Helping or Hurting?

"The biologist and intellectual E.O. Wilson was once asked what represented the most hindrance to the development of children; his answer was the soccer mom.  But the problem is more general; soccer moms try to eliminate the trial and error, the antrifragility, from children's lives, move them away from the ecological and transform them into nerds working on preexisting (soccer-mom-compatible) maps of reality.  They are now totally untrained to handle ambiguity." - Nassim Taleb from his book Antifragile

While the quote above is directed at soccer moms I personally think that it could just as easily have been directed at modern day dads or parents as a group.  As parents we love to give our kids a helping hand and mostly this is fine but often times the giving is taken too far and for too long and not only does this jeopardize our retirement but it also gives our kids a false sense of entitlement and security (they become fragile) and this is bad for the parents and their offspring.  A study showed that the average retiree in the United States has $111,000 in their retirement account at retirement age.  A rule of thumb is that you can fund your retirement with roughly 4% of this balance each year meaning that the average American can only draw $4,440 a year or $370 a month from this balance.  This is hardly enough to pay the groceries for a month let alone service the mortgage, car payments, taxes, medical care and any form of meals and entertainment.  However regardless of this 1 in 3 parents are providing financial assistance to adult children.  In comparison only 1 in 5 provides support to their parents so the argument that your kids will support you holds little water.

Well I am certainly not saying pull the rug out from under your children's feet but I would definitely make sure that you can afford the support that you are giving.  I have numerous examples of couples in the retirement age bracket that continue to work 50 plus hours a week to not only maintain their life style but the life style of their grown kids.  This is crazy.  Not only does this hurt you but it also hurts the kids.  It hurts you because you are unable to put aside the amount required to retire and it hurts your kids because you are teaching them to live a life beyond their means so when the day finally does arrive where you can no longer work both of you instantly have the rug pulled out from under you.

My thought is to allocate spending on your kids in ways that benefit them *(make them antifragile).  Our job as parents is to give our kids the best chance to succeed and so for example spending on a child's education is certainly one way that can achieve this goal.  On the flip side paying their rent, buying them chic clothes or a flash car is tantamount to feeding animals in the wild.  It is detrimental to both of you - in the wilds not only does the animal become dependent on the handouts but it becomes aggressive attacking people when it becomes hungry.  Now I am not opposed to the odd handout at say their birthday but making monthly payments to support a life style that neither they nor you can afford is completely ridiculous.

It appears that parents are doing everything possible to protect their kids from the evils of the world including making sure that when they leave the house that their baby is taken care of financially so they can live like they did at home.  While an admirable goal it is foolish and does not help them in the long run.  Worse still if you empty the piggy bank you are now a huge burden on them (assuming they actually help you which as the earlier paragraph shows is a long shot) and their income so you actually end up dragging everyone down with you.  This I am certain is not what the intention is so in order to help everyone in the family make sure you are setting aside enough to remove this potentially huge burden.  Help yourself to help them and who knows in the end they may receive a nice handout when you die and they find that the coffers are not empty.  Now that would be far more beneficial to all!