When do you cut the financial cord? (long)

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<p>Background:</p>

<p>DH lost his job last year, and we took about a $30k pay cut, relocated halfway across the country, and are renting an apartment here and renting our house in Chicago for a loss.</p>

<p>We have 4 kids, 2 mine, and 2 his. Every month we struggle to pay our bills, and the money that we are spending on the kids has become a burden. I feel like we need to talk to the kids and ask them to take on more of the responsibility, but I can't decide what is fair and what is not fair. </p>

<p>Here is the scenario for each kid:</p>

<p>DD - 23 years old. Graduated a year ago, and spent a year teaching school. Now in Japan for a year teaching english. Wants to come back and go to law school. For her, we are paying off two parent loans, one $65 a month and the other $93 a month. I am paying off her car, $205 a month and her car insurance $50 a month. Her Direct loan is coming due in August for $187 a month.</p>

<p>DSS- 23 years old. A junior in college with 2 more years to go because he failed and dropped classes. No job. We pay a Parent Plus loan of $300, a car loan of $200, about $100 in car insurance, and for the summer we are paying his rent since he has no job.</p>

<p>DD- 20. Junior in college- college covered by merit scholarships/grants. Did the Disney internship and paid her own rent for a year. Rarely asks for money. I pay her car loan- $178, and her car insurance, about $70 a month.</p>

<p>DSD- 18 years old. Just graduated high school. Will be going to community college. No job, doesn't seem to be aggressively looking. We will be paying $150 in rent to her mom, and her car insurance. Driving DDs car while she is in Japan. DH wants to give her $400 a month to cover the rent, insurance and walking around money.</p>

<p>So do we tell all of them its time to start paying their own car payments and insurance, or do we look at each child as individuals and decide who deserves our help more? </p>

<p>This situation is complicated by the fact that this a 2nd marriage, and my kids rightfully think we have done more for my stepkids, and that my stepson is particular is being rewarded for being unsuccessful. </p>

<p>Any thoughts? Thanks in advance.</p>

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<p>You asked…</p>

<p>Cut the 23 year olds loose. They had their shot, even the one still in college who, good for him, is getting it together. Quit paying their car loans, insurance etc. It’s enough that you are paying their parent loans.</p>

<p>Give your 20 year old a big hug. Aren’t low mainentance children lovely??!! Still, can she help with her car insurance? $70 shouldn’t be difficult to come up with.</p>

<p>Concentrate on your new high school grad on the condition she actively searches for work. Does she have a plan or is she just ‘finding herself’?</p>

<p>Bottom line - if you decide to help one more than another do it by age. Help the younger ones more.
JMHO.</p>

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<p>They are all adults- I would help the youngest more than the oldest but your financial situation has changed for the worse and I wouldn’t pay for anyones car or car ins- that I would stop immediately.</p>

<p>Neither of my kids- 28 & 20, have ever had a car- because of our/their finances and need, and I know that they would not even accept us paying that for them, even if we were rolling in it.</p>

<p>No shame in living within your means.</p>

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<p>Agreed on all the cars & car insurance. That is a luxury.</p>

<p>And I personally would stop paying the rent for the summer for any of them. They can live where you live or cover the cost themselves. Although not sure if you have room in your current situation. But 23 year olds ought to be on their own, except the parent loans if you have agreed to cover them.</p>

<p>Of course, the difficulty is in working out an agreement with your spouse…</p>

<p>But I do think in this case you will save some headaches if you make a blanket rule that you don’t pay ANYONE’S car or insurance payment. I wouldn’t pick and choose if it were me, it just wouldn’t be worth the headaches.</p>

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<p>If you feel the need to make it “fair” you could cut off the older kids and pay the DSD’s & Dds car costs until they hit age 23.</p>

<p>We paid auto insurance for our kids as long as they were in university and successfully taking classes, once the graduated they were given that older used car so there were no car payments yet there was help with transportation. I am not sure how I would have handled it if one was years off track. Perhaps the fairness in that case is based on the age</p>

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<p>“Agreed on all the cars & car insurance. That is a luxury. And I personally would stop paying the rent for the summer for any of them. They can live where you live or cover the cost themselves.”</p>

<p>Agree with all of this. My parents were extremely generous, but never paid our summer rent. If we wanted to live for free, we could come home.</p>

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<p>I would try to keep it fair and you have a history of having paid for cars/insurance. </p>

<p>Our family rule is that we do not buy cars, pay for cars, or pay for auto insurance after the fall of freshman year begins (we paid it senior year of high school only, and they drove our cars). The exception would be if someone needed the car to COMMUTE to college if there was no public transit available. We also do not pay for summer rent, but we would IF the total 12 mos. were equal to the school year in the dorm (assuming that they are full time students getting UG degrees). Once they have college degrees, they can live at home, but we would not pay for rent or cars. </p>

<p>If you think it is fair to cut the auto payments, I would do so gradually. For example, I would warn them and tell them that in 60 days they will need to pay for some fair amount (ie: 1/2 of the costs) and 4 mos. later they must make full payments. I would only set the amount to what they could handle.</p>

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<p>Agree with all above…The 23 year olds should/could be cut loose. Pay your parent plus loans and give fair warnin to the kids that they are responsible for their vehicles and any loans they take on in addition to their living expenses. They are 23. It’s OK LOL. Personally I’d continue to support the 20 year old, but do continue to talk about when the parent bank starts closing. We told our kids by the end of the summer of the year they turned 21 or graduated from college the bank was closed. $250 is generous for an 18 year old ($400 - whatever your H owes his ex per month) but should cover gas to and from the CC and walking around money. The 18 year old can also take a 10-15 hour part time job and supplement the allowance.</p>

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<p>I’m with Emeraldkity - no cars/no car insurance. I might buy them a bike…</p>

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<p>First, what does your DH think? Do you comingle funds? Should you be? </p>

<p>I think others advice is good about the cars for the older two. I think the 23 year old that is still in school needs to be working and schooling at the same time, if he isn’t. I would have a time limit put on how much longer you all are helping him out. Next summer, he comes home or gets a job. No paying rent. </p>

<p>I think you need to have a long talk with your DD who wants to go to law school. It sounds like she will need loans to do so. The market for new lawyers is very soft, no telling if when/if it will improve. Perhaps she needs to work for a few years to save up a nest egg.</p>

<p>I think you need to clearly spell out expectations to the youngest – we will do X for Y years and then we are done.</p>

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<p>strange double post an hour later!</p>

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<p>DD - 23 years old. Keep paying the Parent school loans. I wouldn’t change the rules midstream. Make sure she understands she alone will be paying for law school. How much longer are the car payments?</p>

<p>DSS- 23 years old. Definitely the biggest problem here. Why doesn’t he have a job? I would not continue to take on anymore Parent Plus loans. Is this from current classes or from past schooling? If past, I’d honor the commitment, but, again, not take on anymore. I absolutely would not continue to pay on a car/insurance/rent for a kid with so little skin in the game.</p>

<p>DD- 20. Junior in college- Not sure what the Disney internship is, but she sounds self-sufficient. Bless her. I’d continue to pay her car loan- $178, and her car insurance, about $70 a month.</p>

<p>DSD- 18 years old. Not sure what the legalities are regarding continued support in the case of divorce.</p>

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<p>You are paying close to $1000/mon on car loans and insurance. Again, why does everyone need a car. As adults, if the need a car, they should pay for it. I don´t understand why the 23 year old son doesn´t have a job. He will be a life time student the rate he is going. He could manage a part time job and be a full time student. Better still, a full time job and a part time student.</p>

<p>I have a young woman working for me now, who started working at my bank at the age of 17. She got up 5 am to get to work by 7. She worked from 7 to 6pm, then went to school from 7 to 11pm. She did all of her homework on weekends. She told me last night that her father didn´t want her to work full time, but she is very glad she did because when she graduated she already had a job.</p>

<p>This is harsh, but you are an enabler by paying for so much of your kids´expenses. I would give each of them 3 to 6 months notice on what you are willing to pay and then pull the plugs. I do agree with other posters that your younger 2 kids are the ones you need to focus on. But I would also ask them to get a job. My older daughter didn´t need a job because we gave her an allowance, but our deal with her was she had to work min 10 hours per week in order to be eligible for her allowance.</p>

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<p>Wow so many car payments. Whatever happened to buy a car with cash even if it was a clunker? I personally would cut off the car payments. My kids always drove clunkers they paid for themselves, even in high school. My siblings and I did the same so I guess it’s a family tradition…</p>

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<p>My kids, at 27 and 24, have neither ever owned a car. ( Well, D does now share the expenses of her BF’s 82 Ford, which barely runs… ); they are masters of public transportation. If they want cars/insurance, it’s on them. We also don’t pay rent, never have. They are welcome to live at home if finances become dicey or to save money for future plans. S half lives with us, and pays us rent.</p>

<p>If something important comes up, we will always help out. We did pay for college and we did cover those loans. But we cannot take on cars or rent.</p>

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<p>I am in agreement with other posters regarding the car loans and car insurance. Questions (1)– what kind of car does DSS have that requires $1200/yr in car insurance? (2) Is your ex able to help financially? If not DD-23 should consider postponing law school for a few years, while she saves money and pays off some of her undergrad debt.

Isn’t she driving DD-23’s car? Aren’t you already paying the car insurance on this car? Aren’t you already paying her mom $150/month for rent?</p>

<p>It sounds like your H is still functioning as if your financial situation hasn’t drastically changed.</p>

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<p>It’s a challenge, especially in this economy. </p>

<p>Our kids understand that we pay for college but then expect them to be on their own, although they are welcome to start out living with us. We did cover D’s medical insurance for a few months until she got her first job after college. She then worked for three years and lived at home rent free to save for grad school. (Because she was saving for grad school we did not want to charge her rent.) We sold her (at book value) our old car, which she needed to get to work. She made monthly car payments to us and paid it off in just over a year. </p>

<p>She is now in grad school, fully funded, but her assistantship salary does not cover her living costs. She draws on her savings and some modest student loans for that. We did offer to cover her dental costs, as she does not get dental insurance with her grad program and we did not want her skimping on dental visits. </p>

<p>Our second is only half way through college, and we pay his tuition & R & B costs over his Stafford loans. He works a summer job and uses that income for his spending money. </p>

<p>One concern I have is with your DD who is considering law school. Does she have a plan for paying for that? It can be really expensive to go to full-time law school and loans can be overwhelming and a heavy burden for a young person, compromising her future options. You may want to make sure she has no expectation of being bailed out by you for her law school costs. I see that others have expressed concern about this as well. Encourage her to have a practical plan. </p>

<p>I agree with those who consider a car a luxury, unless it is **needed **to get to school or work. Those who can manage without a car are both smart and fortunate. </p>

<p>Best wishes for this challenge. If you present it properly to the kids (“We have a problem and need to address it together”) there should be no resentment.</p>

<p>I say the best monetary gift I can give my kids is that they not have to worry about helping their parents out financially down the road. Tell your kids you want to spare them that! ;)</p>

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<p>

Agree!!</p>

<p>I just want to clarify………….I have no problem with parents financially helping their adult children, when they can afford to do so. If money is not an issue give as much as you want. It is your money.</p>

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<p>Yes. (10 char)</p>

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<p>I’m also wondering why all of your/spouse’s children need cars. Many college students get along just fine without cars. It seems that daughter who is in Japan should be paying her own car payment, insurance and upcoming direct loan on her own. This is the second year she’s been out of school. She is employed. Why isn’t she covering these expenses?</p>

<p>The S who is 23 and a junior and has no job- Does he really need car and why isn’t he assisting with any of the expenses? It seems that (at least at some point) he does not take school all that seriously. I’d be reluctant to fund that.</p>

<p>It sounds like a few years ago you could afford to help all the kids, but now you cannot due to pay cuts, a cross country move and increased expenses due to your home expenses in Chicago and your current apartment. The kids are old enough to understand this. Assist them only to the extent that you can, even if that means they get nothing.</p>