Every parent wants “the best” for their children, but what exactly “the best” entails can be very different from one family to another.
As a general rule, parents love their kids and would do anything for them. However, due to a lack of financial literacy, parents with fantastic intentions end up hurting their children.
They go down to the dealership, put down a $300 down payment, sign up for some payments, and then give you the car. Along with the responsibility to make the payments!
It doesn’t address any financial need they actually have. And now they have no idea what to do with it, so they just start making the payments, too!
Now the kids feel like they have to vacation at that location (maybe even with the parents). They can’t afford the annual fees.
They’re not yet financially ready to be buying the home in the first place. So, the parent is really enabling the kid to pick up a liability and live beyond their means.
I appreciate that parents want to help their children pay for college. I think it’s great—unless they are borrowing to do it.