret it later; but somehow, you always find yourself giving in. Or maybe you simply can no longer afford to keep giving.It helps to prepare a few key phrases for the next time a request comes in. For example, “I can’t afford to give/lend you money anymore” or “I know you’re smart and resourceful; you’ll figure something out.”
Be prepared to repeat yourself quite a bit. That’s okay as long as you get your message across. If you can’t bear to say any of the preceding phrases, insist upon taking a day to think about it. If your grown child can’t wait a day, know that you are indeed being played to react to the cry of emergency. Resist.
You will need support if you are going to take this courageous stand, so be prepared. You may be able to find support from a friend, your spouse, or a support group. Keep in mind that if you’ve been giving your son or daughter money, you have been complicit in the arrangement. It’s okay to tell yourself and even your child, “I’ve made a mistake in the past by giving you money when I know you’re capable of taking care of yourself. I need to stop.” Just remember that you are abruptly changing the rules, so your child may initially feel abandoned. Continue to provide plenty of emotional support and encouragement. But stick to your guns. If your child wears you down, the message will be that if they’re willing to debase themselves enough, you’ll give in.
The Trouble with Lending Money
Every time you lend your teenager or grown child money, you deprive them of the opportunity to behave in a mature, responsible manner. This can be as innocent as giving your fourteen-year-old an advance on their allowance. You are establishing a precedent. At some point or some sum of money, you will need to explain that the Bank of Mom and Dad is closed, and it won’t be pleasant. In general, I recommend against lending money because it leads to over-dependency and resentment.
Another reason to resist lending is that you may need repayment in the future but not be able to collect. Many parents are postponing their retirement until a grown child can repay a debt or come off of their payroll. Your first financial responsibility is to yourself.
But let’s say you can afford to help your child out financially. There is a way to do this without incurring the preceding problems. I will explain this next.
Sometimes Giving is Warranted
Sometimes offering financial help to an ill child is warranted, particularly if they are doing all they can. For example, let’s say your daughter is twenty-four. She was fine until six months after she graduated from college. She had her own apartment and worked full time at a job she loved when she suddenly became paranoid. Heartbreakingly, she was diagnosed as having schizophrenia. Over the past two years, she has been taking medicine, but she is far from being the person she used to be and is able to work only fifteen hours per week at a low-paying job. Still, she sees her therapist weekly and actively participates in her own treatment, driving herself to her monthly psychiatry appointments. You have chosen to let her live with you because she is respectful and helps around the house. If your situation is anything like this, I hope that this article hasn’t caused you to doubt what you are doing. You are absolutely right to help your daughter out. She has taken responsibility for herself and is doing her best. I’m sure you’re proud of her efforts.
The Bottom Line
If you decide you want to start doing things differently, take the time to think it through. This article may have stirred up some indignation on your part. If so, try not to lash out at your adult child. Remember, you want to be calm, firm, and clear. If you feel guilty about withdrawing or withholding money, consider that a little guilt is a small price to pay for living healthier. Along with the guilt, you may encounter an unexpected emotion: disappointment. The sense that you are not really needed may be more overwhelming than the guilt. But you can do this. It’s a wonderful last gift from mom and dad.