Parenting/Budget Advice needed

[nolatravelgirl]

I think most are thinking of this as way too binary. It isn’t all or nothing. She can move into a reasonably priced apartment (maybe with a roommate to save on expenses) AND start to save for future bigger purchases in life. I think it is good that she wants to venture out on her own but if she has had no training on budgeting then she will likely fail. My question is why haven’t you been having money discussions all along for the last 15 years? Even though she had an easy road with no student loan debt, you should have been having a family meeting each semester to discuss the finances around going to school each semester. Growing up my parents would sometimes sit us down and look at things like the electric, water and gas bill. We were also sometimes put in charge at the grocery to keep a running total of the amount spent and had to make sure we were in alignment to the family budget. If she has no idea about how much basic life expenses cost then that is major parenting fail. Even when there is plenty of money flowing there is no excuse to not understanding basic budgeting and life skills.

 

[VictoriaT]

OP here... thanks for everyone's responses, interesting to see! DD understands budgets, we did teach her and her DB's about money growing up, she even took a financial responsibility class in high school. Knowing about and doing are two different things, however. Between my post and this past Sunday, not sure what happened, but DD had a big conversation with her dad, apologized for acting the way she was, and did some work on her budget. She is going to be paying us rent (that we will set aside for her when the time comes that she needs it) starting with her next paycheck this Friday. Believe me, I want her on her own, having fun being an independent 20-something; mom needs her freedom too!

 

[danceintherain]

I honestly can't think of a mistake a young adult can make after they move out that they can't also make while they're living at home. Drugs, debt, bad relationships etc are just as readily available to people who live at home as they are to people who live on their own.
Paying her own living expenses isn't absolutely going to prohibit her from creating a budget or saving for a down payment or putting money into retirement. It might limit her somewhat, but it's not going to ruin her life.

Yes, I know that math points to certain choices having a better outlook, but this young lady is underwriting mortgages right now. She gets a lovely view into the financial solvency of others, including what people have done to screw themselves over.

Overall, she has to want good things for herself, and living at home could actually be hindering her from achieving them, because her brain may be hardwired to still disagree with things simply because her parents are suggesting it.

I say this as someone whose parents are contemplating paying for a huge addition on her baby sister's house, because "she would really like to have a garage and a second bathroom." There's tons of backstory there, but I cannot stop shaking my head over this.

 

[afan]

My question is why haven’t you been having money discussions all along for the last 15 years

OP answered this, but a lot of parents don't have these discussions. If their parents didn't talk about it with them they may not think it should be. It was never discussed with me, I had to learn on my own. I still have no idea how much any of my three parents made when they were working or what they paid for a lot of stuff. With it just my mom now I'm aware of how much she gets each month for retirement and how much she's got saved etc. But this was all discussion after my stepdad passed and she was figuring everything out.

 

[MrsPete]

I think one thing that parents don't often consider is how making their children's lives easier can actually hinder them. We tend to see it as a positive if we are able to afford to provide nice things for our children, but they often come to view those things as basic life essentials instead of things they have to work/struggle/earn. For example, they may see vacations as something everyone just receives rather than something reserved for those who earn a certain income or budget for over a long period of time.

This is one of the themes of a book that used to be pretty popular: The Millionaire Next Door.

Personally, my husband and I decided long ago that we'd give our children less than we could afford. We've never been sorry.

I honestly can't think of a mistake a young adult can make after they move out that they can't also make while they're living at home. Drugs, debt, bad relationships etc are just as readily available to people who live at home as they are to people who live on their own.

Agree somewhat ... yes, all these mistakes can be made in your parents' house or in an apartment of your own, BUT at home your parents are watching, and they may see the beginnings of problems. I'd think parents would be faster to intervene than would roommates.

Yes, I know that math points to certain choices having a better outlook, but this young lady is underwriting mortgages right now. She gets a lovely view into the financial solvency of others, including what people have done to screw themselves over.

Thing is, she may or may not generalize this to her own life /may or may not take action based upon these insights. My father was a CPA and a literal mathematical genius -- clearly he understood compound interest, the value of saving from a young age -- but he was super-lousy with his own money and budgeting. Died broke. Knowledge is one thing; motivation is another.

OP answered this, but a lot of parents don't have these discussions. If their parents didn't talk about it with them they may not think it should be. It was never discussed with me, I had to learn on my own.

My mother helped me start a checking account as a high school senior. That's really the only financial lesson I took away from my home. I learned a good bit at school, of course. In college I realized it was possible NOT to grow up in a hand-to-mouth existence like my childhood family, and I started reading everything I could find in the college library: budgeting, frugal choices, investing, real estate. I was still living the college student version of hand-to-mouth, but I learned and when I started working, I was ready to make better financial choices than my family.

Some people teach you directly. Others teach by example -- and examples can be good or bad.

 

[brockash]

I am at my wits end with this , so I thought I would throw this out to all of you, and see what worked for you.

Warning- sorry for the long post ahead here! Oldest child, DD graduated college May 2020. She worked very hard and earned two degrees, one in marine biology and one in conservation biology. Needless to say, the job market in normal times for these is not great, and with the pandemic, there was nothing. Finally, after months of sending out resumes in her chosen fields with no response, she got a job as a mortgage underwriter. She has done very well, and is earning much more than she would be in her dream career path. She has been living with us since the stay at home order started for our state. Since she got this job, I have been hounding her to set up a budget plan, and stick with it. She was blessed to have no college debt thanks to grandparents and mom and dad, so she has never had to struggle, so she has been able to basically spend what she wanted without having to be an "adult". Yes, I know she is spoiled, but she is a very hard worker and good kid overall. She has been avoiding the budget talk for a few months now, and gets angry whenever I bring it up. I have suggested why not try and send out resumes again in her dream fields, since jobs are more available now, but she has been bitten by the money bug. She has now decided to get an apartment, to be on her own, instead of living with mom and dad and saving up her money, on a budget in the event that she eventually would get married or buy a house, or have money for grad school, if she chose to go that route, and would have a nice pot of cash to do so. DH lived at home after graduating, was able to save up and we had a nice down payment when we were getting married and house hunting, so he is angry about her decision. I am just worried that she will blow all her money, something will happen and need us to bail her out, which I do not want to do. Should I just let her do it, and learn the hard way if it comes to that? I am tired of all of us arguing about this. Thanks for any and all advice!

Yes, you've gotta let her go and on the other hand be grateful she has the motivation to not want to mooch off others (ie her parents) for the rest of her life. Not saying she won't be back, but she's an adult...let her go be an adult.

 

[Tiberella626]

I would have suggested once she graduated to not allow her to live rent free in your home. Even if you take the "rent" she is paying and put it in an investment or savings account for her benefit that's fine. I personally would pick a ROTH IRA for my kids.

You want her to build a budget for what exactly? To save money? That's not really a budget it's just save your money. You are not wrong but not too many 20ish year olds would listen to that period. With the apartment it will give her the opportunity to live, grow and budget. When my cousin lived at home she would throw a fit if her mom bought the store brand yogurt but once she moved out and had to make the call at the grocery store herself store brand it is!

Consider getting her set up with a financial advisor. An independent 3rd party can be the non parent voice that is needed sometimes. Parents never understand you know.

 

[Donald13]

I think the problem is you are comparing what your husband did to now… times are very different. Just because it worked for him, doesn’t mean it will work for her. And stop “hounding” her. She won’t talk to you at all if you keep that up

 

[needvaca]

sounds like she is progressing. good for you charging her rent- it's a good first step to bill management.
she has to learn the hardway. she has to move out and start paying bills (rent, electric, gas, cable, insurance) for the first time for it to really sink in. Then maybe you can help her budget, when it's more tangible to her.

Get her to contribute/max out her 401k. That is probably the single best financial move she can make at her age (since she has no school loans).

She actually sounds like she's in good shape- which is much easier for an outsider to see than a parent sometimes.

 

[VictoriaT]

She is paying us rent, putting 20% of her salary into her 401k (trying to get her to contribute more since her expenses are low, but that is a good start), and saving some of her income. Things are better here. She looked into apartments, and right now with the tight housing market, there is almost nothing available in there area she wants to live in her price range she can reasonably afford, so she is here with us for now, until more apartments open up. She is fine with that.

 

[Tattylou]

Let her go. She’s an adult. She can afford it. I moved out three months after finishing grad school. I could’ve stayed home and saved, but I was ready to live on my own. It all worked out too - eventually I still saved and bought a house.

 

[Princess Disney Mom]

She is old enough, she will be fine. It's tough letting them go , I know.

 

[first*toright]

Late to the party, but its an interesting discussion. My 18 year old is moving out in a couple of weeks - she is at a community college (tuition free), so living in a dorm isn't an option. She has found herself a room in a house to rent. It seems like a good intermediate step, where she is responsible for paying rent and buying groceries and stuff, but all utilities are included so there is only one big bill a month.

She has been working for 2 years and saving up to buy a car and move out, so now she's buying one of our old cars and has put down on a deposit on the room. Yes, it would be cheaper for her to stay here, but she really wants to be out on her own, and I'm happy to see her assert her independence and take responsibility.

I use YNAB for budgeting, and I made her start using it as soon as she said she was planning to move out. I think it is a great framework for keeping your finances straight. I don't do the budget for her, and only offer advice when asked, but I did insist she start a formal process so that she could see where her money went and make sure she has a plan to cover her expenses.

 

[jimmymc]

I'll comment as a 27 year old who went to college out of state and moved out for good less than a month after graduating.

Some kids just cannot live with their parents after achieving financial independence. It doesn't mean they don't love you or that they are up to trouble. But living with your parents after graduating feels like you're not actually independent, and you're right back where you started before putting in all the work for school. If the money is really that good, then setting a strict budget is not the most important thing in life. She will figure out the right balance of saving vs having fun when you're young.

 

[VictoriaT]

DD found a new apartment and is moving there Saturday. It is in a better location and is more reasonable than her first choice, and includes parking, which her original place did not include. Knowing DD, we will see more of her when she moves out than now, as our dog is the love of her life . At least we will finally be able to be empty nesters in a month when DS1 and DS2 move to school.

 

[easyas123]

DD found a new apartment and is moving there Saturday. It is in a better location and is more reasonable than her first choice, and includes parking, which her original place did not include. Knowing DD, we will see more of her when she moves out than now, as our dog is the love of her life . At least we will finally be able to be empty nesters in a month when DS1 and DS2 move to school.

Good luck to her!

We are empty nesters...it's FABULOUS!

 

[pweyl36]

My kids know we will always have their backs; I guess it's just an issue of not wanting them to make the same mistakes we did.

How will she ever learn if you always bail her out.

 

[VictoriaT]

How will she ever learn if you always bail her out.

I have not "bailed" her out of anything; when she has screwed up, she took responsibility. That's not what I meant by always having their backs.