There is a jarring lack of parental control when high school and college seniors come into some cash upon graduation – anything from a $100 check from Grandma to multi-million dollar inheritances…While it's still a little scary for parents to lose control, here are four strategies to make sure that new young adults handle graduation gifts responsibly.
As we move from spring into summer, many of our young loved ones are entering their own transition periods and marking some of their first real life milestones. It is graduation season, which means it is graduation gift-giving season. If you hope to mark your loved one’s accomplishment with a sizeable gift, then how do you ensure that such gift is not squandered?
To mark a milestone with a financial gift can be something of a carrot-and-stick opportunity. If that is the case, then the trick is to ensure that the gift encourages positive possibilities instead of some shiny mess with a new car smell. Reuters recently provided some advice on this timely topic in an article titled “Four ways to influence how new grads handle money.”
In some ways, the advice for giving money to young adults does not hinge on the number of dollars involved. In fact, from $100 to $100 million, and however you slice it, the goal is to ensure a responsible use of the funds. Then again, with high-value gifts or full inheritances in the mix, there is that much more that can go wrong. Fortunately, there are more tools at your disposal to structure a successful gift.
The advice in the original article is well worth thinking about, whether your potential gift is imminent or not for another four years of high school, college, or an advanced degree. Knowing full well the value of an approaching milestone, it is the sort of thing you can begin to plan for well in advance and doing so in the midst of this advice can really make the best of your gift.
You can learn more about this topic as well as other strategies on our website under the tab entitled: estate planning in Virginia. Be sure you also sign up for our complimentary e-newsletter so that you may be informed of all the latest issues that could affect you, your loved ones and your estate planning.
Reference: Reuters (May 14, 2014) “Four ways to influence how new grads handle money”