‘How bad of an idea is it?’: Man wants to ‘gift’ his 18-year-old son his childhood home but is worried it’s a bad move. Dave Ramsey responds

Moneywise
‘How bad of an idea is it?’: Man wants to ‘gift’ his 18-year-old son his childhood home but is worried it’s a bad move. Dave Ramsey responds
‘How bad of an idea is it?’: Man wants to ‘gift’ his 18-year-old son his childhood home but is worried it’s a bad move. Dave Ramsey responds

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American baby boomers are expected to pass on an astronomical $84 trillion in inheritances to their heirs over the next 20 years in what’s being dubbed “the great wealth transfer.”

However, offering monetary gifts to adult kids can be tricky. On the one hand, many parents likely want to do everything they can to provide their kids an advantage in this inhospitable economy. On the flip side, some may worry whether their kids are ready for such a sudden influx of wealth.

A caller on The Ramsey Show was grappling with this exact dilemma. He told personal finance guru Dave Ramsey that he wanted to “gift” his childhood home to his 18-year-old son — but he wasn’t sure if it was a “bad idea.” Ramsey was surprisingly open to the idea, albeit with a few caveats.

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Preparing your adult kids for the great wealth transfer

“Yeah I’d give it to him,” Ramsey confirmed after listening to the caller speak highly of his son. “But I’d put some terms on it,” he added, suggesting that the caller’s son should have solid plans for his life beyond owning a home.

In the U.S., 65% of parents admitted to providing some sort of financial assistance to their adult kids between the ages of 22 and 40, according to a USA Today study.

The great wealth transfer is a situation that experts say could reset a historic divide when it comes to personal finance and homeownership for younger generations. Those who receive an early inheritance passed down by their parents during their lifetime — like the caller’s son — are some of the first beneficiaries of this transfer. It’s expected to make millennials the richest generation in American history.

If you are among the lucky inheritors of generational wealth in the form of a gifted home, Ramsey recommends that you consider any maintenance or renovations the property may need in the future — and to set aside money for that.

With CD Valet – an online CD marketplace – you can save for unexpected expenses with better rates than the average savings account. Shop and compare top certificate of deposit rates from banks and credit unions nationwide with CD Valet’s extensive database that shows the most competitive rates without bias.

With daily rate updates and earnings calculators, their array of free tools can help you find the right CD to pad your home repair savings budget.

Read more: Don’t leave your family unprotected — find life insurance coverage up to $2 million with no medical exam or blood test

If you’re looking to grow your savings even more, Advisor.com offers a more convenient way to find and connect with qualified advisors who can help you plan for a wealth transfer from your parents, including inheriting a home.

With some basic info about your wealth goals, time horizons and risk tolerance, Advisor.com will connect you to a broad network of wealth professionals who specialize in financial planning, investment management, and tax advice.

If you’re not expecting to inherit a home, there are other ways to take advantage of the hot real estate market without having to buy a house or make an enormous down payment.

Backed by world-class investors like Jeff Bezos, Arrived is an online platform where you can invest in shares of rental homes and vacation rentals without taking on the responsibilities of property management.

Arrived makes it easy to fit rental properties into your investment portfolio, regardless of your income. Their flexible investment amounts and simplified process allows both accredited and non-accredited investors to take advantage of this inflation-hedging asset class.

Browse through their curated selection of homes, each vetted for their appreciation and income potential. Once you find a property you like, you can choose the number of shares you want to buy and start investing with as little as $100.

While some platforms have democratized real estate investing by lowering entry barriers, those seeking larger-scale, institutional-quality commercial property investments often require a different approach.

For accredited investors with a higher risk tolerance and investment horizon, there are ways you can tap into the potentially higher returns of commercial real estate.

First National Realty Partners (FNRP) focuses on properties leased by industry-leading tenants such as Whole Foods, CVS, Kroger, and Walmart.

FNRP offers investors the opportunity to own a piece of essential retail infrastructure, with an experienced team that oversees every facet of the investment process, from property acquisition to leasing and property management.

Leveraging proprietary technology and a deep understanding of the market, FNRP has the potential to deliver exceptional returns while maintaining the highest standards of investment performance.

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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

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