Saturday, June 21, 2014

Generous Gift Offer Declined Due To Strings That Are Attached

Dear Tazi:

As a high school graduation gift – and in order to encourage her to make wise economical and educational decisions – I offered to pay for my granddaughter’s first two years of college if she chose to attend one of our state’s public colleges or universities, with the offer to pay the remaining two years if she stayed at the state school (or within the state system) and kept her grades high enough to attain placement on the Dean’s List each semester. This decision was not made lightly, but with the memory of sending my own daughter (her mother) and both of my sons off to school at fancy private colleges, and paying upwards of $20,000 apiece for it, only to see them return home after one year – for various reasons – and graduate from state colleges for less than the cost of one year at their original schools.

My granddaughter feels that my offer is not fair, and that I am trying to control her life. She has requested that I give her the money I would spend on her first two years tuition at a state school to apply to the tuition at a fancy private college that costs in the vicinity of $50,000 a year. This particular school is far from home (three to four hours by plane) and my granddaughter, in my opinion, still has some growing up to do before she is ready to be on her own in a new city. For all of these reasons mentioned, I denied her request. Because of this, I am apparently the worst Grandpa that has ever lived.

I am considering rescinding the offer of paying for her schooling, and giving her a graduation gift of similar value in the form of a 10-year government bond. Upon maturation it would be worth close to $100,000 and could be put towards the purchase of a house or other real estate. My one concern is that, without my tuition assistance, my headstrong granddaughter may skip college altogether – which I would hate to see happen – or sign her life away into a morass of student loan debt in order to attend her first-choice school – debt that would most certainly destroy the nest egg a bond would provide. I do not wish to make the same mistake with my granddaughter as I did with her mother (and her uncles), but at the same time I do not want to see my granddaughter rush headlong into a mistake of her own making. She is my only grandchild and my hope for the future of all that I have worked for in life. I would like an outside opinion, Tazi.

Signed,
Grandpa Jim

Dear Grandpa Jim:

You are a generous Grandpa, indeed! A college education is a priceless gift, and the offer you present to your granddaughter just challenging enough to make certain that she keeps her life on the right track. You strike a good balance between generosity (two years, no strings) and business (two years, Dean’s List). You are investing in your granddaughter’s future, so you should be allowed some say in how that investment is treated.

Your granddaughter, on the other hand, sees this offer as a gift – which is how you have presented it – and gifts should come with no strings attached. By putting conditions on your support, your granddaughter sees you as attempting to control her life. May I suggest a compromise of sorts?

Get your granddaughter something completely different for her high school graduation present. A pre-paid debit card to be used towards her first year’s textbooks is a generous gift (around the $1,000 range, depending on what she is studying) but nowhere near the level of major financial investment. Once the gift issue is off the table, you can sit down with your granddaughter and discuss all that you have mentioned to me in your letter. If possible, I would suggest having your daughter there, too; to moderate, should the conversation start to get heated.

Explain to your granddaughter that your original tuition offer still stands, no longer as a gift but as a business arrangement. As an investor, you have an offer to make her; and she, as the person seeking funding, can either accept or reject your terms – but not alter them in any way. Allow her some time to think things over before asking for her decision. If she decides to attend her first choice college, take comfort in the fact that she thought things through before jumping into the abyss of the unknown.

Allow your granddaughter the chance to make her own mistakes – she will never be able to grow otherwise. By the end of her freshman year, you may be surprised to find your granddaughter thriving at this far away school, and earning scholarships and academic accolades that will bring honor to both her and your family (and if this turns out to be the case, I am hoping you will be willing to consider your granddaughter’s counter-offer of a lump sum towards her tuition at this school). If your granddaughter discovers that her dream school has turned into a nightmare, resist the urge to say I told you so and please find it in your heart to re-present your generous offer.

Snuggles,
Tazi

P.S. My Mommie is in the market for a new Grandpa, since hers passed away several years ago! Care to adopt her? (Just kidding!) –T.K.



Ask Tazi! is ghostwritten by a human with a Bachelors of Arts in Communications. Tazi-Kat is not really a talking feline.

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