Dear Dr. Per Cap:

One of my grown kids still lives at home and the other just asked me to co-sign a big loan.  I love my kids but I’m overextended.  How can I cut them lose without drama and chaos?

Signed,

Maxed Out Momma

Dear Maxed Out Momma

This official name of your dilemma is the “failure to launch” problem.  It’s not uncommon these days in Indian Country and elsewhere.  In all fairness the rough state of the economy is partially to blame.  High costs of living, stagnant incomes, and soaring education costs that contribute to student loan debt are pushing Millennials and Gen Zers down a more challenging financial path than previous generations.

However, young adults also can’t resolve to be victims of financial precedent.  Time for a dose of tough love.

The question that needs asking is why do your adult children lack independence and self-sufficiency?  I recommend asking them directly rather than just contemplating it yourself.

If your kids work hard and make good decisions but they’re still struggling you might want to go easy on them.  But if junior enjoys couch surfing and playing X-Box while you’re stressing to pay the bills something has to change.  Moreover, a co-signer might be a reasonable request for a sensible purchase, like an affordable vehicle to commute to work or a down payment on a modest home.  Co-signing for a fully loaded SUV so someone with lousy credit can look cool?  Hit the brakes!

First make it clear that your love is unconditional and your children are always welcome in your home; however, you won’t carry their financial burdens indefinitely.  Consider even showing them the numbers on paper so they can see for themselves how thin you’re stretched.

Next give the adult child living at home a timeline, say three months to get their own place.  If they need help, provide as much support as you can reasonably offer.  Maybe cover the deposit on an apartment or connect them with an employment services program.  Your tribe’s human resources department or social services are a good place to start.  Then stick with the timeline.

If the co-sign relates to an over-the-top purchase, like the SUV, flat out refuse.  If it’s something reasonable, look closely at the purchase.  Maybe there’s a cheaper option that will eliminate the need for a co-signer or even having to borrow altogether.

Drama and chaos can be avoided if you’re firm but fair and your kids realize your heart is in the right place.  I think just about everyone has had to turn to their parents to help cover a financial setback at least once after reaching adulthood.  I know I have.  The good news is that nothing beats the feeling of pride and accomplishment after finally flying the nest.  Don’t hold your kids back by enabling them for too long.

Ask Dr. Per Cap is a program funded by First Nations Development Institute with assistance from the FINRA Investor Education Foundation. For more information, visit www.firstnations.org. To send a question to Dr. Per Cap, email askdrpercap@firstnations.org.