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How Can You Help Your Kids With Money, If…

You can’t help your kids with money if you don’t have enough to cover yourself


When my parents retired in the U.S. over 20 years ago, most of their contemporaries relied on a three-legged stool for income: personal savings, pensions, and Social Security. My mother and father had never worked in the States, so they were ineligible for most of those options. Yet they still enjoyed a comfortable retirement thanks to saving and investing well.

Grandparents Are Overspending on Their Kids, but Can They Afford It?

Today, that three-legged stool collapsed. Pensions – which provided lifetime income – have basically disappeared, and many don’t realize that Social Security only covers about 40% of what’s made while working. The bottom line? The burden of having enough retirement income has shifted to us.

“This is magnified by Peak 65, a historic demographic event in 2024 when the most significant number of Americans in history will turn 65.”

According to the 2023 Protected Retirement Income and Planning Study (PRIP), Americans need to prepare financially for retirement. 51% of Americans between 45 and 75 feel they don’t have enough savings to last their lifetime, and 32% aren’t confident they’ll be able to cover basic monthly expenses. This is magnified by Peak 65, a historic demographic event in 2024 when the most significant number of Americans in history will turn 65.

The cost of putting kids’ needs first

In a chat with Emily and Mike Morgan on Grand Life, we discussed how grandparents often forsake their financial security to help their adult children and grandchildren, with an annual cost of around 179 billion dollars. According to AARP, 53% of grandparents pay for education, 37% contribute to living expenses, and almost a quarter cover medical bills. Research by a 2023 Bankrate report reveals that 51% of parents sacrifice their emergency savings. However, the scariest finding is that parents just ten or fewer years away from retirement contribute the most to their children.

Tamara Ince, founder of Ince Counseling and Consulting, explains, “It’s a perfect storm. Many grandparents are in that legacy period where they want to feel more connected and charitable. They feel some responsibility for the generations that follow them but may not have set boundaries. And that’s why, in some cases, they aren’t always concerned with their survival.”

 Quick Tips to Help You and Your Kids

The good news is that there are ways to secure your retirement first and then help support loved ones:

  1. Work with a financial advisor to create an income vs. spending plan considering your essential and discretionary expenses.


  1. To fill the gap that Social Security leaves, ensure you have enough protected, guaranteed income, such as an annuity, to cover your basics.


  1. Be transparent about your retirement finances and limits with your children and grandchildren.


  1. Give money as a loan with a repayment plan and put parameters in place if you plan to support adult children financially.

The PRIP study finds that Americans and financial advisors are more focused today on having enough protected income to support what could be decades in retirement. Like my parents, protect your retirement income and be disciplined with your money to help prioritize where and what you can spend. To learn more, visit protectedincome.org.

Read more on money in GRAND here




Cyrus Bamji

About the author

Cyrus E. Bamji, chief strategy and communications officer with Alliance for Lifetime Income, has spent over 20 years leading large-scale growth and transformation strategies for financial services, healthcare, and technology organizations. He leads financial education strategies focused on consumers and financial advisors. Formed five years ago by leading financial service companies, ALI is dedicated to educating Americans about achieving financial security and living the second half of life.

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