Dear Dad, $chool i$ really great. I am making lot$ of friend$ and $tudying very hard. With all my $tuff, I $imply can’t think of anything I need. $o if you would like, you can ju$t $end me a card, a$ I would love to hear from you.
Love, Your $on Dear Son, I kNOw that astroNOmy, ecoNOmics, and OceaNOgraphy are eNOough to keep even an hoNOr student busy. Do NOt forget that the pursuit of kNOwledge is a NOble task, and that you can never study eNOugh.
A young man asked an older, wiser man, “What will it take for me to become financially healthy and responsible?”
The older man, who was a successful businessperson, smiled and said, “Two words: good decisions.”
“But how do I learn to make good decisions?” the young man asked.
The young man pressed for details. “But how do I gain experience?”
I’ve always liked this story because it succinctly describes how most of us learn to handle money. As it is in other areas of life, parents who make a habit of bailing their adult children out of bad financial choices only stifle their children’s ability to develop healthy financial muscles and to become responsible and independent with their finances.
If you help your adult kids financially, know this: you are not alone. More than 75 percent of parents give their adult children some form of financial help in one season or another. And at the same time, money problems can be a major source of concern and conflict between parents and adult children.
According to the groundbreaking research of Jeffrey Arnett in “The Clark University Poll of Parents of Emerging Adults,” money problems rank number one as the most common worry or concern parents have about their adult children. It ranked higher than choosing the wrong romantic partner, lack of work, and educational progress.[^22]
There is a high cost for ignoring the money dynamic in our relationships with our children. If we don’t discuss money openly with them, it won’t go away; it will only become more complicated. There will be hurt feelings and misunderstandings and potentially even a breakdown in the relationship. Money, perhaps more than any other issue, has the power to drive a wedge between us if we don’t talk about it with our children.
Chapter 7 Guide · Principle 7: Financial Independence and Responsibility Is the Goal
The High Cost of Money: Financial Boundaries, Loans, and Cutting the Cord
1. Core Principles from Dr. Jim Burns’ HomeWord Library
Karen and Eric came to my office for a conversation about what they called “the money pit.” Most people use that term for a high-maintenance home, car, or boat, but they used it for their twenty-six-year-old son, Lance. Their son was in the failure-to-launch stage of emerging adulthood. He was still on his parents’ payroll, and there was little reason to hope he would move to the next stage of responsible adulthood anytime soon.
The more they talked and pointed to Lance’s lack of financial responsibility, the more I sensed that the problem wasn’t entirely with their son. They kept calling him the money pit, but I started to believe they were contributing more to the problem than just money. Sure, their son was not being responsible, but it also became increasingly clear that they were enabling his irresponsible behavior.
“Why is it that you continue to pay your son’s way? Does he have a disability or some other reason he’s not able to support himself?” I asked.
“No,” Eric said. “Lance has never been a high achiever, but he doesn’t have a disability or learning issue that’s holding him back. He’s fully capable of working.”
Then out of the blue, Karen began to cry. “I’m afraid if we don’t keep taking care of him he will become homeless or start taking drugs or make a horrible decision with a girl!” she blurted.
Ah, now we were getting somewhere. Karen’s fear was real and legitimate to a degree. I didn’t question her desire to protect her son from bad choices. But Karen and Eric’s financial coddling wasn’t necessary. Instead of fostering independence and financial responsibility, they were reinforcing Lance’s dependency. Despite their love and best intentions, they had an entitled man-child on their hands. If things kept going the same way, it wouldn’t end well for anyone.
Back to Karen’s fears. Her fears were normal for any loving parent. No parent wants to see a child end up homeless, make unwise decisions, or lead a poor lifestyle. But this is where parents must face their fears and decide what is best for their child in the long run. If Karen and Eric were going to help Lance become a responsible adult, they needed to implement a tough-love money policy. The question they had to ask themselves wasn’t whether their son would be able to find his next meal or get a job, it was, “Will providing more money help our son to become self-sufficient, or will it prolong his dependence on us?” The only healthy response to a situation like Karen and Eric’s was to stop pouring cash into the money pit. They had to quit bailing him out.
Your adult children may not be irresponsible with their finances, but if you are still paying for their cell phone and other bills, that’s enabling. Quite often, love means saying no, even if you can afford to say yes. Saying no and stopping the flow of money to your adult children may be the most effective thing you can do to help them take their next step toward financial responsibility. Keep in mind that the first step in any healing process is often the most painful. I’ve always told my kids that “before freedom often comes pain,” and that’s why we must keep the great goal of financial independence in mind. Things will get better!
The old saying “Give a man a fish, feed him for a day; teach a man to fish, feed him for a lifetime” works in helping adult children become responsible with finances. We do this when we teach our children foundational principles about money and then help them develop a simple and practical plan. Unfortunately, most of us spent little to no time creating a roadmap to successful financial responsibility when our kids were younger. As parents of children and teenagers, we were just trying to make it through one day to the next. But all is not lost. If our adult kids are dependent on us financially, we still have the leverage we need to help them practice responsible stewardship. Doing so will not only enable our children to become financially accountable adults but also help them in their marriage and family relationships down the road.
Here are two things every parent of a financially dependent adult child can do: develop a clear exit strategy and foster independence.
2. Timestamped Video Conversations from the HomeWord Archive
▶️ Timestamped Clip · 18:25–20:33
Watch at 18:25–20:33 on YouTube ↗
Doing Life with Your Adult Children with Jim Burns
Your Adult Children with Jim Burns · 18:25–20:33 · Themes: Adult Children & Role Shift, Marriage Intimacy & Unity, Parenting Teens & Technology
[18:25] Well, that's just weird on two levels. One is, why is he still going to a pediatrician? And two... well, you shouldn't be making his appointments. You're still making his bed. You're still calling the school about a class or whatever it might be. That's just weird. But we do that. Our motives are usually right because we want to help our kids. But in our motives, being right and caring and loving our kids, we're actually enabling a generation. And if you enable a generation, they become entitled and they don't become responsible adults. And there's a failure to launch.
[18:56] So we have to be careful not to enable dependency. Hardly anybody in their right mind, maybe an emotionally kind of messed up person, might try to enable dependency. But we do that. We do that with money. We do that with how we try to help our kids. And, you know, again, the motives are good on our part, but it's not working because the bottom line always is the goal is responsible adulthood. Okay. So the result of enabling, like I said, is...
[19:23] is kids who are entitled, and when kids are entitled, there's a failure to launch, which moves to the fifth principle. Now again, we could spend so much more time on this, and I do in the book, Doing Life with Your Adult Children, keep your mouth shut and the welcome mat out, but here I just want to kind of give you a brief overview. But the fifth principle is move them from dependence on you.
[19:43] to independence. So if your real goal is responsible adulthood, then you want to make sure that you're moving them from the dependence part on you then onto independence. Again, let's take finances. So about 75% of parents help their adult children at one time or another. That doesn't surprise me at all. I'm not even down on that. I just don't think you should do what one family I know, they went...
[20:08] into debt, into their retirement fund to help their kids buy a house that's a lot nicer than theirs. It was kind of the kid's first home, but it was the dream home. And then the kids couldn't. They never did have the money to really pay those mortgage payments. And so they defaulted. And then guess what? There was estrangement in the relationship because parents were mad. But the parents should have never done that in the first place. So it's complicated, I know.
▶️ Timestamped Clip · 0:00–1:19
Watch at 0:00–1:19 on YouTube ↗
How do you foster your child's financial independence?
Dr. Jim Burns · 0:00–1:19 · Themes: Failure to Launch & Entitlement, Money & Financial Boundaries
[0:00] Remember that the high cost of money to a relationship is huge and don't make it complicated. Okay, so how do you avoid paying for your kids forever? There are people who have done this forever and they probably need to learn some of this. Foster their independence. Ask, will providing money help my child become self-sufficient or prolong the dependence on us? That's a question we've had to actually ask on some key things. Distinguish between needs and wants.
[0:30] Just remember when they were little, they had what they said were needs, but they were really wants. I want an ice, I need ice cream. I want, you know, this to go to Disney land, things like that. Well, you know what? We have to help distinguish that. And that's not always easy. And then set clear parameters. Be clear as possible. And give according to your needs. I mean, don't make yourself financially vulnerable by bailing out your kids. In fact, I know somebody who their kids really wanted a house.
[0:58] They actually went into their retirement savings. They helped them get their first house, which was really a dream house and more than the parents. And then what the parents had to do was not retire because they had to keep working because they were in such financial dire straits and the kids didn't need that fancy house. So give according to your needs and don't apologize for that.
▶️ Timestamped Clip · 34:45–37:05
Watch at 34:45–37:05 on YouTube ↗
Doing Life with Your Adult Children: Jim Answers Your Questions (Part 1)
Dr. Jim Burns · 34:45–37:05 · Themes: Anxiety, Depression & Mental Health
[34:45] and be the adult in the room and so a lot of times when i'm looking at parents i'm going no you're doing that wrong because again they're being pushy they're being defensive they want to get it right they want to do go tit for tat don't do that enter back into the relationship when you have an estrangement this is for the long haul the goal is to not be estranged so it's like a money people
[35:11] Tell me this. I guess I get this a little bit. I'm not a finance guy. But if you have compound interest, you make a lot of money on it because you put something in the bank and eventually it makes money. You put it in the stock market or whatever, you make a lot of money because it just keeps building. That's the way with this. The compound interest is not telling them that you're right and they're wrong because that's what we do with estrangement a lot of times. And so we keep digging a hole. What I think we need to do is, again, make it about them.
[35:40] And, you know, I'm sorry you feel this way, even if you can't apologize because they say you did something and you don't think you did that. I'm so sorry you feel this way. And it's so important for me to have this relationship with you. And I'm willing to not even talk about it if you don't want to talk about whatever they're into or whatever. It's I think it's harder with estrangement when they've done something where they have really rejected you. They've rejected you, not just in person like this lady, but they rejected your values because they they are, you know,
[36:09] living in a lesbian or a homosexual relationship, or they're walking away from God, or they hate God, or they're, you know, they're, they're, any of the things that, you know, bug us like crazy. We have to accept them as our children. That's what God does. God's not going around shunning people. God's going around sharing and showing love to them. That has to break his heart. It's hard to be in that. It's easier to walk away. I was just with a guy who's, who called his daughter, who is.
[36:37] uh living in a lesbian relationship said i finally got them to come to dinner and so i opened up we sat down we opened up i opened up the bible and i said this is an abomination what you're doing and i went well how'd that work out well they left and and i get it i mean i would agree more with him than i would with them but the point being you don't start with that what he should have said it's so great to be with you guys i've missed you so much and i love you so much
▶️ Timestamped Clip · 19:15–21:56
Watch at 19:15–21:56 on YouTube ↗
Helping Fathers To Parent on Purpose with Jeff Hamilton
Jeff Hamilton · 19:15–21:56 · Themes: Adult Children & Role Shift, Money & Financial Boundaries, Marriage Intimacy & Unity
[19:15] And I love, well, when I say a thought, it's your thought, it's your principle. Prepare your kids for adulthood. Yeah. Well, we want them to have the skills that are necessary to navigate what, in our culture, is becoming increasingly complex. There's so many pressures that we're responding to and that they encounter in life. I mean, who'd have thought kids would be entering into adulthood with hundreds of thousands of dollars in debt?
[19:43] Yeah. Already. Right. So pursuing education. They have all types of pressure. I think a dad's job is to give the kids intelligence. And I think that there's two kinds of intelligence that you pass on. One is experiential. Do you know how to juggle? But really, do you know how to whatever it is? Right. If you know how to run a skill saw, do they know how to do that? If you know how to put a paintbrush to a wall, do they know how to do that? But.
[20:11] There's also the process of emotional intelligence. Robert Lewis, I've taken on this concept from him in Raising a Modern Day Knight. It was that every boy, but really every child, needs to hear these three things from his dad. I love you, I'm proud of you, and you're good at dot, dot, dot, right? I love you is teaching your kids courage, right? Because courageous people say...
[20:35] I love you. Courageous people say, I'm sorry. They say, I forgive you. They say, thank you. They say you're welcome because it is about the communication of worth in each other. And that emotional intelligence, we don't think that we're training our, giving our kids emotional intelligence when we teach them as toddlers to say, please. When we're teaching them to share, when we're teaching them how to, so all throughout life,
[21:03] your kids, if they're going to be successful as adults, are going to need a set of skills that both are experiential and emotional intelligence that will help them not only be successful, but be willing to take risks. So good. Oh, so good. We're talking with Jeff Hamilton today. We're talking about helping fathers to parent on purpose. By the way, we have more...
[21:27] moms listening to this podcast. Then we have dads. So it's my guest, Dad, that it's possible she sent you this podcast. So maybe you should subscribe and also start getting some of the great insight here. It's so good to have you on. We're going to come right back. Be sure and check out all things Jeff Hamilton and Dad's Academy on our show notes for the podcast. Also, you can also go to dadsacademy.info and see it. I was just on really good. We know that...
▶️ Timestamped Clip · 9:18–11:29
Watch at 9:18–11:29 on YouTube ↗
Money Can Destroy Your Family If You Don’t Understand This
Dr. Jim Burns · 9:18–11:29 · Themes: Money & Financial Boundaries, Marriage Intimacy & Unity, Parenting Teens & Technology
[9:18] If they choose to give, we multiply their giving. So we'll give them a multiple on their giving. And if they spend, you know, that's on them. But for even the five-year-old, he's kind of now aware that things cost money, that he only has a certain amount. And for the 12-year-old, as we moved up, we can develop more advanced habits. So he now has an investment account with my financial advisor that's delegated, and he meets with them independently, actually, so they can have a more adult discussion. And I think that kind of apprenticeship, guiding people slowly,
[9:47] slowly, in age-appropriate ways, so that they're not just hit by the shock of the real world when they leave for college, is one of the best things that we could do as parents. No, I agree with you. I mean, even things like with our girl, I have all daughters, so we have no hormones or job in our life, of course. But with our daughters, when they were younger, we gave them money to buy clothes. Instead of buying the clothes, we said, look at this is the semester, here you go. And it wasn't a lot of money, but one went to Target and bought five outfits, and one bought one sweater.
[10:15] And then she was like, I don't have any money. I need more money. Now you're going to have to work for it because we gave you the same amount of money. So she buys the outfit from one of the outfits that my daughter who had bought it at Target, she sold it. And then she went and bought another outfit. It was just funny how that works. Well, and you know, one of the practices for kids that we picked up even writing this book.
[10:33] was a family giving meeting at the end of the year. And I've seen this with some of the most functional wealthy families that I've seen. And it's, we all got together. We picked six charities. The kids could choose what they were going to give to. And it was transformative for us. And it's, it's embedding a sense of generosity with them while building relationships among us for service to others. And so doing it together as a family can be really transformative. No, that's so, so good. You know, it was funny. You, I maybe be, I liked your, your, your.
[11:03] content so well because we did that in our family. We had an experience where our five-year-old at this time, I gave everybody a $100 bill. They had never seen a $100 bill, and this is cash. And I gave it to him, and I said, now you have 24 hours to figure out where you want to give this. This is money that we're giving. And so we come back together, and our five-year-old is crying because she lost the $100 bill. So what was supposed to be such a great...