What You Owe Your Kids

Posted by Donald J. Trump on 3/20/2008 at 10:39 AM
Posted in Personal Finance

It wasn’t that long ago that parents pushed their kids out of the nest and watched them live their lives on their own.

But today’s tough job market has changed everything. These days, nine out of ten parents give money to their grown kids for major expenses such as credit card balances, car insurance, and student loans. Plus, there’s been a huge increase in the number of adult children who move back in with their parents when the real world gets too tough.

Have today’s parents raised a generation of spoiled young people who don’t know how to live within their means? Or is today’s world just too hard to navigate without help?

Whatever the answer, if you have kids, it’s great to help them financially if you can, but you have to look out for yourself too. When retirement comes along, there’s no doubt you could use the money you’re giving to your children today.

Besides that, how much are you helping your adult children by keeping them dependent on you? If they know they can always come to you for a handout, they’ll never learn to deal with financial setbacks or money management.

So, here’s my advice. If they desperately must have the money for a legitimate need - and you can afford to help - then give them a loan. If you want to make sure they learn financial responsibility, then make sure there are strings attached and know you expect them to stand on their feet eventually.

Remember, you brought your kids into this world. It’s only fair you help them navigate it.

Donald J. Trump is Chairman of Trump University.