Parents Using Kids' Savings To Pay Bills

[jeffrey]

Wilmington, DE- Tough economic times have forced parents to cut back on their kid’s savings while also reaching into their kid’s pockets to pay daily household expenses, according to a new survey released by ING DIRECT. The new survey also showed while parents are tapping into their kid’s savings accounts, they’re more prepared to talk to their children about drugs and alcohol or sex and dating than money and finances.

According to the survey results, one in three parents (34 percent) have reduced the contributions they make to their children’s savings, and nearly one in five (18 percent) parents who have savings set aside for their children have taken money from their children’s savings to cover bills or pay off debt.

“It’s clear that parents are struggling with their expenses during these difficult times, but tapping money put aside for their kids will only exacerbate a family’s problems when it comes time to pay for college,” said Arkadi Kuhlmann, President of ING DIRECT USA, the nation’s largest direct bank. “Parents need to set an example by setting up an automatic savings plan. A ‘set it and forget it’ savings mentality makes it easy for parents to save, while teaching their children about the importance of putting some money aside for future needs.”

Even as parents tap their children’s savings accounts, many are not preparing for their children’s financial future.

· One in four (27 percent) parents with children under the age of 18 do not have any savings set aside for their children.

· The number increases to one in three (33 percent) for parents in the 35 to 44 age bracket who typically have children approaching college age.

When it comes to speaking to children about finances:

Two in five (39 percent) parents are more prepared to talk to their children about drugs and alcohol than money and finances.

Nearly three in ten (27 percent) parents are more prepared to talk to their children about the birds and bees or dating than money and finances.

Although a large number of parents feel they are not prepared to talk about finances with their children, nearly all (94 percent) parents believe that they are primarily accountable for educating their children about the importance of money and responsible spending. However, the survey results showed that 96 percent of parents feel financial education should also be taught in school. Almost half (42 percent) of parents think schools should start teaching financial education before fifth grade, and eight in ten (82 percent) think it should happen before high school.

The national online survey was conducted within the United States by Harris Interactive on behalf of ING DIRECT between April 6-8, 2009 among 2,123 adults age 18+, 535 of whom were parents of a child under 18 years old.

[simpleyme]

my childrens savings acounts hold the money they have actually earned or recieved as gifts it is theirs I would not touch it as thet would be stealing plain and simple

I do know some people open savings acounts for their kids and just slosh money into it,not sure about that

my older brother was a hard working kid he would make money doing things for neighbors ,he would clean out the shake mill up the road,clean horsestalls, mow lawns ect..... my stepdad would take his money and spend it they would write it down as money owd to him , my brother still talks about it to this day how dad stole his money
I vowed I would never do that to my kids as it really damaged my brother ,he hardly works a day of his adult life and I believe at least a small part is do to this theivery by my parents

[kork13]

About a year ago, my parents borrowed about $1500 (combined) from savings accounts for my middle brother and I (held at a credit union near my grandparents' home) that we've had most of our lives. They needed it to repaint their home and do a couple minor repairs before they could rent it out. My mother (elementary school teacher) was not working then, and for a few reasons, they didn't have the free cash to do it at the time.

However, I'm not overly concerned about the money... My brother and I were completely agreeable to it, and now that my mother is also working again, they have more free income. I believe that my brother's account has already been repaid, and once she has the $1k for my account, she'll get it put back in there -- no harm, no foul. The paint job, btw, looks outstanding. ^_^

I explain all this because I see two sides of the coin. Money taken from a child's account without their knowledge and approval, or without a plan/intention to get it repaid....yea, I think that's wrong. The other case, where the child is in agreement and there is a definite plan to have it repaid, I have no issue with that situation. It's a loan, and much better than going into CC or bank loan debt.

[simpleyme]

if parents are in need I and ask I would not have a problem with giving them money
I can honestly say I would never borrow money from my kids

my DIL laws parents borrow money from her all the time,I do not think parents should be asking kids for money,it should be the kids going to the parents!

DIL parents are terrible with money older than DH and I and have nothing ,their other son got in trouble and they asked DIL to use the money she had saved for college to bail him out,she asked me and I told her do what you want but your parents should have the money its not a lot and the fact they want to borrow your school money(they did not save it for her ,she earned it at work)to pay a lawyer for your brother is messed up


some people are just bad parents I doubt this economy really has increased this bad habit
it just makes it more okay to do it" what else could we do in this economy"