If you really want to help your adult kids and grandkids, give them money while you’re still alive

The idea of giving money to adult children and grandchildren while still alive is gaining traction, and for good reason. By doing so, individuals can see the impact of their generosity firsthand and make adjustments as needed. This approach, often referred to as "giving while living," can also help mitigate potential inheritance taxes and ensure that the money is used for its intended purpose.

However, it's crucial to strike a balance between supporting loved ones and securing one's own financial future. A key consideration is ensuring that gifting doesn't compromise the giver's retirement savings. Financial advisors often recommend that individuals prioritize their own financial stability before making large gifts. This might involve setting aside a dedicated fund for gifting, separate from retirement savings, or establishing a clear budget that accounts for both giving and personal expenses.

As the trend of "giving while living" continues to grow, it's essential to monitor how it affects the financial planning landscape. To watch next: how will financial institutions and wealth management firms adapt to this shift, and what new products or services might emerge to support individuals looking to gift while living? Additionally, will there be a corresponding increase in financial literacy and planning resources to help individuals navigate the complexities of gifting while ensuring their own financial security?

Originally reported by marketwatch.com. FundNews adds analysis for finance & markets readers.