Life after university can be an excruciating reality check. It is abundantly evident now with many adults aged 18-34 living with their parents instead of with partners or flatmates, as high student loan debt and premium rents coupled with low earnings are making independent living a challenge.
Therefore, parents can again come to the rescue by financially helping their children get on their feet in the following four ways:
- SHOW THEM THE MONEY
A straightforward way to help your child is by just giving them the funds they need. Talk to your offspring so you can understand their exact shortage of funds and assess how much you can realistically help them out with.
Whether you want them to pay it back or not is completely up to you. If you expect them to pay it back, you need to make it clear and set up an agreement with them. Will they pay it back in monthly instalments? When they’re earning a certain amount? These are things that you need to settle on.
- GUARANTEE THEIR LOAN
A widely popular way to ease your child’s financial woes is by acting as a guarantor. It has quickly become the only option for those who are unable to attract sufficient funds from the lending institutions due to modest income streams, a bad credit score or simply no credit score being a fresh graduate. Your guarantee acts as the pivot that propels your child’s borrowings.
It is also helpful to know that unlike in the past when guarantors had to put up with the entire default amount, now there are lenders who are offering loans that do not require a credit check nor require one to place anything as collateral. Nonetheless, it is admissible to seek professional help so that you understand whether it is a viable option for you and your child. Applying online for a guarantor loan is one of the easiest methods of securing one, as lenders have made the process much simpler. Websites I’ve explored such as TrustTwo provide you with a simple form for your child to fill in on the home page, so you won’t have to walk them through it. They simply select who the guarantor is, how much they need to loan and the payment term. You can explore this through the following link: https://www.trusttwo.co.uk/. And if you need a credit check, have a look at this review of creditsesame.
- EDUCATE YOUR CHILD FINANCIALLY
Of course, your child theoretically knows all about monetary management courtesy of the wisdom you imparted on them. However, his or her financial woes indicate that you need to inculcate some financial wisdom in them. Sit down with them and come up with a financial plan.
Share with your offspring the financial mistakes you committed in the past. This will not only emphasise to them that they are not a failure, but will also help them to learn and know what to avoid.
For tips on how to teach your teen to better manage their money, look here.
- GRADUALLY GIVE THEM MONEY/ESSENTIALS
Another pragmatic way to ease your offspring’s money struggles is by transferring the monetary support gradually instead of in one bulk payment. For example, consider facilitating them out with the gifts of necessary items such as a dryer or a refrigerator if they’ve just bought a new house. Moreover, if they are getting a home mortgage you could think about giving them a monthly gift to pacify their mortgage payments.
By adopting this strategy, you are making your child independent while also assisting them financially.
This post is in association with Trusttwo