Reader Lou Rose responded to yesterday's post about retired Professor Robert Pritchard's suggestion that Social Security eliminate penalties for working and collecting between age 62 and full retirement age.
He wrote that he and his wife were working past full retirement age -- 66 -- in order to save at least a year's worth of cash. But he worries that the money will end up going to help out their adult children. "Saying no is a skill we really need to learn," he said.
Then he threw out the question, "Any suggestions?"
All I can say is that Rose isn't alone. A survey released this week by TD Ameritrade, reported that 76 percent of baby boomers surveyed say they would feel obligated to financially support their adult children if asked. And, not only did 57 percent say they are willing to support them -- even if it takes away from their own retirement -- but 54 percent have actually had adult children older than 25 live with them for three months or longer. Of those, 42 percent admitted that taking their children back in had a negative impact on their finances.
To people like Rose, Lule Demmissie, managing director of investment products and retirement at TD Ameritrade, says, "While boomers may have the best intentions, they could be setting the wrong precedent by financially supporting their adult children, particularly when it comes to discretionary items."
He also makes what I see as a sensible suggestion: "Work as a team. Have an honest discussion with your family about your financial goals and expectations. Set a new budget and develop a timeline together to help everyone regain his or her financial independence."
This kind of tough love makes perfect sense in retirement planning terms, but it is easier said than done. Just ask Lou Rose.