Adult kids auto insurance

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LiveSimple
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Adult kids auto insurance

Post by LiveSimple » Wed May 15, 2019 3:32 pm

Hi folks,

Time has come that the adult kids will fly from the nest. What are the task as a parent we do need to do, financially.

Auto insurance, when can we remove them from our auto insurance. If you do not plan to drive and have no drive to get their own auto insurance, what to do.

Healthcare, assume when they start to work they will sign up for health insurance at work.

What else did you do or plan to do
Last edited by LiveSimple on Wed May 15, 2019 3:44 pm, edited 1 time in total.

Jack FFR1846
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Re: Adult kids auto insurance

Post by Jack FFR1846 » Wed May 15, 2019 3:37 pm

Auto insurance: You can drop them off your policy the minute they're no longer a member of your household.
Bogle: Smart Beta is stupid

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cheese_breath
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Re: Adult kids auto insurance

Post by cheese_breath » Wed May 15, 2019 3:41 pm

How anxious are you for them to leave? Would you like them to learn about the real world or continue partially supporting their 'independence'?
The surest way to know the future is when it becomes the past.

bloom2708
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Re: Adult kids auto insurance

Post by bloom2708 » Wed May 15, 2019 3:45 pm

I think you will know.

If your kid is in college, will graduate soon and have landed a job. That is the time.

I plan to work with my insurance agent to slide them off our plan and into their own plan. Maybe with renters insurance assuming they are renting.

When starting out, they have "liability only" cars. When they go on their own, we will determine if comp/collision make sense based on the value of their cars.

Health insurance is similar. Hopefully their job offers insurance. Once they do, then can come off our plan. It already partially happens at 18. Our insurance covers them, but they are on their own accounts. It kind of makes it a pain as you are not allowed to view/inquire on bills without permission.
"We are not here to agree with you; we are here to provoke thoughtfulness." Unknown Boglehead

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LiveSimple
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Re: Adult kids auto insurance

Post by LiveSimple » Wed May 15, 2019 3:46 pm

You May know, it is not easy to let them go alone and learn in the real world or continuously support them.

Planning a phased approach, but need to do ASAP so they learn.

Last week cancelled all the family credit cards once he said he is not using that and using his own credit card and paying off, as we do not see the bill, which was true.

Regattamom
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Re: Adult kids auto insurance

Post by Regattamom » Wed May 15, 2019 4:47 pm

When my oldest landed first job out of college a few years ago, we had a timeline of about six months to hand over everything to them.

They signed up for healthcare with employer.
Put cell phone in their name.
Put car in their name.
Had them get their own auto insurance.
And finally...Got them off our Netflix account.

Most importantly though, I helped them develop a budget and the understanding of how to use it. Also helped them understand the importance of investing in 401k through employer.

I am proud to say that dear child is saving approximately 50 percent of income, has no debt and will be purchasing a home soon.

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LiveSimple
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Re: Adult kids auto insurance

Post by LiveSimple » Wed May 15, 2019 5:28 pm

:moneybag
Regattamom wrote:
Wed May 15, 2019 4:47 pm

I am proud to say that dear child is saving approximately 50 percent of income, has no debt and will be purchasing a home soon.
Good to know

soccerrules
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Re: Adult kids auto insurance

Post by soccerrules » Wed May 15, 2019 5:46 pm

Here is what happened for us.....

We have launched one -- but really they jumped out with no push (graduated college, married 2 months later).

Child has an analytical math mind so they were all over the budget, getting married and accounted for car, Insurance,cell, rent,food, gas, utilities etc. I also provided a couple of Boglehead books to read before marriage. We allowed for child to stay on family health plan until they choose to go on own/spouses plan or hit 26. Child pays own out of pocket expenses for doctors visits,RX etc. Still sharing Netflix plan with them.(softy). They have no debt so they are a few steps ahead of other "kids" their ages.

2nd child is 12 months away for college grad. We shall see, but plan to do the same. If child comes home to stay and work-- child will pay Rent and something toward food that will go to the the Bank of Dad. (shhh, money will be saved in brokerage account for child or their own Roth). They will be required to max 401K and show they can LBYM to live at home.
Don't let your outflow exceed your income or your upkeep will be your downfall.

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LiveSimple
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Re: Adult kids auto insurance

Post by LiveSimple » Wed May 15, 2019 5:58 pm

soccerrules wrote:
Wed May 15, 2019 5:46 pm
child will pay Rent and something toward food that will go to the the Bank of Dad. (shhh, money will be saved in brokerage account for child or their own Roth). They will be required to max 401K and show they can LBYM to live at home.
Beatiful 👍

Leesbro63
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Re: Adult kids auto insurance

Post by Leesbro63 » Thu May 16, 2019 7:15 am

Here’s something to consider: there’s often a period of a few years where an adult child isn’t quite fully “launched”. Perhaps he/she has graduated and still lives at home. Perhaps they are still in undergrad or graduate school and are technically “independent”, but you still provide some support. And/or they may live away, but maintain legal residence in your home (the family home). During this period the, adult child might have his/her own car insurance, but it’s not crystal clear that they are truly independent. I’m of the thinking that the insurance should be with the same carrier and agent as the parent. And the exact relationship should be fully disclosed to the agent, perhaps by saved email. Yes this may require more coverage with higher premiums for the adult child. The parent should subsidize that, if need be. All because if the adult child’s liability could perhaps splatter onto the parents due to the “not fully launched” status. IMHO it’s enough of a risk to justify the extra cost and attention to detail that this requires. Also be sure that the parent’s “umbrella” insurance is part of this full disclosure setup. Probably the same carrier and certainly the same agent, with the entire arrangement having some sort of paper trail of disclosure.

Perhaps this seems like overdoing it, but young adults don’t always understand the importance of insurance and might not get or follow through with the right coverage on his/her own. And even if so, there could be holes in the coverage and the parent could be liable. Being the parent who “owns” this hopefully will reduce the chance of liability coverage holes for both the patents and the child. And also sends the adult child a message about the importance of risk management.

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