How to Give the Grandkids Money Now, and Watch It Matter
August 29, 2026
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Show Notes
Eddie and Betty's Conversation
Welcome to The American Retirement Advisor. I'm Betty, and Eddie is here with me in the studio today, as always. Eddie, we're talking about something a little different from our usual financial mechanics conversation, and I think it's going to hit people right in the chest.
Good to be here. And yeah, when you sent me Ian Schaeffer's piece this week, I sat with it longer than I expected to. It's not a tax-strategy article. It's about something most of us feel but don't know how to say out loud.
Schaeffer's the COO at American Retirement Advisors, and he opened it with a story about a woman he calls Ruth. A grandmother who had money set aside specifically to help her granddaughter through nursing school, and she was just... sitting on it.
What stopped her wasn't the money. She had it ready. She just didn't want to overstep. The young woman was twenty-three, working nights, drowning in tuition, and Ruth was planning to hold that money for twenty more years so no one could accuse her of meddling.
So the granddaughter would be forty-three before seeing any of it. Nursing school would be long done. The debt would already be paid back, presumably with a lot of interest and a lot of stress.
And then Ian's father, who works directly with families on these decisions, asked Ruth one question. He asked whether she'd rather watch her granddaughter walk across that graduation stage with the loans paid, or have the granddaughter open an envelope after Ruth was gone and never get to see her face when she read it.
That question. I read it twice.
Ruth wrote the check that month. And that's the whole piece in miniature, really. The rest of it is about why we hold back and how to move through it.
So let's talk about why we hold back, because Ian Schaeffer is very clear that the fear is real and not silly. He's not dismissing it. He names two specific things that hold grandparents back, and I think most grandparents listening will recognize both of them immediately.
The first one is the fear of softening the grandkid. Handing a young person money they didn't earn and watching it make them soft, make them expect things. That's a genuine worry, and it comes from a good place. The grandparents who worry about that are usually the ones who worked hard for everything they have.
And the second one is the fear of overstepping. Of going around the parents. You've got your own adult child who is raising this grandchild, and suddenly grandma or grandpa is writing big checks without talking to anybody. That can feel like undermining someone's authority in their own home.
What Ian Schaeffer says about both of those fears is interesting. He calls them healthy. He says they are the instincts that make you the kind of grandparent worth listening to. He's not telling people to ignore the fear.
But there's a but coming.
The but is that when you just let those fears sit there unexamined, the default becomes doing nothing. And doing nothing is not neutral. He's very direct about that. Nothing means the help arrives decades late, at a funeral, when the tuition was paid on credit cards and the starter home was never bought.
That framing stopped me when I read it, because I think a lot of people assume that waiting is the safe, conservative choice. Like, you're not making a mistake if you just let it sit in the estate.
And there's a real cost to that assumption. It just doesn't show up on any statement. The credit card interest that accumulates over twenty years while the family sits on the estate is very real. The first house that never gets bought because the down payment help came too late is very real. The will arrives, but the moment where it could have actually changed the trajectory of someone's life has passed.
And then there's what Ian Schaeffer describes as the reframe. This is the part of the piece where he shifts from diagnosing the problem to actually giving people a different way to see the whole thing. He says a gift is not a transfer of money. It's a shared moment, and it belongs to three generations at once.
And what I like about that framing is it names who's actually in the room. The grandparent, the adult child in the middle, and the grandkid. And his point is that the middle generation, the adult child, is not an obstacle to route around. They're your partner in this.
Which is such a different way to think about it. Because I think a lot of grandparents, when they're trying to help a grandchild, kind of frame it as a transaction between themselves and the grandchild. They're trying to figure out how to give the money without making it weird.
And what Ian Schaeffer is saying is that the parents need to be in the room first. When the parents are standing next to you, part of the plan, the gift lands as a boost with meaning. When it drops in from above with no story attached, it lands as entitlement. That's a big distinction.
So walk me through how that actually works in practice, because the piece gets specific here in a way I appreciated. He gives people actual words to use.
That's the part I kept coming back to, because the barrier he's describing isn't financial, it's conversational. He says the grandparents he works with would give sooner if they just knew how to raise it without it landing wrong. So he gives a few openers. The first one is to the adult child, always first. Something like, I would love to help Emma with school while I'm around to see it, I don't want to step on how you two are raising her, so I want us to decide together how much, and how to frame it, so it helps her instead of softening her.
Notice what that does. It hands the parents the wheel. It doesn't ask permission exactly, but it makes the parent a co-author of the gift. That's going to land very differently than grandma calling the grandkid directly and saying, I'm going to pay your tuition.
Completely different. And then once the parents are on board, the language he suggests for the grandkid is just as deliberate. Something like, your mom and I talked, and I want to be part of getting you through this. Not because you are owed it, but because I believe in what you are building, and I would rather help now than have you wait.
That phrase, not because you are owed it. That's doing a lot of work. That's addressing the softening fear directly, right in the conversation.
It is. It names the thing that grandparents are afraid of, but instead of avoiding the conversation because of it, you put it on the table. You say out loud that this is not an entitlement. It's a belief in what this person is building.
And then there's a third piece of language he offers, which I think might be my favorite. For when you want the gift to carry weight. He says, this comes with one thing attached. I want to hear how it goes. Call me when the semester is done and tell me what you learned.
That one ties the gift to a relationship, not just a bank transfer. The grandparent isn't disappearing after the check clears. They're staying in it. They want to know what happened.
And from the grandkid's perspective, that's a different kind of accountability than a loan with interest. It's not financial pressure. It's relational. You're going to call your grandma at the end of the semester and tell her what you learned.
Which honestly most grandkids would probably love to do anyway. They just need to be invited into it. And what Ian Schaeffer is laying out is that the structure of how you give the gift shapes what the gift means. The same dollars handed over with those three conversations carry a completely different weight than a wire transfer with a note.
Okay, so now I want to get to the emotional center of this piece, because Ian Schaeffer spends real time on what he calls watching it land. And Ruth's story comes back here.
She was in the third row for her granddaughter's graduation. Got to see it happen. That's the payoff Schaeffer keeps coming back to. Not the check, the moment.
And he extends that to other examples. He writes about grandparents who helped with a down payment and then got invited to the housewarming. In the home they made possible. And he says every time, the giver got something back that doesn't show up on any statement.
They got to be there for the moment their money made. That's the line that really lands. You cannot be present for the reading of your own will. But you can absolutely be present for the graduation.
I think there's something a lot of people don't fully let themselves sit with, which is that the estate planning conversation, for all of its importance, is organized entirely around a moment the person never gets to experience. The will takes effect after you're gone. All the thought and care you put into it, you never see it work.
And that's not an argument against having a proper estate plan. You absolutely should have one. But it is an argument for recognizing that some of what you were planning to leave behind could do more good, and give you more joy, if it moves while you're still here.
Ian Schaeffer's phrase for that is a warm hand instead of a cold number. Which his father apparently uses when sitting with families through exactly these decisions.
A warm hand is the gift with the conversation behind it, the purpose, the relationship, the parents involved, the grandkid who knows why. A cold number is the line in a will that says here is what you get, unsigned by anything personal.
So here's what I keep thinking about as we talk through this. People listening right now who are grandparents, or getting close to being in that position, some of them have already done the estate planning work. They have a will, they know what's going to whom. But they haven't necessarily thought about whether any of that should be moving now, while they're around to see it.
And the question Ian Schaeffer is really asking is, what's the reason for waiting? Is there a real financial reason, like you genuinely need to hold those assets for your own security? That's completely valid and important. Or is the reason just the fear of meddling, the fear of softening someone? Because those fears are worth examining.
He's not saying give everything away now. He's saying look at the fear honestly and make sure it's actually guiding you somewhere good, not just keeping you frozen.
Right. The fear is trying to protect the family. Those are his words. Handled right, generosity protects it better.
Now, one thing that's practical but important. If someone is listening and thinking, okay, I want to do this, I want to help my grandkid with something specific this year, are there rules about how much you can give? Like, is there a tax piece here?
The IRS does have annual exclusion amounts and lifetime limits that shape how you structure it, and that's the kind of thing that really governs what you can do here. The article doesn't get into the specific numbers on that, and those details really matter and change over time. That's a question I'd write down and bring to one of the advisors at American Retirement Advisors, because getting that piece right is important.
Good point. The spirit of the conversation Ian Schaeffer is starting here is about the human piece, not the mechanics. But before anyone writes a check, make sure the structure around it is set up correctly.
What strikes me about that is how rare it actually is to lead with the human side before you get into the legal and financial setup. But both pieces have to be in place before anyone moves money around.
He also mentions something at the end of the piece called BeneficiaryBox. Can you talk about that?
It's a pretty practical little idea when you think about it. You want a simple place to record what you gave, to whom, and why, so the story travels with the gift. Because one of the things that can happen is that a generous act done now creates confusion later, especially when the estate eventually settles and people are trying to reconstruct what happened. Having a record of the gift and the reason for it keeps that clarity intact.
Think about what gets lost without it. You gave the money to a specific person, because you believed in what they were building. That deserves to be documented somewhere.
It also protects the gift itself. If years later there's any question about what was intended, there's a record. The gift was deliberate. It had a purpose. It wasn't random or impulsive.
What I find compelling about Ian Schaeffer's framing overall is that he's not separating the emotional side from the practical side. A lot of financial conversations try to strip out the feeling and just talk about the numbers. This one is saying the feeling is the whole point.
What he's really pointing out is that the dollars are not different. The money is the same whether it moves now or moves in a will. What's different is whether you are there. Whether you are in the third row.
That reframes what money is even for, at this point in life.
And it's not just about generosity. It's about what you want your own experience of this chapter to feel like. Do you want to be someone who watched your grandkid struggle from a comfortable distance because you were afraid of the conversation? Or do you want to be in the third row?
Let me ask you something, because I think this is the question a skeptical listener is sitting with right now. What about the grandparent who genuinely doesn't know if they can afford to give? Who is nervous about their own financial security in retirement?
Schaeffer draws a clear line there, and it matters. He's not saying everyone should give. The entire premise of this conversation assumes that the grandparent has resources. Ruth had the money set aside. The question wasn't whether she could cover it. The question was whether she was going to let fear keep her from using it while she was alive to see what it did.
So this is for people who have already done the planning, already have a degree of financial security, and are now looking at assets that they know are going to pass to the family eventually. The question Ian Schaeffer is raising is about the timing.
That image you painted earlier -- the opportunity that closes before the help ever arrives -- that one stays with me. That's the part that doesn't show up in any spreadsheet. Should some of what you planned to leave behind actually move while you're here? The piece argues there are real, human costs to waiting. The credit card debt from the tuition. The starter home that got bought later, at a higher price, with a higher rate, after the window had already closed. Those are real consequences of the default of doing nothing.
I also want to go back to something you said earlier, because I think it deserves more attention. The conversation with the adult child first. I think a lot of people would be tempted to skip that step. It's awkward to have money conversations with your own kids.
It is. And Ian Schaeffer is pretty clear that skipping it is a mistake. Not just because it's polite, but because it actually changes what the gift means. The gift that lands with the parents' blessing and participation is a boost with meaning. The gift that drops in from outside the family's normal structure, even with the best intentions, can feel like criticism. Like you don't trust the parents to provide.
Which is the opposite of what you were trying to do. You were trying to help, and it gets received as a judgment.
So you go to the parents first. You let them be part of how it's framed to the grandkid. You let them have input on the amount and the purpose. And then when the three generations are in it together, the gift carries a story instead of an awkwardness.
I want to pull out one more thing from the piece before we wrap up, which is the line about not handing the grandkid a number, but handing them a purpose. Because that's in Ian Schaeffer's own summary at the end of the article, and I think it's the line that's going to stick with people.
The number without a purpose is just money. The purpose gives the money a meaning that the grandkid carries forward even after it's spent. I believe in what you're building. That's what Ruth's granddaughter heard, whether or not those exact words were used. And that's what she was carrying when she walked across the stage.
She was right there in that gym, close enough to reach out and squeeze her granddaughter's hand the moment it was over.
You cannot attend your own will. That's not a small thing. That's worth sitting down and having a real conversation about what you actually want this chapter of your life to look like.
So where does someone even begin with that? If you're listening right now and thinking, okay, I want to do this, what's the first step?
Ian Schaeffer puts the conversation at the center of it. Have it while you can still watch it land. So the starting point is probably your own kitchen table, figuring out what you actually have, what you intended to leave, and whether any of that should be moving sooner. And then, before any money moves, sitting down with someone who understands both the human side and the financial and legal structure around gifts.
What Ruth's story really shows is that the rules governing how this works matter just as much as the intention behind it, and they're worth understanding before you act. The advisors at American Retirement Advisors do this work all the time, sitting with families through exactly the kinds of decisions Ian Schaeffer describes. If you're not sure where to start, or you want to know whether a conversation like Ruth's makes sense for your situation, that's the place to bring it.
The conversation is free to have. The clarity it gives you is worth a lot more than that.
There's also the practical documentation piece. Ian Schaeffer mentions that when you do give, having a record of what you gave, to whom, and why, keeps the story with the gift and prevents confusion down the road. That's worth building into the process from the beginning.
And that ties back to the broader estate plan. A gift made now should fit within the larger picture of what you're doing with your assets. An advisor can help you see how those pieces connect.
What I'll remember most from this piece is Ruth in the third row. That image. She almost missed it. She almost let fear keep her in a waiting room for twenty years while her granddaughter navigated nursing school on credit cards and night shifts. And instead she got to be there.
And the granddaughter got to know, in the moment that mattered, that somebody believed in what she was building. Not through a letter read at a funeral. In person.
If this conversation is one you've been putting off, whether it's with your adult child, your grandkid, or just with yourself, Ian Schaeffer's piece is worth reading slowly. And then pick up the phone and talk to someone who can help you think it through. The advisors at American Retirement Advisors can sit with you on this, at no cost to you for that initial conversation, and help you figure out what the right next step actually looks like for your family. We'll put a link in the show notes. Thank you so much for spending this time with us today.