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Retirement Mistakes – Adult Children: Closing the Bank of Mom & Dad

Last update on: Apr 20 2021

Many people enter retirement with sufficient assets, but they run out of money during retirement. A major cause of the shortfall is providing too much help to the children and grandchildren, becoming the Bank of Mom & Dad. This article discusses the problem and gives some ways to avoid falling into this trap.

Two-thirds of 50+ parents have financially supported a child 21 or older over the past five years, according to research from Merrill Lynch and Age Wave. The average amount provided in a one-year period: $6,800. If instead you saved that much cash every year in a tax-deferred account averaging 6% annual gains, you’d have close to $100,000 more for retirement within a decade.

I could certainly use an extra 100 grand by the time I retire. How about you?

What bothers me most, though, is the niggling concern that I might be crossing the line between helping my kids and hobbling them on the path to full-fledged adulthood.



May 2021:
Congress Comes for your Retirement Money
A devastating new law has just been enacted, with serious consequences for anyone holding an IRA, pension, or 401(k). Fortunately, there are still steps you can take to sidestep Congress, starting with this ONE SIMPLE MOVE.

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