Lynda Moore warns that love and money can get tangled up fast when you become a grandparent

Following on from the ‘we’re having a baby,’ conversation is the realisation that means we, (or I) are going to be a grandparent!!! There are potentially as many thoughts racing round in your head as the one is going to have the baby, and depending on whether it’s your first or tenth, those thoughts could range from excitement, to concern and everything else in between.

Just last week, I wrote about preparing your finances before a baby arrives, and now here I am, on the other side of that story, thinking about what it means for your money and your heart when it's your child having a child.

There's a particular kind of joy that comes with this news, and alongside it, a particular kind of temptation. You want to spoil this baby. The beautiful cot, the ridiculous number of tiny outfits, the toys they won't even notice for months. It's love looking for somewhere to land, and shopping is a very easy place to put it.

But I've also spent enough years sitting across the table from clients to know where that road can lead if you’re not careful.

The client who did it differently

A number of years ago, I worked with a family navigating exactly this. The grandparents wanted to shower their new grandchild with gifts, birthdays, Christmases, "just because" presents, all of it. The parents, sensibly, sat down with them and had an honest conversation. They agreed on a spending limit for physical presents, enough to feel generous and fun, without turning every occasion into an unpacking event nobody had time for.

Here's the part I loved. Whatever the grandparents had originally budgeted beyond that limit didn't just disappear. It went into an investment fund for the child instead. Years from now, that money will likely be worth far more than any pile of toys, and the grandchild will have something genuinely useful, a start on a first car, university costs, or a deposit one day.

What struck me most was that nobody felt like they were missing out. The grandparents still got to be generous. The parents didn't have to deal with a house overflowing with plastic. And the money kept working quietly in the background, doing something far more lasting than sitting in a toy box.

Love and money get tangled up fast

I understand the urge to overspend on grandchildren, because I understand where it comes from. It isn't really about the toys. It's about wanting to show up, wanting to matter, wanting this new little person to feel how much they're loved from the very beginning. Money becomes the language because it's fast and visible and satisfying in the moment.

The trouble is, that language can get expensive quickly, and it can quietly work against your own financial wellbeing if you're not paying attention. I've talked with grandparents who've dipped into retirement savings for extravagant gifts, or who feel obligated to match what another set of grandparents is doing. That's not generosity anymore, that's pressure dressed up as love.

Retirement is meant to be a chapter where your money finally works for you, not one where you're funding an unspoken competition. If becoming a grandparent puts your own financial security at risk, everyone loses in the long run, including the grandchild you're trying to spoil.

A different kind of generosity

What I liked about my client's approach is that it reframed generosity entirely. Instead of asking "how much can I spend on presents," the question became "what actually helps this child, and what feels good for me to give."

Sometimes those two answers are the same thing. Sometimes they're not. A capped gift budget paired with a fund that grows in the background lets you be present for birthdays and Christmases without needing every occasion to prove your love through a receipt.

It also opens up a great conversation to have early. Talk with your kids about what kind of grandparent role feels right for everyone, including financially. What are they comfortable with? What matters to you?

These conversations don't need to be formal; they can start over a cup of tea but having them before the baby arrives means nobody's improvising under pressure later. It’s also a good opportunity to talk about time as well.  If both parents are returning to work, do you want to and are you able to help with childcare?  What does that look like in terms of your life and activities?  Having the discussion and putting boundaries in place means you don’t end up being a full-time caregiver, unless that’s what you want of course, and missing out on your own life.

If this isn’t your first grandchild, how do you make sure you can be there for all of them?

Finding your own version

You probably don't know yet exactly what your version of this will look like. I suspect you’ll want to buy the ridiculous outfit at least once, because some urges are worth indulging occasionally, especially for a first grandchild. But I also like the idea of some of that love going somewhere quieter and more lasting, growing steadily while I get to enjoy the actual grandchild rather than the pile of gifts.

Because in the end, this isn't about being the grandparent who gives the most. It's about being the grandparent who shows up, who's present, and who's still financially secure enough to enjoy every bit of it.

That, I think, is the best gift any of us can give.

*Lynda Moore is a Money Mentalist coach and New Zealand’s only certified New Money Story® mentor. Lynda helps you understand why you do the things you do with your money, when we all know we should spend less than we earn. You can contact her here.