Retirement is supposed to be relaxing and work-free. You shouldn’t have to worry about money or your income with the right amount invested in your retirement vehicle(s). But what happens when your children need a helping hand financially? Do you put your retirement first? What about their needs? More times than not, you can put your children’s needs before your own. However, this can be incredibly detrimental to your retirement efforts. Here’s how to make your retirement more child-proof to ensure maximum savings during your journey.
5 Tips on How to Make Your Retirement Child-Proof
When you think of retirement, you think of a more relaxing, stress-free time. You get to reap the benefits of the money you invested in your retirement. But sometimes life happens, especially when it comes to your children. Take a look at some of the ways you can make your retirement child-proof.
1) Limit Your Financial Support
Many people provide financial resources to their children, even after they’re grown and moved out.
Whether your child is:
- in college
- just graduated
- getting their first apartment
If you’ve made a habit of providing them with financial resources, they’ve likely made a habit of expecting the support.
This can create an unhealthy dependency that can also create unnecessary gaps in your finances; including your retirement savings. This is especially impactful if your children keep making poor financial decisions that you’re fitting the bill for. This only teaches them that it’s okay to be irresponsible with their money because mom and dad will cover the cost of any mistakes they make.
Child-proofing your retirement requires some tough love. Think of this way: you must help yourself first before you can help anyone else. If you spend all of your money fixing your children’s mistakes, you’re damaging both yourself by exhausting your funds and your child by teaching them to be dependent on you for the rest of their life.
2) Make Your Retirement First (Even Before College)
You’ve likely put college funding on your list of financial priorities. While it’s understandable that you’ll want to mitigate some of the costs associated with your children’s educations, putting this type of saving before your retirement savings isn’t helping anyone. Your retirement should come first. This isn’t being selfish or self-centered; in fact, it’s the opposite. There are several ways to pay for college, whether they’re going to art school in Dallas or a community college closer to home; but there are limited options on saving for retirement.
Saving for a peaceful retirement will ensure that:
- you don’t have to return to work halfway through your Golden Years
- you’ll be able to rest and relax and be there for your children in the future
- you’ll have plenty of money to cover medical expenses to keep you healthy and keep yourself from being dependent on your children later in life
For a clearer picture of how much you should be saving for retirement and what investments work best for your financial situation, you may need to hire a financial advisor to help you plan.
Financial advisors will assist you in:
- crafting a retirement plan
- where to invest your money
- providing advice during your journey
You can compare financial advisors on Carefulcents.com for a better idea of what they do and how much their services will cost.
3) Don’t Give In
One of the most difficult things to do is to not give in when the kids start laying it on thick. When crisis strikes, if your children depend on you to support them financially, they’re not learning any valuable lessons on responsibility. It’s okay to offer help and support in times of crisis, but support comes in many forms; not just financial support.
Remember that your retirement comes first. If your retirement savings are maxed out for the year, then feel free to lend a hand, but otherwise, put your own financial future before anyone else’s. No one is responsible for your finances but you.
4) Make Your Retirement Child-Proof by Setting Clear Boundaries
To avoid any complications, it’s crucial that you set very firm boundaries with your children when it comes to money.
Set boundaries on:
- how much you’ll let them borrow or just have (if any)
- when it should be paid back
- how you expect your loans to be paid back within a certain timeframe
As parents, we tend to give our children extra leniency. However, with money, it can make the relationship a bit more complex.
Make your boundaries firm, but most importantly, sit down and discuss them with your children. You can’t expect people to know what your boundaries are if you don’t tell them. So, it’s important to make communication a priority so everyone’s on the same page.
5) Start Financial Education Early On
The best solution to any financial problem is early education. The sooner you begin to teach your children better money management skills, the better off they’ll be. They’ll learn to handle their money in a responsible way and avoid those situations that would have dug them into a financial hole, to begin with.
Start by teaching your kids:
- the benefit of a budget
- how money flows in and out of a household
- good saving habits (you can start with a simple piggy bank)
Remind them of the value of money and how good financial habits will benefit them for years to come.
It’s not too late to address these issues with adult children, either. If you’re a master at budgeting or household management, don’t be afraid to share your knowledge with your kids. You’ll be saving them money and providing valuable information while securing your own finances against unnecessary borrowing.
Make Your Retirement Child-Proof: It’s Your Turn!
Dealing with children can hit pretty close to home. However, it’s important to remember that teaching them how to better handle their finances is a better idea than enabling them to become dependent on your money to survive. Always make your retirement the first priority!
Are you ready to teach your children about finances today so they can make better financial decisions tomorrow?
AUTHOR LaTia Longuemire
My name is LaTia Longuemire. I enjoy writing, singing, and cooking in my spare time. My passion is helping others. At this stage in my lifetime, I'm primarily focused on my children. They are everything that keeps my world spinning.