5 Golden Tips for Lending Money to Your Adult Child that will help you understand the best ways financially help your child in the long run

When you are continually thinking about the huge price associated with having children, you need to know about the different kinds of costs that you might have to take care of. From the very first day, you have to ensure that you are taking the proper medicines to keep your baby fit and healthy.

Once your baby is born, you have to concentrate on childcare, the school of your baby, college expenses. All these costs are entirely reasonable, and as parents, it is your responsibility to take care of all these.

However, you need to understand that your kids are going to tap your bank accounts as soon as they start turning 21. According to www.businessinsider.com, 6 out of every 10 Americans who have one adult child are responsible for providing financial support to them.

Lending Money to Your Adult Child: 5 Golden Tips

When you have to lend a considerable amount of money to your kids, it is suggested that you control your emotions and expect that you are going to be paid back at one point in time. However, lending money anytime and every time can not only lead to financial burden but can also break the bond that you share with your children.

This fact is why you need to consider critical financial tips to understand how you can loan money to your adult children. So that you can not only take care of the economic strife but also ensure that your family drama will be kept at bay.

5 Golden Tips for Lending Money to Your Adult Child that will help you understand the best ways financially help your child in the long run

Lend money that you are not going to miss

You might see that lending only a few dollars can help your adult child to complete the down payment of the home he is purchasing. However, as already mentioned before, you need to control your emotions.

Before you reach for the checkbook, you have to ensure that the amounts that you are ready to give away, will not lead to any financial instability. Even so, most parents lend money to their adult children despite the adversity that they will have to face.

Before you give money to your adult child, you must ask yourself if it is going to make any difference to the lifestyle that you are leading. If your answer is yes, make sure that you are not parting with the money. If your answer is no, you should consider if you have saved up enough for your time after retirement.

And, if at all you are giving money to your child even after saving up enough for yourself, make sure that you consider getting it back. Doing this is going to contribute towards making them responsible.

Remain clear as to how the child is going to make use of the funds

Most of the time, adult children take money from their parents by mentioning that they have to buy essential books or cash is required at their college. You might give the money to them but all of a sudden you can notice brand new furniture as well as electronics. This situation isn’t a coincidence. Your money purchased these products.

Whenever your child wants money from you, the first thing that you need to understand is whether he is responsible enough to use the funds judiciously. Also, please sit down and have a talk with him and try to understand precisely why he is asking for money. If he is honest with you, you can lend money, but make sure that he is paying back small amounts as time progresses.

You have the option of refusing to give money as well in case you have financial issues.

5 Golden Tips for Lending Money to Your Adult Child that will help you understand the best ways financially help your child in the long run

Ensure that you are setting terms if your child returns the money late

There is a high chance that your adult child has the intention of paying you the money back, but you cannot deposit plans in your savings account. To ensure that your child is accountable, you should lay out different terms and conditions in case if he cannot pay the money back in a timely fashion.

You need to forget that you are a parent, and you have to treat this situation precisely as if you are the bank and you are giving a loan. Make sure that there are interest rates as well as late fees in case if there are late payments or defaults. You should behave as if you have given a real loan.

In case you see that your child is struggling to pay the loan amount back, you might consider being lenient. However, make sure that you study the situation your child is going through before giving in or becoming emotional. You can go through the website of libertylending.com to gain more information.

5 Golden Tips for Lending Money to Your Adult Child that will help you understand the best ways financially help your child in the long run

Present unified fronts

It isn’t a bad thing to loan money to your adult child. However, you have to measure several things before you decide to do so. The first and most important thing is to discuss with your spouse before you are lending money. You need to understand whether your spouse is ready to give money.

If they are, make sure that you both discuss the terms of the loan as well. Doing this will help in avoiding arguments and also helps in protecting your spouse in any unfortunate event, in case if you are not there for enforcing the agreement.

Get things in writing.

Make sure that you have written agreements with your child, as this will help you to avoid a situation where he might disagree with the verbal terms and conditions that you had set. Ensure that all the terms associated with the loan are laid out correctly to avoid any confusion.


It is evident that if your child is going through a financial crisis, they are going to turn to you for support. It is not wrong to support them but ensure that you are keeping the golden rules that are mentioned above on your mind so that you do not face any trouble in the future.

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