The Bank of Mum and Dad — When Should Parents Stop Financially Supporting Their Adult Children?

The following article is by Kim Potgieter, Certified Financial Planner, author and coach; who gives us some valuable insight into money management strategies that can help provide information for South Africans to achieve financial freedom:

More and more parents still pay for adult children long after growing up – covering rent, cars, debt, education fees, business bailouts, or even full living expenses. Some parents are now supporting not just one but multiple generations – adult children, grandchildren, and elderly parents.

What starts as a short-term safety net often becomes a long-term habit. And while the instinct to help is natural, the real cost builds up slowly over time: parents risk sacrificing their own financial wellbeing, delaying retirement, or even becoming financially dependent on the very children they’re trying to support.

At some point, every parent has to ask the difficult question: how much help is too much?

The real cost of ongoing financial support

I regularly sit with clients who financially support adult children well into retirement. When we work through the numbers together, many are shocked to realise that by continuing this support, they may eventually become financially dependent on those same children.

I have a client whose son started abusing heavy drugs. This completely took over the family’s lives for decades and came at a cost that ate into their savings. I have another client whose son-in-law started losing his sight, and they had to structure their plan so that they could support two whole households – their own and their daughter’s.

Every financial gift, every loan that is never repaid, every extra expense, can slowly chip away at your retirement savings. Sometimes, this means delaying retirement. Sometimes, it means scaling back your own lifestyle. In some cases, it means sacrificing personal dreams, travel, hobbies or even medical care simply to continue giving.

When helping becomes enabling

There’s a fine line between offering support and creating dependency. While temporary help may be appropriate in some situations, ongoing financial support can unintentionally prevent adult children from building the confidence and responsibility they need to manage their own finances.

As our adult children experience growing financial stress, the answer is not always as simple as stepping in to fix the problem. Sometimes, we need to pause and assess what is best for the family. Each situation is unique, and it is all about meaning and balance.

As parents, it helps to reflect on some difficult but necessary questions:

• Do we have the financial capacity to continue supporting others without compromising our own financial future?
• Are we unintentionally enabling our children instead of helping them build independence?
• Are there boundaries we need to set, even if they feel uncomfortable?

Conversations to have with your dependent adult children

It’s important to talk openly with your adult children about what support you can offer and what you cannot. These conversations aren’t only about financial boundaries but also about exploring how you can help them take greater responsibility for their own future. 

You might ask:

• How long do you anticipate needing financial support?
• What financial responsibilities can you start taking over?
• Are there ways we can work together to help you build your earning potential – for example, updating your CV, exploring new skills or further studies?
• Would you be open to working with a financial planner to create your own financial plan?

Clear expectations and honest conversations help everyone understand what is possible, what is sustainable, and where the boundaries need to be.

The financial wisdom we can pass on

Over the years, I’ve asked many clients what money lessons they wish they had learned earlier in life. The answers are surprisingly consistent. They wish someone had taught them:

• The power of compound interest and starting to save early.
• That money does not equal self-worth.
• That earning is about adding value.
• That living within your means brings far more freedom than chasing an unsustainable lifestyle.

More than anything, our children learn not only from what we say but also from what they see us do. We are their role models.

• Talk positively about work – it’s not a burden, but a way we add value and earn.
• Avoid tying self-worth to income, possessions, or material status.
• Be mindful of your self-talk about money. If you constantly feel or speak as though you never have enough, that belief will shape not only your reality but your children’s as well.
• Encourage an abundant, balanced view of money. When we approach money with confidence and gratitude, we pass that perspective on to our children, too.

Passing these lessons on to our children – even while we still support them – can help them build confidence. 

The role of financial planning

It’s easy to lose perspective when it comes to family and money. A financial planner plays a valuable role in helping you evaluate what ongoing support is affordable, how it may affect your retirement, and where healthy boundaries can be set.

A financial planner brings an independent voice to emotional conversations, keeping the focus on facts, not fear. While no one can make these decisions for you, having professional guidance can give you the clarity to balance love with long-term financial security.

There’s no simple formula for when to stop supporting adult children. Every family is different. But one truth remains: you cannot pour from an empty cup. Protecting your financial wellbeing allows you to enjoy your retirement, remain independent, and empower your children to build secure futures of their own. For more information, visit the Chartered Wealth website.