Wealth is Good
Cash Flow Is Better

This article, written by Keith Whelan, was recently posted on Wise Bread’s personal finance site.

A recent Pew Research study* confirms what most of us already know:  A growing number of adult children are either delaying their departure from home or are moving back after a false start.

In all fairness to this generation of young adults, they just happened to enter adulthood during a deep, prolonged recession.  To make matters worse, this recession has also been accompanied by a fundamental restructuring of our economy; so unfortunately things don’t look much better for the generation that follows either.

That’s something the children can’t control.  But what can be controlled is how well prepared they are to deal with it.  And their success or failure on that score will impact not only their own financial future but also yours – for the longer your children remain financially dependent on you the more it can delay or even jeopardize your retirement.

So, what can you as a parent do to reduce the “boomerang” risk?

First, set expectations: Share the bigger goal

When raising our two boys we established and tried to achieve three broad goals.  We communicated these goals to them early and often.  The hope was that if they had a clear understanding of what was expected of them it would help to anchor them and give them focus.

We summarized our goals as “IRC”:

– Independent (learn to live independently)

– Responsible (take responsibility and be accountable for your actions)

– Caring (care for and respect others…and yourself)

An important part of achieving the first goal – of becoming Independent – meant learning how to manage their own finances.  For help with this we were fortunate to receive some well-timed advice… Read the full article at: http://www.wisebread.com/how-to-raise-your-kids-to-be-financially-independent

Keith Whelan is Cashflownavigator's founder and author of the "Wealth is Good, Cash Flow is Better" e-booklet. He is a graduate of Columbia University Business School, teaches at Rutgers University, and has over 30 years experience in the banking and financial services industry. Keith, his wife Cindy, and their two sons live in New Jersey.