That’s what we don’t talk about. Not many people post stories on Instagram about “I just bought my first house!” along with “My mom needed help paying the mortgage.” post.
For many of us, relationships with family and friends are where money moves from a simple numbers game to a complex mix of emotional and financial obligations.
As a former Wall Street trader, founder of Your Rich BFF, and author of Well Endowed, who made his first million by age 27, I know it’s important not to let these things fall by the wayside.
Finding the delicate balance of being there for loved ones while establishing your own safety net is different for everyone, but no matter the situation, if you don’t plan and set boundaries, you’re almost guaranteed to end up in an awkward situation. Because, although it is great to give endless help to your nearest and dearest, you also cannot light yourself on fire to warm others.
There are many “teach a man how to fish” tactics you can use to help your parents without literally giving them any money.
1. Help create a budget
While you don’t have to sit down and go through your bank statements line by line, there are plenty of youth savings hacks (like bill negotiation) that can help reduce your annual cash outflow.
2. Help set up catch-up donations
If your parents will be 50 or older by the end of the calendar year, they may be eligible to make so-called “catch-up” contributions to certain retirement accounts that exceed the normal limits for IRAs, Roth IRAs, and 401(k) plans. (Sure, it takes less time for the money to grow by the time they retire, but every little bit counts!)
3. Help research support programs
Beyond Social Security and Medicare, there are many public and private programs, grants, and organizations that help seniors cover living expenses, lower utility bills, and access to boxes of farm-fresh produce. Check with your parents’ state or county’s aging department to see what’s available and help with the paperwork (and possibly an online application).
4. Help people avoid being scammed
Sadly, the older you get, the more you become a target for all kinds of financial scams, from “I’m Brad Pitt and I need money to get out of this hospital” to “This is the FBI, send me $3,000 in Target gift cards right now.” Sharing examples of these stories (without judgment) with your family will help them keep their eyes open.
5. Helping you downsize
To ease the emotional burden, volunteer to help organize your children’s belongings and get rid of unnecessary items. If they’re looking to sell their car and haven’t been able to get the hang of it, help them put it on Craigslist. If they’re thinking of selling their home and moving somewhere smaller (and cheaper), offer to help out as an extra helper.
6. Help families maintain rent payments
A Family Opportunity Mortgage (FOM) is a type of loan designed to help purchase a home for elderly parents or disabled adult children. If your family is in need of a home and you have the cash for a down payment, this can be a solid option. Instead of paying rent to a landlord or nursing home, you pay rent to you, the property owner.
Additionally, FOMs tend to have lower interest rates and lower down payment requirements (around 5% of the purchase price), so this can be a win-win if it suits your situation. Your parents will be able to live in a more homely place and at the same time help you acquire title to the property.
7. Help them earn extra cash
Fun fact: There is nothing in the rulebook that says you can’t hire your parents.
If you have children, you can also pay one of your parents to act as a nanny while you work. If you’re going out of town and need someone to keep an eye on Rover, offer to pay for the dog to be left with the parents. If one parent has unique skills, such as a former plumber or retired English teacher, pay for their expertise to fix a leaky pipe or proofread a resume.
For many seniors, this not only helps them avoid the feeling of receiving “benefits” but is also a fun task to keep their mind and body active.
Vivian Tu is a former Wall Street trader turned expert, educator, podcast host, and founder of Your Rich BFF. She is the author of Rich AF: The Winning Money Mindset That Will Change Your Life and Well Endowed: The Secrets to Strategic Spending, Building a Financial Foundation for You and Your Family, and Create Lasting Generational Wealth. Follow her on TikTok, YouTube, LinkedIn, and Instagram.
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