Kids and Money…we don’t like that combination, and let’s face it, no one wants to talk about the fact that adoption is expensive. Costs range from $25,000 - $50,000 or more, depending on if you’re pursuing a domestic or intercountry adoption.
Most don’t realize that there are so many aspects to the adoption process. The number of local and national organizations and most importantly all of the dedicated professionals that make it all happen.
Unfortunately, studies show that money is one of the biggest barriers when a family is choosing adoption. Some families just opt out, thinking there are few resources or it’s just not for them.
From the adoption professional’s perspective, many still struggle with this topic and how to address the money issue with prospective adoptive parents. Most agencies do not have the capacity to bring on a full-time or even part-time person to manage this role within their agency. But it’s important to understand that addressing the financial path of the adoption journey is key to any family considering building their family in this wonderful way.
1) DON’T Ignore the Topic – it’s easy to do! Families are frankly afraid to bring this up so it either comes out right away or they avoid the topic. There should be a checklist of “TO DO’s” during any PAP meeting and finances should be on this list!
Some agencies ask the family to complete a form. This is a good idea, but still avoids the perhaps difficult task of actually addressing the issue of money.
Families have concerns, they may feel embarrassed about their past – medically or financially. Best to bring it up and start the conversation.
2) DON’T Bulldoze in – on the other hand, sensitivity is key here. While it’s important to abide by DON’T #1, rushing in too soon, not listening for concerns or acting like it is no big deal, “they can get grants to cover it…” can set the family up for unrealistic expectations..
3) DON’T Mail them a Packet of Information. While we really got into the spirit of this during the pandemic, it’s better to have a staff member personally reach out via phone - or our favorite, ZOOM - to clarify the financial responsibilities of the adoption process.
Mailing an impersonal packet of information will likely not get the message across that the finances, along with all other aspects of the adoption process, are important.
4) DON’T think “This isn’t MY problem.” “We do the adoption, let them figure out the money.” Believe it or not, we’ve actually had adoption professionals tell us this!
We’re here to tell you that is most definitely YOUR problem. And if YOU don’t do it, someone else will!
Prospective Adoptive Parents are shopping, and they are looking for full-service agencies that support them in all aspects of the adoption journey.
5) DON’T Give them a List of Foundations. Again, the importance of this gets completely missed when it’s presented as just another list, just another piece of paper that they have to read. They are ‘overwhelmed,’ by the paperwork, politics, and finances of the whole thing!
The truth is that even considering grants at this early stage of the adoption process gets completely lost on PAPs. They should not even be considering grants until the home study, budget and story are done.
This is not an exhaustive list. We hope that by reading it you’ll come up with several more on your own!
1) DO Train Your Team – There is a lot of misinformation out there and we’ve heard it all! “The tax credit will pay you back for all your adoption expenses.” This is just not true!
“You can get grants to pay for your adoption in full.” Also, not true!
It’s critical to train your team to know the facts and present the correct information to PAP’s. We recommend an outline that is followed by the team members trained to do the presentations with PAPs.
Before a team member can do a presentation on their own, they need to be audited by a member of the team that knows the information.
2) DO Understand Money Cultures – What is a ‘money culture?’ It’s defined as the social rules about money in American Culture.
Money cultures can be handed down from parents to their kids creating an unhealthy cycle of money habits. Some examples are “Pull yourself up by your bootstraps, “ or “Money doesn’t grow on trees.”
Understanding that we ALL have these and how they influence how we approach certain life challenges is crucial: such as getting married, buying a house and yep – building your family.
The key is to “listen” for the culture and understand it as you work with various families to better understand their approach to money and what expectations they may or may not have about grants, fundraising, loans, etc.
3) DO Innovate – Find ways to differentiate your services. This could mean a partnership with a local financial planner or bank. Find ways to address the finances that are creative.
It could also mean partnering with Your Adoption Finance Coach (YAFC)! YAFC is a very affordable way to offer financial services from a team that has been there and experienced adoption first-hand.
For as little as $75 per family, we can help PAPs with budgeting, loans, grants and fundraising. Check out our partnering agencies.
4) DO Align the Financial Path with the Adoption Path – Some agencies will just give a laundry list of expenses with little information about when the expenses occur. Others will give a wide range of the cost of items (such as $10,000 - $20,000).
We recognize that it’s very difficult to nail down some expenses; however, taking the time to give as many details as possible, along with timing, is a critical aspect of managing the process.
5) DO Listen and Lead – Families can be afraid. Many are afraid that you will tell them they cannot adopt, or afraid that you will tell them they cannot afford adoption, or afraid that they won’t ever find a child that matches their needs.
There are many families seeking to build their family through adoption who have also been through a lot of pain and spent a lot of money – sometimes all the money they have.
Listening to their financial concerns and guiding them through the process will give them confidence and help them finish the goal and bring their family together forever.
Your Adoption Finance Coach has served over 6,000 families across the country and has partnered with over 100 adoption agencies and attorneys. Families that utilize our innovative system raise between $10,000 - $25,000, depending on their circumstances.
Our goal when we work with a family is that they will reach their full financial commitment to finalize their adoption – whether it is via a loan, fundraising, grants, tax credit or all of the above!
Everyone who works at YAFC have all been touched by the adoption triad and passionate about helping families through adoption. For more information, or to schedule a free demo of our services, contact us at firstname.lastname@example.org or at 816.268.5500.
For those considering domestic or international adoption, if you’ve done any amount of research on the subject, you’ve likely begun to understand that the cost can be steep!
Depending on whether you’re seeking a domestic or intercountry adoption journey, you will want to prepare to dig deep…real deep into your pockets because for most adoptions, costs can range from $25,000 - $50,000. In some cases, for intercountry adoption, costs can be even more depending on how many trips or long-term stays are required.
It’s no surprise to learn that the #1 barrier to adoption is the high cost! Most folks don’t even consider adoption as a viable path simply because the costs are so daunting, and they can’t see a clear path for how they’ll fund the adoption journey.
Your Adoption Finance Coach was created specifically to solve the money problem as it relates to adoption. There are many options and resources to finance an adoption but certainly the ‘one-size-fits-all’ approach will not work.
Every family’s financial situation is different. In this article we will address loans and grants that are available and how a family can determine if they qualify.
The first option most families hope for is to receive a grant for their adoption. There are many foundations such as A Gift of Adoption, A Child Waits Foundation, HelpUsAdopt and Show Hope that provide grants to families. This is just a sample of some of the more popular foundations.
Most are faith-based, however there are some organizations that do not require you identify as Christian. While foundations are deeply devoted to helping families with the expenses, most are interested in how they can bridge the funding gap of adoption.
Foundations expect the family to contribute a good portion of the costs and being able to articulate how they will pay for their journey. In other words, a family can’t just say, “We want a grant for $40,000!” That is unrealistic!
Most grants range from $1,000 - $5,000. Some may give more depending on the circumstances of the adoption. For example, some foundations will be interested in the child and the birth mom circumstances – drugs? Homeless? Keeping the child out of foster care.
Others will be more interested in the adoptive parents’ journey. For example, infertility, a failed adoption attempt, etc. But in all cases the story, your compelling reason why you are adopting, is key to receiving a grant award.
Do not send any applications without these documents included.
Something you CAN do before the home study is complete is to obtain a loan to fund your adoption either partially or in full. This requires a budgeting analysis of exactly how much money you will need. Be sure to consider any travel expenses or personal expenses such as time off work that might impact your budget.
For domestic adoptive families, obtaining a loan before you’re networking for a birth mom is important for you to be able to accept a situation that might be presented to you. This can be a line of credit or a home equity loan.
Always check with your home bank first for the best interest rates, but there are others such as America’s Christian Credit Union that provide an adoption line of credit. Other credit unions are jumping on this train – Vystar and Firefly Credit Union.
A home-equity loan is always an option but be aware that there are typically fees such as closing costs and the appraisal of the property.
We get lots of questions about zero-interest loans and while these can be compelling, they do require a home study and have limited funds available. Some even expect repayment right away tying up your cash flow. Be certain that if you go with a no-interest loan, you understand what you are getting. Some no-interest loans are from Lifesong for Orphans, Pathways to Little Feet and Abba Fund. A Child Waits Foundation can give a low-interest loan along with a grant.
The process of adoption can be overwhelming! We say paperwork, politics, and finances! It is a highly emotional experience; many find themselves on the path of adoption after the expense and trauma of infertility or loss.
Many families arrive on the adoption path and once again find themselves dealing with so much -- Where to begin? What to do first? Where will we get the money?
1) Start with a complete budget – Include all your own personal expenses along with what your agency or professional have given you. Consider everything, leave nothing out. You want a number and the right number to start with.
2) Visit a tax advisor - Learn how the tax credit will benefit you. Many do this last however, we recommend scheduling this important visit first, so you know how it benefits you and at what level.
3) Consider what you already have – Savings, family gifts, and the amount you can put away each month toward your adoption.
4) Craft your story – Make it unique like you. Why are you adopting? Give it your heart.
5) Develop a plan – Month-to-month just like a household budget. What is coming in? What is going out?
6) Determine what you need - Then consider how you will get it. We’ve covered loans and grants but there is also fundraising, special events and family gifts.
7) Implement your plan - Stick with it, update often and change it according to what is happening. This is your ‘business plan for adoption’. It is a living document that helps you achieve your goal of bringing your family together forever.
So, you’ve decided to build your family through adoption, Congratulations! This article is written with you in mind. It may seem like the biggest task you have ever taken on, but the rewards far out-weigh the costs!
For those that feel like it takes forever, and the path is circuitous, just hold on to that dream. When you are united with your child, holding them in your arms for the first time, it’s that moment when all the work and fortitude it took to get there fades away and you are together forever!
It is possible to get all the money you need for your adoption; however, there are some misconceptions about exactly how to make this happen. Many families get the idea that they can get all grants or do one fundraising event to cover all the costs of their adoption. These misconceptions get perpetuated through social media and other channels, but it simply is not true.
Have there been instances where a family has received lots of money for their adoption through grants and fundraising? Of course, but these are the exceptions not the rule! It is important when you are starting out on your adoption journey that you are realistic about the finances you will need.
We recommend a diverse approach when putting together a financial plan for your adoption. The Adoption Finance Coaching system is designed to take families through a budgeting and timing process that will uncover all the expenses for your journey. Our Coaches understand that there is no ‘one-size-fits-all,’ we help you create a comprehensive, customized financial plan for your journey.
Yes, you need to contribute to your adoption with your own money. Foundations expect this and it’s important to set aside money for your adoption each month.
We recommend reviewing your own personal budget and identify an amount of funds you can contribute monthly. It doesn’t matter how much; it matters that you are committed to this amount, and you do it!
Set up a separate account for your adoption where you’ll put all the money for your adoption. This helps you track expenses and your progress.
Likely you will have family members that will want to help…Let them! Include them in your plan, let them know what your plan is and exactly what you need and how they can help.
For funds received by family and friends, you can receive up to $14,000 in cash gifts without claiming that money on your taxes. That is per person, per year! Gifts are cash and cannot be tax deductible. Always check with your tax advisor or professional about any tax decisions you make. We are not tax advisors.
Loans are typically one of the first steps considered when you are putting together your plan. Why? Because in most cases a family wants to secure whatever money they can so the process can move forward.
Start with your home bank. Where do you have a banking relationship? You have a better chance at refinancing your current mortgage or taking out a home equity loan with the bank that has the existing mortgage.
Research other lenders. Credit Union’s such as America’s Christian Credit Union are offering adoption lines of credit that can be a useful option. Other Credit Unions are Firefly Credit Union, Vystar and perhaps more. If you’re a member of a credit union, we encourage you to research this option.
Zero-interest lenders. There are a few lenders who are in the nonprofit sector who provide loans with no interest. One of the most popular is Pathways For Little Feet. They offer loans of up to $7,500. They consider credit score, income, and financial need.
Others are Lifesong for Orphans and Abba Fund. They are all religious organizations. Some may or may not have any faith requirements or statements that are needed for loan approval.
Consider a combination of a grant and loan. An excellent example of this is A Child Waits. They provide grants to adoptive families and can also give a low interest loan in addition to a grant.
They have no deadlines for submission, nor do they have any religious affiliation. They do require a co-signer. Loans and grants or a combination cannot exceed $10,000.
Popular foundations include HelpUSAdopt, Lifesong for Orphans, Gift of Adoption and Show Hope. Each foundation has their own guidelines and restrictions that must be followed when applying.
A simple internet search will provide a full list of foundations providing grants to families. Families can waste valuable time hunting for grants on the internet without the proper guidance. Our coaches can help families connect to the right foundation to get the best results.
Be sure to read the web site and information before applying. We do not recommend applying to ALL foundations. It is a waste of your time and theirs as you will not qualify for all of them, and you are taking valuable resources from a family that might qualify.
Fundraising is not for everyone! If you are not the type of person that enjoys planning, details and events, then it’s likely not going to be your thing!
Many families have had a great deal of success with fundraising for their adoption. But they will tell you themselves it’s time consuming and requires attention to detail and planning ahead.
Social media platforms come to mind when we talk about ‘other.’ Social media platforms such as GoFundMe, Facebook, Adopttogether.org are all viable options when fundraising. The key to remember about these valuable tools is that they are tools, not events.
They should be used in combination of something else you are planning. If you just plan to do a GoFundme page, then you’ll have to make a plan. Just like your fundraising plan, you will need to plan for how you’ll post, what you’ll post, writing your compelling story, who you will share it with, how many times and most important - how you will drive traffic and interest to your page over time. These platforms can be very successful; but can be the most beneficial when used as a part of an overall fundraising plan for your adoption.
Finally, we consider it a privilege and honor to have the opportunity to work with so many clients to help them build their family through adoption. There is no greater way to bring a community together than through adoption. We encourage you to invite your community in!
Family and friends and others in your community want to be a part of this extraordinary experience. Whether they give money, time or talent, you will be amazed at the generosity of others when you invite them in. Our best advice – LET THEM!
Call it the eighth wonder of the adoption world, the Adoption Tax Credit has helped thousands of adoptive families recoup the costs of their adoption. Unfortunately, many families don’t take full advantage of this credit. This can be due to a lack of understanding or direction from their own tax professional or worse they don’t even bother to take the credit once their adoption is complete.
The Adoption Tax Credit is just as it says, a ‘credit’, meaning that you receive back only what you have paid in tax liability. The credit was refundable for a short period in 2010 and 2011 and then returned to its credit status in 2012. The credit is claimed one time for each child. There are many organizations, advocates and politicians who support the tax credit and who continue to rally for it to one day be refundable…then it really will be the eighth wonder of the world!
But for now, it is what it is and the Adoption Tax Credit for Adoptions complete in 2020 is $14,300.00. This amount changes each year.
Bottomline, this is an important factor when considering adoption. While there is no silver-bullet, no one ‘thing’ is going to pay for all of your adoption, there are many ways to develop a plan for how you’ll come up with all the money you’ll need to bring your family together forever. In the meantime, some excellent resources are listed below for how you can learn more about this credit.
Oh, and by the way, advocate, advocate, advocate…. even though the tax credit is permanent, it still needs to be refundable. Pick up the phone and call your representative to let them know how important changing the credit to a refund is to the future of so many families.
North American Council on Adoptable Children www.nacac.org
Bill’s Tax Service – http://centralia-il-taxservice.com
IRS - http://www.irs.gov/Credits-&-Deductions/Individuals/Adoption-Credit
Adoption Tax Credit – www.adoptiontaxcredit.org
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