There are two schools of thought when it comes to the parent’s involvement in their children’s financial future past a certain point in life. According to the first group, by helping your kids, you’re preventing them from exploring their full potential, seeing as how they’ll develop a habit of expecting you to bail them out whenever there is a problem.

On the other hand, there are those who believe that the world of real estate is A) best when entered early and B) too complex and horrifying for a young person to venture into alone. If these two statements seem contradictory, that’s because they really are. Therefore, it would be for the best if you were to help your children get onto the property ladder while you still can.

Make Sure You Can Actually Afford It

Having all the best intentions in mind is great, however, you need to figure out if you can actually afford to lend a hand to your kids in such regard. Even if you don’t have the cash lying around, chances are that you have a much better credit rating and a more valuable collateral to offer to a credit union, which means that you can get a much better loan than your kid can. Aside from this, you need to think about whether you should lend them this money or simply give it to them. From a didactic standpoint, it’s probably for the best if you find a middle ground. First, have them repay you and then, once you get assured of their diligence and make an estimate that you can make it, forgive the rest of this debt.

Figure Out The Impact On Your Own Lifestyle

Once you make it past a certain age threshold, your lifestyle necessities might start shifting. This can be a great thing, seeing as how you can sell your house and look for local retirement homes where you’ll have both company and medical care. With the money you get from the sale, you’ll be able to help your kids out, however, keep in mind that you need to keep something for yourself.

Think About The Inheritance Tax

Remember that no one is immortal, which is why you need to think about the money you’re giving to your children and do it as soon as possible. Otherwise, your children might be forced to pay a substantial inheritance tax on the money you wanted to give them unconditionally. Sure, you’re still allowed to give your children some money as a gift (every single year), yet, there’s a limit to how much you can actually bestow onto them. This is something that varies from one country to another and is definitely worth checking out.

They Have To Pull Their Own Weight

The last thing you need to keep in mind is the fact that making this too easy for your children won’t do them a favour in the long run. Even if you can effortlessly afford all of this, you shouldn’t do it for several reasons. By allowing them to pull their own weight and teaching them how to save and invest money, you’ll prepare them for the time when you’re no longer around to look out for them. In this way, you’re doing them more of a favour than if you were to outright buy and give them their first property.

In Conclusion

Lastly, you need to keep in mind that not all help is of a financial nature. What this means is that you, as a homeowner and someone who’s already been through this process, have some invaluable advice to offer to your offspring. Still, keep in mind that advising and imposing your will on your kids are not one and the same thing. Therefore, you might want to take a softer approach.