If you have a kid in college, you know the call: “Hi Mom! I’m doing fine (long pause)…but I’m a bit short this week, can you send money?” Well, here is some bad news: those calls are not ending when the kid graduates. Nope, according to ABC News (that’s the Australian Broadcasting Company…we bohemians get our news from a wide array of global sources), boomers are going to be playing banker for the next generation, particularly when it comes to helping kids buy that first home. Banking analyst Martin North provides our quote of the week:
One of the trends we’re now seeing is the baby boomer generation – who have the equity in the properties and all of the assets – are actually now using some of that to effectively kick-start the next generation, so they’re actually giving or lending at low rates to their offspring…We tend to live with the great delusion that one of these days it might even be paid back, but we don’t hold our breath.
Remember that adage, “I hope I live long enough to be a burden to my children?” Don’t hold your breath on that one either.