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Delayed retirement a new trend: Introduction
Parents never stop wanting to help their children but there is a growing trend which can compromise the retirement of some seniors. It seems that many adult children are still financially reliant on their parents and treating them like an ATM. This makes delayed retirement a new trend.
Parents are paying for their adult children’s rent, cars, cell phones and even vacations, with money they often have to borrow. “There are quite a lot of our members, indeed, who have taken out loans to help their children and grandchildren because they have a better credit rating,” says CARP Vice President of Advocacy Susan Eng.
Delayed retirement a new trend: Grown children have a message for parents
A report by CIBC demonstrates clearly how helping adult children financially can negatively impact retirement plans.
- 66% of parents are dipping into their nest eggs to support their adult children
- 47% of parents said they have had to cut into their personal savings to help their children
- 44% said they have had to limit travel or spending on themselves
- 25% of parents are giving their adult children $500 or more each month
- 71% helped their children by offering free room and board in the family home
- 47% helped with groceries and household expenses
- 35% helped with cell phone bills
- 20% have delayed retirement
- 14% have delayed selling or downsizing their home
Delayed retirement a new trend: Forget what the retirement savings calculator said!
Unfortunately, it seems that parents supporting adult children is becoming the new normal. But, how far should a parent go to financially support their adult children? Many are delaying retirement. Others are borrowing money and accumulating debt which will certainly compromise their retirement.
This is a problem that can’t be solved with a quick fix. As a first step we strongly recommend budgets for both the parents and the adult children. This may help to get the spending under control.
Delayed retirement a new trend: What can you do if you have too much debt?
For parents that now find themselves getting deeper and deeper in debt our best advice is to contact a professional trustee. The Ira Smith Team can help. We have a cumulative 50+ years of experience dealing with diverse issues and complex files and we deliver the highest quality of professional service. There is a way out of debt and back to financial peace of mind Starting Over, Starting Now. Give us a call today.
