• Home
  • Services
  • Testimonials
  • FAQ
  • Podcasts / Seminars
  • Blog
  • Contact Us
  • Investment Management
  • Retirement Planning
  • Financial Planning
  • #3076 (no title)
Labinsky Financial
Log In

LOG IN

LOG IN
Forgot Password?
FORGOT PASSWORD Cancel
ad top
  • +972-2-991-0029

    Red paragraph text

  • CLICK HERE TO CONTACT US
  • Labinsky Financial Financial planning and investment management tailored to your individual situation

    • Home
    • About Us
    • Services
    • Testimonials
    • FAQ
    • Podcasts / Seminars
    • Blog
    • Contact Us

  • +972-2-991-0029
  • CLICK HERE TO CONTACT US
  • Labinsky Financial
  • Stay Informed!

    Click Here To Sign Up For Our Newsletter

    • Investment Management
    • Retirement Planning
    • Financial Planning
    • Pre and Post Aliyah
    Financial Planning financial planning for your children Uncategorized

    Limited vs Limitless Generosity

    shaniecooperNovember 6, 2022349 Views0

    by Baruch Labinsky

    C S Lewis is quoted as saying “Children … are the most important work” – which means that parents take on the ultimate job with zero experience and zero training. It’s therefore not remotely surprising that rainforests have been destroyed to produce paper for the countless number of parenting books, in addition to the seminars, webinars, private and public forums,etc   – all with the goal of giving parents the tools to raise their kids in the correct manner.

    Parenting arouses contradictory attitudes and approaches, which is dependent on many factors, including culture, religion, economic standing, and psychological predisposition.  From an economic perspective, I have seen many parents who want to make their kids’ lives as easy as possible so they don’t suffer the same deprivations or hardships as their parents. However, simultaneously parents also want to encourage growth and independence. Unfortunately, the reality is that facilitating dependence while preaching independence makes for a very confusing mixed message.

    Independence

    From a very young age our kids look to us for boundaries and direction, and their habits and attitudes are formed as a result. If every time a parent goes shopping with their young child, they buy whatever is being demanded, the chances are that this child will grow into an ungrateful and entitled individual. And I’m sure that is not why the parent chose to indulge their child.

    The guidance our children need from us should change as they age.  Whereas virtually everyone will agree that it is appropriate to wake up a first-grade child so they aren’t late for school, the twelfth-grade child needs to have worked out for themself how to get to school on time, or face the consequences.

    Our children need that same direction and guidance when it comes to finances and especially when it comes to achieving financial independence. Creating long term financial dependency is a recipe for disaster in many cases.  Those parents who are able to help support their children as they become adults, need to understand the pitfalls of limitless generosity. (Even if there are limitless resources available financial dependency may create deep long-term insecurities, and is associated with a lack of drive, and long-term purpose on the part of the recipient.)

    Limited generosity

    In March 2022, a government committee in Israel tried to amend the ‘from uniform to university’ law in order to enable combat soldiers to receive a totally free university degree, rather than the 75% grant which is currently given. Without getting into the politics of the specific situation, several experts explained that soldiers who have to pay 25% towards their degree take it much more seriously than those who are handed it on a platter. That same rationale holds true with parents who are helping their adult children financially.

    If you are in the fortunate position of being able to help your children buy a home, you are giving them an incredible advantage by enabling them to own a property and not be strangled by a huge mortgage. However, even if you are able and have decided to help them so they don’t need any mortgage at all, make sure you sit down with them and discuss their finances and budget. For their own benefit they need to understand that going forward they must support themselves, and budget according to their standard of living, not according to your living standard.  If you help them buy a property that is too large for them to afford given their earning potential, think carefully whether you are you doing them a favor or not.  By buying them a home and not giving them the tools to manage it themselves you may well be setting them up for financial instability and irresponsibility.

    Grandparents get great joy from buying necessities and gifts for grandchildren, but the same rule applies. Your kids must recognize that you are providing what you want and when you want, rather than be considered a constant financial support in the raising of your grandchildren.

    As I mentioned earlier, you are doing your children a favor when you make them take an active role in their financial stability. You are helping them become responsible and independent adults, who will hopefully raise their children in a similar way. But you’ll be doing yourself a favor too.

    Stress-free retirement

    Unfortunately, I have seen too many cases of people who have given so much to their children that they don’t have enough to ensure that they can retire without worrying about their finances. The individual cases vary, but the bottom line is that these very generous parents were unaware of how their constant giving to their children, could not only hurt their own retirement plan, but also be a detriment to their kids.

    If children have been raised to expect financial help from their parents, they then grow into adulthood with those same expectations. After all, why would they think otherwise?

    In the meantime, the retirees need to cut back at a time in their lives when they should be enjoying the fruits of their decades of labor. Unfortunately, this creates a lose/lose situation for all concerned.

    Communication

    A close-knit family is possibly one of life’s greatest blessings. My warning against over-indulging financially is in order to avoid a rift and help you create a financially stable future for yourself and your subsequent generation(s). If you see that financial dependence is being created, talk to your children and discuss the situation. If you can’t do it yourselves, consult financial professionals to help structure plans that will lead to financial independence.

    Parenting is probably the most rewarding, challenging, inspiring, demanding, invigorating, draining, full time and never-ending job in the world. We all want what is best for our kids, regardless of their age – we just need to recognize that sometimes that means holding back in order to let them grow. Behatzlacha!

    financial responsibilityfinancial responsiblity for childrenlimiting financial helpteaching financial independence
    • Share
    • Tweet
    • Share
    • Pin
    • Share
    • Email
    • SHARELimited vs Limitless Generosity
      • Share
      • Share
      • Comment
    Previous ArticleTime to reset
    Next ArticleA tale of two Novembers
    shaniecooper

    You may also like

    Navigating widowhood – (part two of a two-part series by Debbie Sassen, Financial Planner and Felicia M Seaton, US Estate Planning Law Practitioner)

    Your business – balancing your dream and your livelihood

    Follow up and ramping up for the new year

    Leave a Reply

    Leave a Reply Cancel reply

    Your email address will not be published. Required fields are marked *

    Latest from Financial Planning

    The Great Wealth Transfer

    January 10, 2023

    A tale of two Novembers

    December 12, 2022

    Limited vs Limitless Generosity

    November 6, 2022

    Time to reset

    September 21, 2022

    Think small and achieve big

    August 21, 2022
    See all posts from Financial Planning »
    stay informed - sign up for our newsletters
    "A Financial Guide to Aliyah and Life in Israel" by Baruch Labinsky -->
    Contact Us

    +972-2-991-0029

    Facebook
    Facebook
    Twitter
    Visit Us
    Follow Me
    © 2016, labinsky financial website design the virtual paintbrush
    Terms & Conditions








      Labinsky Financial is pleased to offer a variety of useful financial services.


      (required)

      4 + 4 =