Last Updated: May 21, 2024
These parents contribute 2X more to their adult children monthly than their own retirement accounts.
Our third annual review of parental patronage reveals that the trend of parents financially supporting their grown children may be here to stay. Many are still spending heavily on their kids, even at the risk of straining themselves financially as they approach retirement or live on fixed incomes.
Here are a few other standout findings from our latest study of 1,000 parents of adult children:
- 47% of parents with grown children provide them with some form of financial support (not including adult children with disabilities). This is a similar rate to last year’s report.
- On average, parents providing financial support give $1,384 to their children monthly. That’s more than twice what the average working parent in our study contributed to their own retirement savings monthly ($609 on average).
- 61% of adult children living with their parents don’t contribute to any household expenses, including rent.
- 46% of parents who financially support adult children give them money for vacations and discretionary spending, and 18% help their adult kids pay off credit cards.
- 58% of parents agree they have sacrificed their own financial security for the sake of their adult children. Last year, only 37% of parents said the same.
- Though most parents attach some strings to the help they give their adult kids, 29% of parents do so without any conditions.
>> Side note: See the latest coupons and deals from financial services such as QuickBooks, LegalZoom, and Nolo.
How many parents are still shelling out for grown-up kids?
This year, 47 percent of parents provided financial support to at least one adult child. Of the children who live with their parents, 61 percent don’t even chip in for household expenses or rent.
*Not including those with disabilities
Despite a general improvement in the economy in recent months, the practice of parents financially supporting their adult children has not decreased since our previous study. This may indicate that the economic recovery, evidenced by high employment, falling inflation, and economic growth, hasn’t reached young Americans unwilling or unable to wean themselves off their parents’ help.
The most common generation of young adults to receive parental help was Generation Z (ages 18-27), the youngest adult generation. The median age for adult children receiving financial help was twenty-two. Among parents surveyed, the median age by which they thought kids should be fully financially independent was age 25. Despite that opinion, many are still supporting children well over this age. Of parents providing support, 21 percent were helping Millennial (age 28-43) or Generation X (age 44-59) kids.
Leaving the nest versus growing the nest egg
Excluding children with disabilities, parents who helped their kids financially provided them with monthly aid of $1,384, on average. Parents generally contributed more significant sums to their Gen Z kids than millennials or Gen Xers, since that younger generation is more likely to be in university or at an earlier stage in their careers.
| Age of adult children* receiving support | Average monthly contribution among parents who give financial support |
|---|---|
| Generation Zers (18-27) | $1,515 |
| Millennials (28-43) | $907 |
| Generation Xers (44-59) | $960 |
| All 18+ | $1,384 |
*Not including those with disabilities
$1,384 per month, or nearly $17,000 per year, is no small sum. This is money that parents could be spending on their own expenses, vacations, and contributing to retirement. In fact, it appears that helping their kids is visibly harming their retirement savings. Non-retired parents still in the workforce contributed even more to their adult children, at an average of $1,476 monthly.
Monthly retirement contributions for non-retired parents supporting adult children is $609 on average, less than half of what they spend on helping their adult kids. Considering that sobering figure, it’s no surprise that parents who support their adult kids are more stressed about retirement.
What exactly are parents paying for?
So how exactly are parents financially supporting their grown children? Each situation is unique, but the most common costs that parents cover include groceries, rent, and cell phones. Parents helping their Gen Z adult kids tended to pay three of their bills each month, while Millennial children received one fully paid bill, courtesy of Mom or Dad.
| Category | Parents supporting adult Gen Z kids | Parents supporting Millennial kids | All parents supporting adult kids | Average monthly support provided |
|---|---|---|---|---|
| Groceries or food | 81% | 65% | 77% | $175 |
| Cell phone | 70% | 42% | 64% | $60 |
| Rent or mortgage | 60% | 53% | 58% | $713 |
| Health insurance or healthcare | 67% | 19% | 56% | $151 |
| Tuition or other school expenses | 56% | 25% | 49% | $636 |
| Leisure/vacations | 53% | 25% | 46% | $168 |
| Discretionary spending | 48% | 37% | 46% | $108 |
| Car | 48% | 27% | 43% | $199 |
| Student loans | 26% | 19% | 24% | $327 |
| Credit cards | 19% | 14% | 18% | $201 |
| Investments | 13% | 10% | 12% | $605 |
Note: Excludes parents supporting disabled adult children
Since Gen Zers are younger, they tended to get more help cross a wider range of expenses, such as with tuition or other school-related costs. Another major generational difference is related to healthcare. Of those whose parents help them, two-thirds of Gen Z adults get help with health insurance or other costs, compared to just 20 percent of Millennials. This is likely due to many young adults being allowed to stay on their parents’ health insurance policies until age 26.
Parents were also helping their grown-up kids with various non-essential expenses, such as leisure activities, vacations, and even discretionary spending. Nearly a quarter of all parents who provide monetary support to their adult children helped out with student loan payments, and 18 percent helped pay down credit cards.
Laid off and still covering costs
Parents who support their adult children, as well as the adult children themselves, have not been immune to the negative effects of economic shake-ups that have led to increased layoffs in recent months.
More than half of parents whose child has been laid off in the past 12 months have increased their financial support to help cushion the blow. Those adults are lucky to have their parents, but who do the parents have? Parents get laid off too, and among those we surveyed, about half of parents who were laid off themselves in the past year continue to provide the same level of financial support to their adult children.
Parents are sacrificing their own financial futures for the sake of their adult children
In our 2023 study, 37 percent of the parents we surveyed agreed that they had sacrificed their own financial security to help their adult children. This year, that number has surged to 58 percent.
One possible explanation for the increased number of parents who feel they’ve sacrificed themselves financially is the significant inflation we have seen since 2021. Rising prices make it more expensive for parents to pay both their own bills and their kids’ bills. In retirement, many older Americans live on fixed incomes, which can create a greater sense of stress and sacrifice when it comes to helping their kids.
It is no wonder that parents are feeling the pinch. Considering the median child-helping parent makes between $50,000 and $75,000 per year, the average assistance of $1,384 monthly would comprise up to a third of their total income!
| Which of these would you be willing to do to support your adult child(ren)? Select all that apply. | 2023 | 2024 |
|---|---|---|
| Live a more frugal lifestyle | 58% | 61% |
| Pull money from my savings or retirement account | 44% | 46% |
| Retire later | 33% | 37% |
| Take on debt | 25% | 29% |
| Come out of retirement | 16% | 18% |
| Refinance my home | 10% | 12% |
| None of the above | 19% | 14% |
Americans who help their kids are willing to give up a lot to keep helping. Over 60 percent of these parents are willing to live more frugally, and nearly half are willing to pull money from savings or a retirement account. Though they spend roughly twice as much on helping their adult kids as they contribute to retirement, less than 40 percent say they are willing to retire later to keep helping.
For parents who help their adult children, they seem to draw the line at debt and refinancing loans. Less than 30 percent were willing to take on debt to help their adult kids, and only 12 percent would refinance their homes to help. Less than 20 percent would come out of retirement to help them. Baby Boomers were least likely to give up any of the tradeoffs listed.
Should parents place conditions on their financial support?
For many parents, it is a joy to help their children at any age if they can do so. But, according to the parents in our study, only about a third think their support will help their adult child transition to financial independence.
| Do you set specific conditions that your adult children must meet to receive financial support? Please select all that apply. | Percent of parents financially supporting adult kids |
|---|---|
| Maintaining a job or actively seeking employment (e.g., must prove they are applying to jobs if unemployed) | 45% |
| Pursuing education (e.g., must be enrolled in college, university, or vocational training) | 42% |
| Contributing to household expenses (if living at home, e.g., must pay a portion of rent or utility bills) | 18% |
| Achieving certain financial behaviors or goals (e.g., must follow a budget or save a certain amount each month) | 17% |
| Attending counseling or therapy (if support is related to personal development or health issues) | 4% |
| None - I provide support with no specific conditions | 29% |
Without the proper boundaries in place, monetary help can evolve into damaged relationships and missed financial milestones. American parents are torn about how to move forward, though most still tie their assistance to some condition on the part of the child.
Nearly 30 percent of parents who help their kids do so with no strings attached. Most parents who include some condition either attach financial help with keeping a job or staying in school. These likely provide parents with a reasonable assurance that their child is moving forward, ideally toward a more secure future. Having clear conditions on financial support can also provide motivation and accountability for adult children.
Conclusion
There is a clear challenge in the economy today. Driven by a convoluted mix of socioeconomic factors, adults receive help from their parents well into their twenties, thirties, and beyond.
For some, it’s tempting to simply say that today’s young adults are just mooches and that a strong foot in the rear will launch them into normal, independent adulthood. That may be gratifying for parents who are tired of footing the bill, but it doesn’t solve or even properly describe the economic factors at play, such as rising housing costs.
The economic forces working against Americans of all ages may be greater than any one family can solve. The country will have to contend with a changing labor market and rising prices so that American parents can plan for retirement without stressing how their children will make ends meet.
Our data
We surveyed about 1,000 U.S. parents of adult children on whether they pay some of their children’s bills or provide other financial support. Our survey was conducted online in February 2024. Participants were 50 percent men and 50 percent women. The median age among respondents was 56, and the median income was between $50,000 and $74,999 annually.
Our data distinguishes between adult children with disabilities, which may make it more difficult for them to live independently, and adult children without disabilities. Our analysis focused on parents who contribute financially to their adult children who don’t have disabilities.