Gradual release

[tvguy]

And? They have been approved. They exist, right now.

But they are in my experience flat fees, not a percentage.

 

[Skippy918]

My kids are not college age yet, but after I graduated, I lived at home for a few months and then got an apartment once I started working to be close to work. I had a roommate at the time. My parents had helped with my car down payment and I paid the loan payment. Once I moved out, I was paying for everything on my own. I got married a year and a half after finishing school. My dh was on his own financially when he started college. His parents didn't help him at all. My parents still send us monetary gifts and my mom will buy the airline tickets for us to visit even though we can afford it.

 

[monsterkitty]

I started teaching in 1988 and my take home pay was $750/month. I lived at home the first year and paid my mom $100/rent.

I had less than $6,000 is student loans, but when I graduated, the company I had them with broke up the loans and sold them to several companies. That meant I had to pay the base amount each month to 5 companies for a total of $450/month.

My second year my take home pay was $800/month. I did move out of my mom's house and rented a 1-bedroom apartment for $425.

I did have a second job at a local waterpark that began in February for hiring and training but ended on Labor Day. I used this money to pay off my student loans that first summer. As I was in management at the waterpark, I actually made more money there per month than I did teaching, even after I got my Masters in Ed.

When I moved out, my mom gave me the money I had paid her in rent to help get me started.

Fast-forward to the 2020/21 school year - My youngest niece began her first year of teaching. She is probably going to be living at home for a few more years before she can even afford a studio apartment.

 

[leebee]

DD lived at home for a year after graduation. She worked as a paraprofessional in education which means she earned minimum wage for a nine month position. We did not charge her rent and she commuted to work with me. When her boyfriend graduated they moved to a different state so he could pursue a career as an engineer. She paid all her own everything, except we kept her on our health insurance until she turned 26. When that relationship broke up she moved back to our area but in her own apartment, with her own health insurance, car insurance and payments, etc. We paid for her medical co-pays as an income of $27K doesn't go very far. We have always paid her school loans as we didn't have a college fund for her. Fortunately she borrowed very little, comparatively, and the monthly payments are ~$300. DD returned to grad school last fall and got married about a month later. She moved into the apartment where DSIL and his 5yo (now 6yo) son were living. When their rent went to $1400 a month this spring, they moved in with us (my mortgage is less than that!). We have a big house, so they have their own living room, 2 bedrooms, and bathroom, and we share the kitchen and dining room. So far, so good. They don't pay rent but kick in their share of car insurance, phone bill, and a set amount towards utilities, and they pay for most of the streaming services, which they had and we didn't, and we pay for Sling (which is all we had). Food... hard to say. We do a lot of grocery shopping together and I pay for a majority of it, but they also pay for a lot of stuff that they choose to eat that we wouldn't. It works out. Hopefully they are saving some money towards a down payment on a house in the future, but I know that SIL's payment plans on legal and medical debt take a chunk of his take-home pay. It won't be forever though. They pay for all of their own (and The Boy's) clothing costs, health insurance, social life (which is minimal), and we all put gas in the cars. The rule is if there isn't enough gas to get the next guy to work in the morning, put SOMETHING in the tank!

I'm glad we can help them out. Once I graduated from high school I was totally on my own, and it was hard. While I know it's because my mom couldn't afford to support me, it was still hard and I don't want DD to have to experience that if it's avoidable- and right now, it is. We can't help with the medical/legal debt, but we can help keep a roof over their heads and food in their bellies, so we will.

 

[indimom]

I have a follow-up question, for those of you who are helping your adult children out--do you have an exit strategy? A date certain or possibly a salary or education goal, at which point you'll pull back from the support? I'm not asking to be snarky, I'm just curious. I can understand helping with some things, like health insurance or a cell phone, maybe car insurance. But at some point, the bird's gotta fly, right? They're going to need to figure out how to live within their means, even if they aren't in their dream job. What happens when they get married? Have a child? Do you continue to throw support their way, because housing is expensive, child care is expensive, cars are expensive... On a side note, will they be expected to help YOU if you can't afford retirement, or get a debilitating disease?

P.S. I'm talking about neurotypical adult children here--some of us have special needs adults, which changes the calculus. Some may never fly solo, but the goal is to get them as close as reasonable (for them).

Honestly, no exit strategy for us. Maybe we should; but, we are flying by the seat of our pants on this one.
I really don't worry too much; because, our kids don't ask for or expect help and they are always appreciative when it is offered. Our kids live simple lives, they aren't out buying lux clothes/makeup, partying every weekend (or at all, ha ha), or blowing their income on toys or eating out every day while mom and dad help out with basic bills. I would probably feel differently if they were.
Our kids were not raised in the lap of luxury. My husband and I have decent incomes now as a nurse and postal worker; but, when the kids were young, I was a home day care provider and my husband was slaving away in a local factory. The kids didn't get a lot of extras so they understand about hard work, savings, delayed gratification, and living on a budget.
If I felt like they were starting to take advantage of us or risking our retirement, etc., we would stop offering assistance and let them figure it out/take the hit/pay the piper. Until then, I'm ok with helping them out when I can.

 

[Travel60]

We helped substantially through grad school (one is PhD and one a doctor). They both had partial scholarships or paid research jobs but we covered what they couldn't. Helped them get set up after graduation and still give generous gifts but no direct bills. But, if they are traveling to visit us or for a family vacation, that's on us. As mentioned, with estate taxes being what they are (or may be), we figure let them enjoy it now so we can see them enjoying rather than wait til we die and the government get half.

 

[bjscheel]

Exit strategy: Per my prior post, paying for car expenses stops approx. 5 months after college graduation. We'll take them off health insurance at the earlier of age 26, getting a job with benefits, or married. Cell phone, probably when they get married (assuming they will in the next few years).

 

[BroadwayHermione5]

Oh also don't forget with health insurance some carriers stop vision and dental once they are out of school. HOWEVER if they are in school they can be put back on. I lost vision and dental at 22 (though my eye doctor goes through medical so i didn't visit the dentist for a while until I got my own insurance) BUT if I were to ever go for masters or doctorate I can be added back onto my parents vision and dental.

And if you are someone who has questions about health insurance at 26 (especially if for some reason the full time job you get doesn't offer them) do not be afraid to go to your local health clinic. The purposes of local health clinics are to help people with getting insurance and figuring out the cobra system. Same goes for anyone needing disability or anyone preparing to retire and needing to go on medicare.

 

[GAN]

I have two adult daughters and still help them out. DD28 is a teacher with Masters, and DD24 is a Communications/Marketing person for a high-tech company in Boston -so they both do fairly well, but like others the teacher struggles a little more. My oldest graduated college and broke out on her own right away(1000 miles from home) and hard a fairly hard time financially. She came back and I've been working with her the last couple years and she's done really well. I have her as a "participant" on my Apple Card, so she can build her own credit but I can still keep an eye on her balance. At this point, neither "need" any money from me but I still buy them groceries every so often and other things -what's the difference, I'm not struggling and it's all going to be theirs anyway!

 

[disneychrista]

I just have to say I am amazed at the number of posters who help their adult children out financially. Not just the keeping on the family cell phone and insurance but actually giving money to help pay expenses.

Like I said previously I couldn’t afford to do that. Not sure what I would do if I could. I mean it would be nice to experience the empty nest.

 

[BroadwayHermione5]

I just have to say I am amazed at the number of posters who help their adult children out financially. Not just the keeping on the family cell phone and insurance but actually giving money to help pay expenses.

I think this is a sign of the times. I saw it too in my older family members when the 2008 recession hit.

That being said, I also don't expect much either and have often told my parents if I ever get married, most if not all ( I know they'd want to pay for my dress) of the contributions for the wedding would go towards the down payment on a house. I would rather have a simple laid back wedding then a big one (most of my friends are also like this), and be able to start fresh with a new house.

 

[CdnCarrie]

I think this is a sign of the times. I saw it too in my older family members when the 2008 recession hit.

That being said, I also don't expect much either and have often told my parents if I ever get married, most if not all ( I know they'd want to pay for my dress) of the contributions for the wedding would go towards the down payment on a house. I would rather have a simple laid back wedding then a big one (most of my friends are also like this), and be able to start fresh with a new house.

My son has paid his cell phone bill since age 18 with a part time job. I don’t see this as a sign of the times at all.

 

[ford family]

There is another element to "gradual release" that may not be applicable to the US or Canada but is very important in the UK.
Inheritance tax of 40% is levied on estates over the current threshold of between £325,000 and £500,000 including the value of your home.

Avoiding this death duty can be achieved by giving away money or other assets which then cease to be part of your taxable estate if you live another seven years.

We initially helped our children through university and provided them with the deposits for their first homes. All three bought wisely and managed their own financial affairs themselves whilst always being able to turn to us for advice if needed.

But now we have to distribute assets in such a way that not only helps them but helps us all avoid the insatiable demands of the taxman. We have to "gradually release" our own wealth in a tax efficient manner without impinging on our own life style.

We have downsized twice in the last fifteen years, each time freeing up a good amount of capital. Each time we have given a large amount to our children on the understanding that they use it to reduce their mortgages. Now all in their thirties, our children are mortgage free and can enjoy their "inheritance" whilst we are still alive to see them doing so.

ford family

 

[luvsvacation]

I’ve always been a bit put off by adults who continue to take an allowance (monthly payments) from their parents. I’m also put off by parents who try to control their adult children. I figure I had 18 years to give them advice and ever increasing experience and now it’s time for them to take over control of their life, both choices and consequences.

DD is 20 and while we do pay the majority of her college costs she is responsible for everything else. She works and pays for her car payment, insurance, phone (she’s on our plan but pays is her portion each month), groceries (no dining plan, but her dorm room has a full kitchen), gas, personal expenses, clothes, fun money, etc. she also pays us 300 a month towards her schooling. That comes out to only 3,600 per year for school which I felt was fair. We pay all the rest of the tuition/fees/dorm. She’ll graduate debt free. She also pays for her extra activities like sorority and cheer team. She budgets very well. She has a checking and savings account and her own credit card that she pays off in full every month. She is blown away by other friends at school who are given everything and have no idea how to budget or plan. She’s also shocked by how many of the parents still try to tell their kids what they can and can’t do! Some that even force their kids into a particular major or career since it’s their money. Now while she’s home from school over the summer if I’m picking up take out for dinner I buy her some too and whenever we go out to eat together I pay. When we go on family trips I pay for the trip itself and she just pays for extras that she wants. I’m saving right now because when she graduates in 2 years we’re planning to do 4-5 weeeks in Europe just the 2 of us. I’ll be paying for that as her grad gift. She’s saving for her wardrobe for the trip I don’t mind at all helping out with something from time to time or just doing something unexpected. When I help her move back into the dorm in a couple of weeks I’ll surprise her with a 150 giftcard to the grocery store to help her get set up for the beginning of the year. But giving monthly allowances or paying for her expenses is a hard no for me.

 

[Poohlove]

Gradual release is a great phrase! In a sense I suppose I am doing something similar with my guys - DD22 & DS24. They have both worked since they were in high school and have always paid for their own gas and entertainment expenses. The deal I made with them was that post high school I would pay for their education once, and cover their car insurance and cell phone bill while they were in school full time. They could live at home rent free as long as they were being smart with their money and helped out around the house. My son has worked full time as an electrician since a few weeks after graduation, he attended the electrical apprentice program at a local college and now after working for a few years he is about to take his licensing exam. He began paying his insurance and cell phone shortly after graduating high school since he was making very good money and only attending school 2 nights a week. My daughter had her insurance and cell phone grace period extended due to the fact that she was making peanuts upon completing cosmetology school. She took over her car insurance and cell phone bill about 18 months ago since establishing her book.( They are both on my auto insurance policy because quoting them on their own policy was much more expensive for them.) My son has health insurance (among other excellent benefits) through his job as a union electrician, my daughter pays for her own health insurance through the marketplace.

My reason in doing this is that I do not want my guys to struggle when going out on their own like I did. They have been able to establish their credit and save up money to have a solid foundation for when they are ready to buy a house. As expensive as things are and as difficult as it is to find housing - let alone affordable housing in a safe area - their options would be limited anyway. They do not take our arrangement for granted and are grateful. If they were squandering their money or being irresponsible we would re-negotiate.

 

[GAN]

I’ve always been a bit put off by adults who continue to take an allowance (monthly payments) from their parents. I’m also put off by parents who try to control their adult children. I figure I had 18 years to give them advice and ever increasing experience and now it’s time for them to take over control of their life, both choices and consequences.

DD is 20 and while we do pay the majority of her college costs she is responsible for everything else. She works and pays for her car payment, insurance, phone (she’s on our plan but pays is her portion each month), groceries (no dining plan, but her dorm room has a full kitchen), gas, personal expenses, clothes, fun money, etc. she also pays us 300 a month towards her schooling. That comes out to only 3,600 per year for school which I felt was fair. We pay all the rest of the tuition/fees/dorm. She’ll graduate debt free. She also pays for her extra activities like sorority and cheer team. She budgets very well. She has a checking and savings account and her own credit card that she pays off in full every month. She is blown away by other friends at school who are given everything and have no idea how to budget or plan. She’s also shocked by how many of the parents still try to tell their kids what they can and can’t do! Some that even force their kids into a particular major or career since it’s their money. Now while she’s home from school over the summer if I’m picking up take out for dinner I buy her some too and whenever we go out to eat together I pay. When we go on family trips I pay for the trip itself and she just pays for extras that she wants. I’m saving right now because when she graduates in 2 years we’re planning to do 4-5 weeeks in Europe just the 2 of us. I’ll be paying for that as her grad gift. She’s saving for her wardrobe for the trip I don’t mind at all helping out with something from time to time or just doing something unexpected. When I help her move back into the dorm in a couple of weeks I’ll surprise her with a 150 giftcard to the grocery store to help her get set up for the beginning of the year. But giving monthly allowances or paying for her expenses is a hard no for me.

Every child(even if an adult) is different and requires different ways to get them off on their own. I have one that has always been financially responsible and paid most of her college tuition herself and just bought a $50k car on her own, while my other daughter still requires a little “guidance” …and I’m perfectly fine with that. Better that than having them tell me they owe $50k in credit card debt. In the end, I’m sure they’ll both be near the same level later in their lives.

 

[CaptainAmerica]

I'm closer to your kids' age than your own, so I'll answer for myself.

I graduated in May of 2011, got married in July of 2011, started my full-time job in August of 2011, and bought my first house in December 2011. My parents gave me zero dollars, but my wife came to the marriage with about $25,000 of unspent college fund money since she had earned scholarships and didn't end up needing it. I had about $30,000 of student loans and needed a car, which I bought myself.

I am now miles ahead of my peers. If you don't let your kids struggle, they'll never learn how to succeed.

 

[Mackenzie Click-Mickelson]

I’ve always been a bit put off by adults who continue to take an allowance (monthly payments) from their parents.

TBH I find this above statement at odds with the below statements (well the comment in general but pulled these ones out).

I figure I had 18 years to give them advice and ever increasing experience and now it’s time for them to take over control of their life, both choices and consequences.

DD is 20 and while we do pay the majority of her college costs she is responsible for everything else.

She’ll graduate debt free.

I understand that for you the line is an allowance monthly but how is that truly any different than the lion's share of someone's expenditures? By that I mean college and graduating debt free. While I think that's lovely that will happen I do find it virtually the same as giving someone monthly payments and far more than the below

I don’t mind at all helping out with something from time to time or just doing something unexpected.

I suppose in a nutshell while you gave them 18 years of advice and experience they chose to allow their parents to pay for their college education.

 

[mjkacmom]

I'm closer to your kids' age than your own, so I'll answer for myself.

I graduated in May of 2011, got married in July of 2011, started my full-time job in August of 2011, and bought my first house in December 2011. My parents gave me zero dollars, but my wife came to the marriage with about $25,000 of unspent college fund money since she had earned scholarships and didn't end up needing it. I had about $30,000 of student loans and needed a car, which I bought myself.

I am now miles ahead of my peers. If you don't let your kids struggle, they'll never learn how to succeed.

My sister’s ex had college and graduate school paid for by his wealthy parents (notre dame/university of Chicago). He ended up starting his own business, made a ton of money, decided to sell and retire at 45, but part of the sale was he needed to be an employee of the company he sold it to for a year (million dollar salary). My sister and her ex do not need to work ever again. There are many successful people who had it easy.

 

[mrs. magoo]

Our oldest never returned home when he graduated. He is still on my health insurance as we have a family plan but the kids are kicked off dental at 23 so he has his own dental insurance. He also has his own car insurance and car payment. Really the only thing he is still on is the cell phone plan but if he wants a new phone he needs to buy it himself. My daughter has just gotten her first teaching job in our school district. She is living at home. She is on my health insurance and our car insurance. She just bought her own phone but is still on our plan. My 2nd daughter is going to be a senior in college. She does not want to return to our city and wants to be on her own. She does have 10,000 saved to make this work and she is going to look for jobs in the Phoenix area since we have family there. The youngest is only a sophomore in college so yes we are on the gradual release program.