Boomerangst: Turning Dilemmas Into Discoveries – Thorny Financial Issues
Here, how to tackle thorny financial issues with your adult children.
Q. Our daughter is planning to get married next year to a wonderful young man who my wife and I like very much. They’re among the lucky ones in that they’re recent university graduates who both landed great new jobs. But they also have significant student debt ($28,000 each). Our concern is that our daughter is a saver and our future son-in-law is a spender. That worries us because he’s already talking about trying to buy a house. We don’t want to interfere but we know money is the number-one factor in divorces so we don’t want them getting off to a bad start. How can we broach the subject and what, if anything, should we suggest they do?’
“Everyone has different styles of managing money, but you need to find the commonalities and share them,” says Hannah. “For example, I suspect they both want a house at some point so the difference likely relates to timing issues.” He suggests you might also relieve some of the personal pressure on you by recommending the couple see a financial counsellor – someone impartial who isn’t selling anything.
And if Hannah could offer some advice to your daughter and her future husband directly, it would be to sit down together and set some small, short-term goals. For example, it might be to agree to pay off $10,000 of the student loans this year, or maybe open a Tax Free Savings Account and save $5,000 towards a future down payment on a house.
“The worst thing they can do is commit to a big debt when they haven’t made their mark yet,” warns Hannah, suggesting instead they first build up some savings and get a few years of solid work experience under their belts. And remember, having ‘the talk’ comes with benefits. “When you learn to communicate better about money it helps your overall relationship big time.”