By Hal M. Bundrick
NEW YORK (MainStreet) Your retirement savings is dwindling, but family members think of you as "the family bank." You're easy to approach in times of need, happy to help and always willing to put family first. There's just one problem: your family generosity exceeds your financial capacity.
Nearly three out of five (62%) Americans age 50 and older have provided financial assistance to family members during the past five years of economic stress, according to a new Merrill Lynch study. Handing over an average of $15,000, without expecting anything in return, many family benefactors (88%) aren't taking into account how their kindness is impacting their own retirement readiness.
Well more than half (56%) of those 50 and over surveyed believe a member of their family is the "family bank" -- someone to turn to for financial help. This person is often perceived as being the most financially responsible, having the most money, or simply as being the easiest to approach.
Half of these same pre-retirees say they would retire later (60%), return to work after retirement (40%) or face a less comfortable retirement lifestyle (36%) in order to offer family financial assistance, simply because "it is the right thing to do."
"Families are a major source of fulfillment during retirement years but can also create unforeseen financial pressures," said Ken Dychtwald, Ph.D., founder and CEO of Age Wave, a partner in the research. "Too often, people plan for their retirement without factoring in how they might be called upon to help out their adult children, aging parents and siblings. In this new era of extended longevity and increased family interdependencies, retirement planning is no longer about just an individual or couple, but also about the needs and hopes of our loved ones."