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When supporting an adult child crosses the line into enabling, and how to offer targeted support to build true independence while also protecting your future.
For decades, the financial blueprint of parenting was clear: you build a solid foundation, watch your kids step onto it, and eventually hand over the keys to their own independence. Today, that blueprint is getting turned on its head. It is now more common than ever for an adult child to need a helping hand in life. According to a recent survey by Northwestern Mutual¹, a huge chunk of the population says they rely on their parents for money, including: • 72% of Gen Z (29 and younger) • 53% of millennials • 33% of Generation X Every parent wants to set their kids up for success. But as you balance that instinct with your own life goals (retirement, supporting parents, increasing standard of living, etc…), one question becomes incredibly important: is my support building an independent foundation or masking a developmental deficit? After a lifetime of employment, you’ve earned the financial freedom you worked so hard for. Protecting your financial independence is the foundation that keeps the whole family secure.
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Why stressing over ‘Do I Have Enough’ leaves retirees vulnerable on health, identity, and social connection.
When I ask people if they’re ready for retirement, they almost always assume I’m asking about money. They tell me about reaching 'their number,' shifting to a conservative asset allocation, or refining their withdrawal strategy.
What I actually want to know is whether they are truly ready for the life waiting on the other side of work. That question is usually much harder for them to answer. In a survey of 9,000 adults across the US and Canada, Edward Jones and Age Wave examined what actually makes for a successful and happy retirement. They landed on a four-part framework: health, family, purpose, and finances.¹ Money is just one pillar out of four, yet it absorbs nearly all our retirement planning energy -- even though close to a third of new retirees in that same study reported struggling to find a sense of purpose once their job disappeared. "Can I retire?" is really two separate questions hiding under one umbrella: Having A Plan Means Knowing What To Do When the Paychecks Stop.  Article Highlights
I'd say retiring early, in some fashion, is a widespread goal of the American labor force. Hell, it's mine too: coffee in hand, the scent of pine, a sunrise morning somewhere in the mountains, sometime before 60 I hope.
That's the dream, financial freedom, the ability to do whatever you want whenever you want. Who wouldn't take that? But for the millions of Americans chasing it, success in retirement is impossible without a good plan. So many hinge that plan on a 401(k), an IRA, and Social Security, when in reality, they aren’t enough. To tell you the truth, odds are slim that any of us actually gets to choose our own retirement date. And if we don't get to choose, we're being forced out of the workforce for exogenous reasons, not because we decided the time was right. So what happens on the day the paychecks actually stop? The 401(k), the IRA, Social Security: these are real answers to a real question, which is how did you save. They don't answer the question that decides whether your retirement works or not. How much of that money you can safely spend, in what order you draw it down, and what happens if you don't get to pick when it starts are the much more important retirement questions.  Article Summary: Despite a statistically better long-term performance record than men, women tend to worry about money more. That combination sounds contradictory until you look at what women are actually up against: a longer lifespan to fund, more career interruptions, lower lifetime earnings, and a wealth management industry built around someone else's financial life. The anxiety starts to make a lot more sense once you do the math. If you look at the cold, hard data, women make great long-term investors. Multiple massive datasets confirm it: they trade less, follow the plan, and routinely outperform men over the long run.
Yet, when surveying a general audience of women about how they feel about their financial future, the answers rarely invoke confidence. Instead, women report significantly higher financial anxiety, worry more about outliving their savings, and are far less likely to even call themselves "investors."¹ Why does this paradox exist? The answer: women aren't "lacking confidence"; instead, they are accurately calculating a much more difficult economic problem. To bridge this gap, we have to look past standard industry narratives and examine exactly why superior performance and heightened anxiety coexist -- and why acknowledging this paradox is the key to fixing the system.  In This Article:
Somewhere in your early-to-mid 40s, a particular kind of exhaustion hits. You've been running at full capacity for so long that the tiredness makes you numb. Not only numb to the pace, but somewhere along the way, numb to the decisions you stopped making for yourself.
Often, days start to look something like this: you handle a work crisis before 9am, field a call from your kid's school, schedule a follow-up for your dad's latest medical issue, have a quick text exchange with your mutually hardworking spouse about who's covering pickup, get back to the work crisis, and then realize it's 4pm and you haven't eaten. You fix one problem and three more surface. You get through the week and the next week is identical. There's no slow period coming, this is just the pace of life now. The standard retirement calculator gives you a simple output and a false sense of certainty. The reality, hidden inside that 7% CAGR assumption, is a wide distribution of outcomes that can span millions of dollars. How timing luck can shape your retirement balance regardless of how well you saved.  Meet two retirees. We’ll name them Linda and Mark.
Linda retired at the end of 2008. Mark retired at the end of 1999. Both worked for 40 years. Both contributed the same amount to their 401(k)s. Both invested in a basic S&P 500 index fund. Neither panic-sold during crashes nor tried to time the market. They simply just invested their savings in their retirement accounts for the entire span of their careers. Linda finished with roughly $1.52M in today's dollars. Mark finished with roughly $4.97M. Same strategy, same discipline, same 40-year horizon, and a $3.45M gap between them. The only variable difference was the years they started and ended their careers. Now, go open any standard retirement calculator. Plug in their identical inputs: same contributions, same 40-year horizon, same 7% average assumed return. The calculator will spit out one number for both investors. It has no way of telling you that there is a wide range of outcomes somewhere between $1.52M and $4.97M, and that where you land inside that range is drastically attributable to the whims of the stock market. It's a structural problem with how retirement planning is oversimplified in its presentation. It only gets worse when you layer on what the behavioral research says about how people like Linda and Mark actually behave during their careers. The fear of running out of money often results in an overly conservative retirement plan. The flat-line spending model doesn't properly reflect the math behind a typical retirement spending glide path. Here's what the research suggests we do instead.  Open up almost any retirement planning tool, run a projection, and 99% of the time you’ll see a flat withdrawal rate (usually 4%) from 65 to 90, adjusted for inflation. It’s predictable and tidy.
It's also entirely oversimplified. The problem with the flat withdrawal rate is that it implies you, at 65, will have the same spending behavior as you at 85. Do you think you’ll have the same appetite for life, same desire to travel, same interest in a new car, same urge to go out for a drink at these vastly different ages? Probably not, right? Aging is dynamic. Every stage of life looks very different at its beginning versus its end. When your financial plan is built on a flat line, the math often tells you there's a crisis looming at 90 that demands significant restraint today. The result is a scarcity mindset that isn't entirely reflective of your evolving financial wants and needs.
Research from Stanford Medicine reveals that aging happens in sudden shifts — not gradual decline. Here is a roadmap for deciding when your money should be used when factoring in good health.
When Your Body Peaks vs When Your Money Peaks
I’ve sat across from a lot of people who spent their financial lives doing everything right. They contributed significantly to their 401(k). They stayed the course through volatile markets. They deferred and saved and planned.
Then, they retired at 65 and watched their nest egg continue to grow; the habit of not spending had calcified into the default mode of their lives. What most current and prospective retirees don’t know, and what many financial plans don’t factor in, is that there’s a risk in financial planning that doesn’t show up in projections or Monte Carlo simulations: Capability Risk, or the risk that your wealth arrives after your ability to fully use it. Money compounds, but your ability to enjoy it doesn’t.  There is roughly a 50% chance that at least one partner in a married couple will live into their 90s.¹ And the 90+ population is projected to grow rapidly as medical advancements continue to push life expectancy further into the 21st century.
Simply put, we are living longer than ever, yet we continue to invest as if life ends at 65. From the autopilot glidepaths of Target Date Funds that begin cutting growth decades too early, to retirees who stay "defensive" five years into a thirty-year retirement, the typical investor has traded the temporary discomfort of market volatility for the permanent risk of outliving their money. While a number of factors contribute to seniors’ affection for low-risk assets (the 24-hour news cycle, structural pessimism², etc.), the advice industry itself has normalized excessive conservatism as the default. My view is more straightforward: unless you are in the Retirement Risk Window (the critical five-year window immediately surrounding your work exit date), over-allocation to safety has likely harmed long-term outcomes more than it has protected them.  I recently watched Jay Kelly on Netflix, where George Clooney plays a fictional movie star who dedicates his life to his craft and succeeds by every external measure. The catch? He later admits to choosing his career over his family, only to realize he’s missed many of life’s most meaningful moments and relationships.
I don’t generally sit down to watch a movie looking for financial metaphors, that would be weird. But every so often, a story brushes up against a question I already spend time thinking about. In this case, Jay Kelly’s story happened to remind me of the FIRE movement. Whether it’s Coast, Lean, or Fat FIRE, the core philosophy is the same: front-load sacrifice in your early years to buy freedom later. The math is sound. Saving aggressively from an early age is essentially the equivalent of a financial superpower. The appeal is also undeniable. Who doesn’t want the freedom to do whatever they want in their 40s? I’ve always joked that my dream job is retirement, and FIRE is a good mechanism for getting me there. But the FIRE movement raises a complicated set of questions. What are the movement’s disciples missing by deferring their lives in their 20s and 30s? And how do we find the "goldilocks" zone between saving responsibly for the future and actually living along the way?  Did you know that the most popular finishing time for marathon runners is 3:58?¹ A while back, I read about common marathon themes in Adam Alter’s Irresistible and came across a fascinating detail: finish times aren’t distributed smoothly across the clock. Instead, runners cluster at round numbers (3:30, 4:00, 4:30).
The evidence points to a meaningful takeaway: people will sprint to cross a finish line before a psychological threshold. Cross at 3:59 and you’re triumphant; cross at 4:01 and it feels like you fell short. This isn’t unique to running a marathon. Psychologists call this the goal-gradient effect: as we approach a target, our motivation increases sharply.² Runners sprint the last mile. Sandwich shop customers order more often when their punch card is nearly full. Investors save harder when they’re closing in on a milestone.³ |
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