While giving your kids financial support to settle into adulthood makes sense in today’s economy, it can also stand in the way of their independence, says Lana Johnson, Franchise Principal and Financial Adviser at Consult by Momentum.

“I want to give my kids just enough so that they would feel that they could do anything, but not so much that they would feel like doing nothing,” said American billionaire Warren Buffett.

While most of us don’t have billions to give our kids, we can all relate to the challenge of wanting to give them a leg up without spoiling them. Of course, you want life to be easier for your kids than it was for you – isn’t that the point? And getting started in life is so much tougher than a generation ago. Everything is more expensive, from groceries to a first home to a tank of petrol.

But the Bank of Mom and Dad paving the way with easy money can quickly do more harm than good.

The problem for many parents is that adulthood looks very different to what it did a generation ago. We may have left university with a degree tucked under the arm and a guaranteed job on the horizon, with a single income that was enough to sustain a family. But those days are gone. A tertiary qualification doesn’t ensure a job and even a small flat in the city costs many more zeroes than a young adult can afford.

Many parents would rather provide support while they are alive and able to see the impact than wait for their children to benefit from an inheritance one day. In principle, there is nothing wrong with this. The challenge is ensuring that support creates opportunity, rather than dependency.

Perhaps you continue paying your kids’ monthly cellphone bill or keep their car on your insurance, instead of forcing them to take out their own. Looking after some of their monthly expenses frees up money for them to save, right? More often than not, this isn’t the reality. You might think that R1,000 you’re “saving” them by paying the medical aid debit order is going straight into a retirement plan, but let’s be honest – if they don’t know how to budget, that extra money is just funding their lifestyle.

The real danger is that financial support can shield children from some of life’s most important lessons. Nobody enjoys struggling with money. That end-of-the-month Salticrax is dry as bone. Yet that is how people learn how to make better decisions. When Mom and Dad are always there to step in, children don’t get the chance to figure things out for themselves. They start seeing financial help as normal. And crucially, they don’t learn that they are resilient and smart and can do things on their own. If they don’t develop those skills with their budget, how will they cope when life throws something really hard their way?

The answer is not to cut kids off cold turkey. There is an important difference between helping a child move forward and rescuing them from the consequences of poor financial decisions. Assisting with studies, a first property deposit or a temporary setback can be constructive. Continually paying off debt, covering overspending or repeatedly bailing them out of financial trouble is far less likely to build long-term financial capability.

Parents need to help them in a way that builds independence, rather than fostering reliance. We need to understand that financial know-how is built over time and that our children should learn to think through decisions that have financial implications.

You can start by swapping free-flowing support with clear boundaries. If you’re paying their medical aid because they are still a dependent on your plan, you could say that you’ll cover it for another six months, after which they have to take out their own. If you want to help with a deposit for a property, work out an affordable payment plan.

Most importantly, help them understand their expenses and work out a budget. Many young adults don’t have a clue how much things cost and what they need to include in their budget. Point out to them that toilet paper doesn’t magically appear in the bathroom – they have to pay for it. That car they want comes with insurance and maintenance costs. Those weekly takeaway orders quickly add up. The earlier you have these conversations with your kids, the better prepared they’ll be.

Parents can also use financial support to encourage good financial habits. Youngsters in their first job don’t always think about retirement, but you could offer to match their contributions for a year, thereby showing them the power of discipline and early planning. You can also turn birthdays or accomplishments into opportunities for saving, by adding to an investment account.

Of course, every child responds differently. Some view financial assistance as a stepping stone and quickly take responsibility for their own finances. Others begin to see support as an entitlement. The same help can produce very different outcomes, which is why parents need to pay close attention to whether their assistance is encouraging independence or simply prolonging reliance.

The job of a parent is to raise an adult. That means giving your children enough support to get started, while allowing them to build the skills they need to soar on their own. The most successful Bank of Mom and Dad is the one that’s no longer needed and can close its doors for good.