If parents aren’t careful, financially supporting their adult children could harm their retirement — and damage their kids’ own financial development.
Of course, living in the time of Covid-19 brings its own set of unique circumstances. Many young adults are reeling from the economic fallout of the pandemic. While the unemployment rate decreased in May, it still sits at 13.3%.
Parents may want to help to help. They’ll just have to make sure they do it right.
“They cannot under any circumstances put their own retirement at risk,” said certified financial planner Tom Henske, a partner at Lenox Advisors in New York. “There is always another option.
“Even if that means that their kids come to live with them rent-free while this is going on — that is better, because once the money is spent, it is not coming back.”