Awhile back a subscriber to my newsletter posed a question that set me aback.
It said: “How far should parents go in helping their financially irresponsible son and wife, with 3 kids? I’m frustrated, but can’t let go because of the grandkids. My son has a steady job, but bad credit and can barely afford a place to live. What should I do? Thanks.” After a few days I cobbled together a reply of sorts, stressing the importance of financial responsibility, the virtues of thrift, and the sanctity of family values. Looking back now on what I said, it’s clear my response didn’t contain one word of practical value. The writer wanted recommendations on how to resolve a pressing problem, and I didn’t have a clue.
Now, after a couple of months, I better understand the inadequacy of my reply. The problem posed doesn’t lend itself to resolution. Although the predicament may appear to deal with money – or the lack of it – it’s not a financial dilemma. It goes far deeper and is the result of a lifetime of behavior that failed to be addressed a quarter century earlier.
Attempting to instill good habits in offspring by their third or fourth decade will prove futile. It’s my belief a person’s attitudes and values are established by the end of puberty.
With that said, let me provide a few guidelines that may help you guide your offspring in more suitable directions.
1. Instruct by Precept and Example. Believe it or not, your children really pay attention to what you say and do. As the first authority to appear, a parent becomes a model on which the child fixates and tends instinctively to emulate. Through repetition, later supplemented with oral reinforcement, a bond of behavior develops that can become an ingrained pattern. However, this input must be consistent if the lessons are to be learned. If the messages are contradictory, they’ll be received as mixed signals. If, for example, parents proclaim the importance of living within their financial means while simultaneously indebting themselves through purchases they cannot afford, it will not go undetected by the children nor induce them to pursue habits of thrift. Only through precept and example will sound habits be engrained.
2. Don’t Encourage Unrealistic Goals. Parents often fail to keep things in perspective. Those who urge their children to aim for the stars while ignoring reality do them no service. One typical example is the encouragement given to attend a prestigious university when funds are insufficient. Over the past years I’ve fielded letters from these children, themselves well into parenthood and overburdened with tens of thousands of dollars in unpaid student loans. In most cases, the grandiose plans never came to pass. Whatever luster a high-priced school is designed to impart generally proves to be illusion. Instead, two years at a community college followed by two more at a local state university, in keeping with my blueprint of college on the cheap, proves far more appropriate. The point I want to stress is realistic and attainable goals must be the basis on which guidance is given. Despite the prevalent attitude in modern society that everyone is endowed to achieve at any level, the wise parent recognizes reality and seeks to counsel the child accordingly.
3. Don’t Ignore Human Nature. A bizarre circumstance concerned an indolent young woman, who over many years repeatedly received instruction from her wealthy father on how to balance her checkbook. She habitually issued checks whenever she chose. If the account balance fell below zero, the bank phoned her father who deposited more money in the account. Somehow her father never understood his instruction sessions ignored human nature; her checkbook balance held no meaning, for the checks always cleared. What’s the purpose of this lesson? It’s to stress the importance of parents’ awareness of what’s meaningful to their offspring. Human nature dictates actions must have real consequences.
A final thought: The ancient adage is correct; as the twig is bent, so grows the tree.
A professional investor for nearly five decades, Al Jacobs holds a degree in civil engineering from Rensselaer Polytechnic Institute, a Real Estate Certificate from the University of California and a Certified Property Manager designation (CPM) from the Institute of Real Estate Management. His written works can be found in the book "Roadway to Prosperity: A Practical Guide to Wealth Accumulation" and also in several newspapers near his hometown of Monarch Beach in Orange County, Calif. Jacobs writes a weekly column for his website.
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