More parents than ever are helping their grown children financially.
Charles Schwab surveyed 1,000 parents of 23 to 28 year olds and found 41 percent are providing some financial support to an adult child.
"Most of the people we polled told us they were fully independent from their parents by the age of 25, yet many of their kids today aren’t achieving independence until they’re 30 or even older," said Carrie Schwab-Pomerantz, president of Charles Schwab Foundation.
Most of the parents blame college debt and the lack of jobs.
According to a recent article in the Wall Street Journal, “The unemployment rate for 20- to 24-year-olds stands at about 15%, compared with 9.7% for the whole work force. Then there is the worsening indebtedness problem: About two-thirds of 2008 graduates had student debt, and that debt averaged $23,200—up from $18,650 in 2004.”
I admit I was fortunate not to have any debt when I graduated college, thanks to scholarships and my parents. I also worked all through college, not just during the summer.
I hear a lot of parents say it’s difficult for their children to get jobs when they’re only home from school for two months during the summer. However, working while you’re in school doesn’t require that much effort.
Here’s an example of one of my easier jobs in college. I took a class to become certified as an aerobics instructor and taught aerobics throughout the week. I set my own hours so they wouldn’t interfere with my classes and pretty much got paid to workout.
Some of what makes children able to survive on their own may start younger than you think.
That same Charles Schwab survey found “parents whose children regularly did more household chores growing up were more likely to view their young adult children as "very financially responsible" (53 percent) as compared to those whose children did fewer or no household chores (46 percent and 39 percent, respectively). Parents of children who didn’t do any regular chores also see themselves as having been poorer financial role models.”
Young children may not like hearing it, but instilling that work ethic at an early age may make them more responsible as young adults.
So what should you be doing now before your child goes onto college?
Parents in this survey say their 20 something year olds still need help on learning how to budget (48 percent) and live within their means, save money (42 percent) and invest wisely (33 percent).
Women seem to be getting the message. According to the survey: “Women are more likely than men to have made recent, positive changes in their financial behaviors and habits, including talking to their children more about money management (59 percent vs. 47 percent, respectively).”
There’s no time like the present to teach your children lessons about money.