Advice | 5 tips on financially helping your parents in your 20s and 30s (2024)

FAQs

How to financially help your parents? ›

Make sure you have a clear agreement about the form of help, such as a loan or gift, and any terms for repayment. If you want to give the person something outright, consider giving them cash, paying one of their bills directly, or providing them with non-cash assistance, like gift cards, or certain resources they need.

It's important to make clear to your adult kids that it's their responsibility and in their best long-term interests to earn their own way. Stress that any financial assistance you provide to them should be viewed as a bridge to their eventual financial independence — and not a handout.

Once you have a child, financial planning for the future becomes even more essential. How will you finance child care, medical bills, food, education, clothing, toys, and education savings? What will you need to spend money on and how much will each item cost?

California. CA Fam Code § 4400 (2018) “Support of Parents” makes adult children responsible for supporting “a parent who is in need and unable to maintain himself or herself by work.” However, the law states that this applies unless “otherwise provided by law.”

Ensure your parents have an up-to-date will. You can explore establishing trusts for asset protection and estate planning. Consult with an estate planning attorney to tailor a plan that meets your parents' specific needs and wishes. Consult with a financial advisor experienced in elder finance issues.

Filial laws require children to provide for parents' basic needs such as food, housing, and medical care. The extent of filial responsibility varies by state, along with conditions that make it enforceable including the parent's age and the adult child's financial situation.

Isabel Barrow, the director of financial planning at Edelman Financial Engines, advises clients to agree on a deal: Parents will offer some financial support to their children, if their kids are also making decisions that support their own financial future in other ways, such as contributing 10% of their salary to a ...

How to help adult children get out of debt? ›

Rather than offer direct financial help, you can provide moral and administrative support. You can encourage them to work with their lender on a payment plan or a loan modification. You can help reach out to the lender and assist with organizing their mortgage paperwork. Help doesn't have to be financial.

Consider offering relief to your parents in the form of direct gifts. To avoid potential tax consequences, you can give up to $13,000 per year if you're single, and about $52,000 if you're married. Or you could simply pitch in for medical bills and insurance directly by sending money to your parents' providers.

Filial laws require children to provide for parents' basic needs such as food, housing, and medical care. The extent of filial responsibility varies by state, along with conditions that make it enforceable including the parent's age and the adult child's financial situation.

If your parent has no way to repay her debts, speak with an attorney about bankruptcy. Look online for an attorney who offers free legal help to seniors. If your parent has decided to let you take over her finances, you will need a power of attorney to speak on her behalf.