Monday, November 14, 2011

How to Give Help to Family without Neglecting Your Own Financial Needs

As the cost of a college education skyrockets, and the unemployment rate for new college graduates holds steady at a depressing 17 percent, more and more grandparents are feeling the pressure to help their college age grandchildren pay for college expenses, or help with student loans after graduation.

While college students (and their families) could certainly use the help, is lending financial assistance a good idea for grandparents? This article in the Wall Street Journal says maybe not. “Some grandparents are making financial mistakes that could put their own financial future in jeopardy. Promising too much to grandchildren, not saving enough for their own possible health-care needs and paying off their grandchildren's loans are some of the mistakes well-meaning grandparents are making”

For grandparents who would like to lend a helping  hand to their children and grandchildren, but are worried about neglecting their own financial futures, our office would like to suggest that there are a number of ways to help without shortchanging yourself. The WSJ article suggests that grandparents can “give support in other ways such as volunteering with their grandchild or encouraging them to pursue an education.”

Another option is to spend your money wisely during your lifetime and make arrangements with your estate planner to leave the remainder of your fortune where it will do the most good after your death. If your grandchildren are still young you may want to have their inheritance used to fund an education trust, or specify that it is to be used to pay off any existing student loans. If you have older grandchildren you can provide invaluable financial assistance by specifying that an inheritance should be used to pay for their children’s college education, giving them some breathing room during those lean financial years.

However you choose to be of assistance to your children, grandchildren, or even your great-grandchildren, our office can help you accomplish your goals. Call us today.