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Nearly half of all parents still financially support their grown children

Nearly half of parents still financially support their grown children
Posted at 2:21 PM, Mar 24, 2023

The legal obligations of parenthood usually end when a child turns 18, but in these tough economic times, that appears to be changing.

A new survey conducted in February shows that nearly half of all parents are still financially supporting their children, well after they've left the nest.

Savings.com surveyed 1,000 parents and found 45% with at least one grown child provided them with an average of $1,400 per month.

That includes money for things like groceries, cell phones, rent, and student loan debt. But 43% of parents also paid for their children's vacations, and about 4 in 10 paid for their car.

It's a trend that appears to have emerged in the early days of the pandemic when many college students and young adults moved back home due to remote learning or job loss.   

Pew analysis found about 6 in 10 people aged 18 to 24 resided with one or both of their parents in February 2020. That same age group accounted for 65% of those still relying on mom and dad for money.

Surprisingly, nearly 20% of adults receiving financial support from their parents were over 30 years old.

Parents planning to retire in the next 10 years provided the most to their kids — about $2,100 per month — while contributing just $643 into their monthly retirement accounts. 

Additionally, less than half of adults who lived at home on their parents' dime contributed to household expenses. Those who did chip in about $186 per month.

Many parents  feel obligated to provide for their kids even after they've grown up, but it can still raise concerns about their own financial future.  

SEE MORE: Millennials aren't saving as much compared to Gen X, baby boomers

If it means helping their kids, 44% of parents said they're willing to pull money from their savings or retirement accounts, while 33% are okay with pushing back retirement altogether.  Additionally, about a quarter said they'd take on debt for their children and 1 in 10  would even consider refinancing their home. 

It shows parents are willing to go to great lengths to make sure their kids don't have to worry about money. But what's the real cost?

Over half of those providing for their adult children reported being "somewhat stressed" about living comfortably when they retire, while 23% said they were "very stressed." 

Most parents surveyed said they don't intend to pay their children's bills forever, with only 19% saying they'll never withdraw financial support. But that monthly allowance could generate thousands of dollars for retirement if it were invested into a Roth IRA account instead.

Parenthood clearly comes with great financial responsibilities that don't always end when the children turn 18; and while research shows a growing generosity among parents, it doesn't always hurt to put themselves first from time to time.