Be sure not to hurt yourself when giving people money

With the latest recession there are a lot of young adults who are seriously cash strapped. They’re still paying off student loans, but also now have to pay a mortgage, credit cards and auto loans. Many of them are without jobs. They are turning to their parents for help. Should you help them?

Here’s a few things to consider:

Are you financially well off despite the down economy to help your kids without hurting yourself? We know that a lot of people want to save money and give it to their kids upon their death, and that’s because when you’re gone to don’t need it. If you give it to them now you’re potentially jeopardizing your own retirement future. Even so far as to mean that you have to go back to work to pay for your children.

Are your kids being irresponsible or is it just bad luck? There’s something to be said for learning the tough lessons, but if your kids already know about spending wisely and just got in a bind because of poor luck and bad timing then helping them is mentally easier. If you’re just bailing out a kid who never learned how to live within his means then you’re only enabling more bad behavior and you’ll be on the hook forever.

Are you able to give them assistance tax free? The government allows you to gift a certain amount to each member of your family without them having to pay taxes on it. I think this year its about $13,000. If your kids need more than this then they may have to pay taxes on whatever you give them above this mark. That tax burden could be an issue for them in April.

Whatever you decide just be sure that you aren’t ruining your own life. There’s a reason the airlines ask you to put your own oxygen mask on first.

The author enjoys writing freelance for a variety of websites including http://www.professionalgarmentsteamer.net which has a great page on rowenta garment steamer.