Watching Your Wallet: College Grads & Parent Support
BATON ROUGE, La. (WAFB) - For parents, there comes a time when young adults start paying for everything on their own. but when should that be?
It’s tough for any parent to decide exactly when is the right time to cut off their kid and have them start paying for everything on their own.
It’s been a debate for a long time: should your college graduate be financially independent now that they have their diploma? It’s a big deal because four million new college graduates were just added to the economy. Whether your college graduate should pay their own way depends on who you ask.
Many parents feel it’s time - after all, that college graduate is an adult now. But many new graduates say some bills should still be paid by mom and dad for a while.
Another factor to consider is whether your brand-new graduate has a job lined up. Of course, you want to help your graduate get started out well and not be saddled with debt, but you must remember that you’re trying to save money for the years you don’t have a paycheck coming in - your retirement.
Savings.com has found that on average, parents are spending $1,400 a month to help their adult children. That’s helping them pay for cell phone plans, insurance, rent, or other things.
Bankrate found that half of parents with adult children are not paying off debt as quickly or adding to emergency savings because of this financial assistance. And many parents admit it has hurt their retirement savings.
So, as you navigate this conversation with your graduate, keep in mind that communication and planning are key. Talk with your graduate about the expectations you have for them to start shouldering their own financial responsibilities and then stick to that plan.
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