As you approach retirement, your own future may not be the only thing on your mind. You also may be giving a lot of thought to your adult children’s future. There are certain worries you may have on this front, such as concerns over whether your kids will have the resources they need to accomplish their goals. This could include homeownership goals.
The challenges young aspiring homeowners can face
As a recent article on USA Today’s website noted, current housing market and economic conditions pose difficulties for young adults in the millennial generation who wish to buy a home. Examples of common hurdles for millennials to becoming a homeowner these days are:
- Large student loan debt
- Limited income
- Limited assets
- A lot of competition in the home-buying market
- Rising home prices
Many parents of millennials giving their kids financial help with purchasing a home
Given these hurdles, you may have a desire to give your children a leg up to help them overcome these difficulties and achieve their home-owning dreams. One thing you may be thinking about doing is giving your kids financial help when they are looking to buy their first home.
You’d be in good company. The above-mentioned article suggests that it has become rather common for parents of millennials to give their kids financial help with purchasing a home.
In 2015, around 17 percent of parents of millennials anticipated that they would be providing their kids with help when it comes to purchasing a home sometime in the following five years, according to a survey by GFK Custom Research North America. This was up by nearly a third from a similar survey from 2010.
Gift vs. Loan
When you are planning to give your children help with buying a home, one thing it can be important to think about is what kind of help to give. Two of the main options for giving such financial support are to give a gift or to provide a loan. These two options differ in their legal and tax implications and in their potential relationship ramifications. So, when deciding which route to go, it can be important to give careful thought to your goals.
Planning for providing your children with home-buying help in the future
If you are hoping to give your adult children help with buying a home in the future, among the worries you may have is that unexpected events, such as a sudden illness or an early death, could prevent you from doing so.
Estate planning provides individuals with ways to prepare for these types of unexpected events and put protections in place for their goals. This includes goals they have for giving financial support to their adult children in the future.
Estate planning attorneys can provide Georgia parents who desire to give their children homebuying help in the future with guidance on what steps they can take towards such a goal in an estate plan.