Tell Me About It: Give money with no strings, or set it aside

Adapted from a recent online discussion.

Question: We will soon inherit some money and want to help our adult children. We want them to use the money toward newer cars (or paying down student debt). We can't give enough to buy a new car, but hope to give between $10,000 and $15,000. We are afraid one of them might use the money for something we consider an unnecessary (and dangerous) luxury. Yet we feel she will be insulted if we give conditionally.

What do you suggest we do? Give it and say we hope she will use it for a car or loans? (She is married. They are smart young adults, but I think sometimes they spend more than they should on vacations and extras.) Or should we hold it back and say, "When you are ready to buy a car, we want to help with this much money"? I'm leaning toward Option 1, but am not sure.

Answer: Option 1 actually rubs me the wrong way. Plus, it's the least pragmatic: all the nuisance of trying to control someone without any actual control.

So I suggest you go all in or all out. Either give them the money with no strings, or keep it and say, "When you're ready to buy a car, let us know and we'll kick in X dollars toward it."

You parenthetically refer to Option 3, making a big payment on their education debt - which sounds pretty good, too, and would avoid the presumption that taints the car idea.

Option 4, which might ultimately be the most helpful to a free-spending child, is not to give the money at all, but instead to set it aside for emergencies - job loss, serious illness, divorce, car accident, tree through the roof, lawsuit, whatever. Wouldn't it be something if you had thousands parked and ready to go?

You can also give one portion freely and set another aside.

Short answer: Know your kids, but don't try to control them.

Comment: I say give the money, no strings attached, and accept that they will live their lives as they see fit. It's not really your place to judge how your kids spend their money, or whether they really need new cars. The kids may like their beater cars, or may be trying to get away from owning a car (a popular city option). Maybe they could use the money for a down payment for a house, or pay down credit card debt, or save for a rainy day, or take the round-the-world trip they've hoped for all of their lives.

And, once you give it to them, it's their money. You may think they're too extravagant, but you don't (I hope) know how much they and their spouses make. It's nice to give them a financial boost, but it would also be nice to respect them as grown-ups.

By the way, I'd like to know what the "unnecessary (and dangerous) luxury" is.

Answer: Me, too - but imagination probably beats reality.

Comment: I recommend Option 5: Pay the student loans down/off. Michelle Singletary would approve!

Answer: It's such a good option that it's now Options 3 and 5. It's starting to sound like a Monty Python list. (There is no Option 6!)