Will Your Adult Children Ruin Your Retirement?

Here are three real-life scenarios from my own friends or family:

Theft: the youngest child of 7, a 27 year old male, has stolen nearly $50K from his parents. Most of the debt came from digging into Mom’s purse (typically left on the dining table), grabbing the debit card, making a few purchases, and returning the card before it was missed. The son became savvier with his theft and eventually took screen shots of all the credit cards, learned to forge her signature (which his latest girlfriend would sign), and discovered the source of Mom’s “secret” hiding place of her pin numbers: in the back of a pocket calendar. Even when Mom repeatedly replaced her debit and credit cards, the son had discovered her patterns and habits. Mom is now pressing charges, but the authorities need proof that the son is the primary source of the theft; the investigation is now in its 7^th month.

Drug addiction: a daughter aged 25, has always been a carefree, rule-challenging child. At age 16, she got a boyfriend six years her senior, thrilled she was now among the “cool kids” in high school. Unfortunately, the daughter chose poorly in her desperation to fit in: the loser boyfriend introduced her to drugs (fentanyl), got her pregnant and addicted, though no one knows which happened first. As the pregnancy progressed, the daughter sold any family belongings she could get her hands on to pay for drugs and “fun” with the boyfriend. By the time their grandchild was born, the parents lost $85K in antiques and collectibles. The daughter was unable to care for her child, declared she didn’t want to, and now the grandparents are raising their grandson. The daughter has been in various detox and treatment centers, at an additional cost to her parents. And that loser boyfriend? He died from an overdose in 2018.

Debt: a daughter, age 21, bought a car with her first job, as a pizza delivery driver. In addition to the new-used car, she wanted to move out of home and into her “own place” with friends. Despite wisdom from her parents, she purchased a mobile home, cashing in her college fund to do so. The friends “suddenly” changed their minds once the purchase was complete and how the daughter is paying for the mobile home by herself. In addition, she has a soft spot for stray or injured animals and rushes any wounded creature she finds to the vet, building upon her debt. Oh, let’s not forget the new boyfriend that moved in to share expenses, borrowed her car, crashed it, and has no money to pay for repairs. Daddy is covering most expenses and upon a confrontation, the Dad approached the boyfriend saying, “You need to get a job, help with bills, or get out!” The loser boyfriend said, “I don’t see it as a rush since you bail her out every month.” Eviction processes began immediately, but the daughter has a soft spot for stray animals and doesn’t have the heart to kick him out.

There are more stories I can share from within my own circles including unemployment, living at home too long, gambling, and parental/elder abuse, but the situation is frighteningly common—and often too close for comfort. You may be experiencing similar scenarios yourself or you know others who are.

The worst part of it all: parents come to the rescue, putting their own savings, lifestyle, well-being and retirement funds in jeopardy. Take a look at these cringe-worthy statistics provided by Merrill Lynch in their document, The Financial Journey of Modern Parenting: Joy, Complexity and Sacrifice.

How do we get ourselves into this mess? The reasons are many, based upon love for our children and wanting to help, but it is as much psychological as it is emotional and financial. I am not an expert in any of these areas but am speaking from a parent caught in similar situations (read my blogs and you’ll understand more!) Add a grandchild to the picture, and the heart-wrenching choices become greater.

A Different Form of Scamming

The situation sneaks up on you. How are we to know when or if a small help (Mom, will you help pay for car repairs) will lead to a parental addiction of its own (Parents paying living expenses years later)? Once we find ourselves in this financial loop of emotions and contributing to the problem, what can we do?

Curtis Bailey, a lawyer licensed in Missouri and Illinois for estate planning, co-founder of Senior Scam Action Associates, and the Scammercast Podcast, frequently counsels families on these issues. Here are his suggestions on how to prevent the problem and how to protect yourself:

• First and foremost: The sooner you SAY NO, the better it will be for everyone.
• Before you say yes to anything, take a critical look at your children. Ask yourself the hard questions: does their personality and habits convey trustworthiness? To get the REAL answer, a parent can NO LONGER turn a blind eye.
• Recognizing behaviors—being honest about behavior; recognition sooner rather than later.
• Tough love: make choices that need to be made. This will benefit the adult child more than coddling. We’re adults and they’re adults. If a grandchild is involved, tell your adult child that you will report the situation to court and petition for guardianship. There are times avoiding what truly must be done makes the situation worse. (Another person I know recently drove her son to court to face the warrant for his arrest).
• Your willingness to help must be in YOUR best interest. Will it create a financial hardship for you? Will it cause you to forgo something for the sake of your adult child? Will your rescue enable repeat behavior from your adult child? *Keep tough and avoid promises of lessons learned.
• Offer options: ex. I can pay the granddaughter’s after school care but you must dump Netflix, season tickets to the amusement park, and/or some other treat. *This requires follow up*
• Added protection: to maintain your vigilance, take these steps to avoid theft and other negative circumstances regarding your adult children:
  • Always observe
  • Track everything
  • Collect and maintain your information
  • Keep all financial and legal documents safe and locked down
  • If situations change, do not hesitate to modify your POAs. Be wary on whom you give the “keys to the kingdom”

Scary, isn’t it? As much as we love our children and want to help, there comes a time when we must fend for ourselves as we expect them to fend for themselves. And as heartbreaking as it is, you need to realize your adult children are scamming you.

With love and understanding,

Kristen Edens

cover photo courtesy of Skitterphoto from Pexels