INDIANAPOLIS — Would you charge your kids interest if you loaned them money? A new survey suggests more parents are saying yes.
A study by MarketBeat.com found that some parents across the country are charging their adult children interest when they borrow money. Nationally, the average interest rate is 5.1 percent, while Indiana parents reported charging about 3.8 percent. That’s well below the national average of more than 11 percent for personal loans.
Some Indiana families say lending money is not part of their approach. Amanda McNeely, who has two children, ages 19 and 15, said she focuses on teaching the importance of saving instead.
“As a family, we have a budget for certain things,” McNeely said. “I think teaching them, ‘If you don’t have the money for something, you can’t get it,’ is a more important lesson versus just don’t get in debt. Let’s save and live within our means.”
The survey, which included nearly 3,000 people, found most respondents are only comfortable lending less than $100. Just 15 percent said they would consider lending $5,000 or more. The majority of respondents said they would want repayment within one to six months.
