At least half of all American parents are still extending financial support to their adult children. In a recent Savings.com survey, one in two American parents provides some financial support to their children over 18 years of age. In addition, these parents usually shelled out more during the pandemic.
Savings.com Survey: 50% of American Parents Still Financially Support Their Adult Children
Savings.com conducted a survey last February involving 997 American parents with at least one adult-age child.
It found out that half of the American parents still continue to provide some form of financial assistance to their children.
This can come in the form of buying food or paying for a monthly plan. In some cases, this can also mean paying for health or auto insurance.
On average, these parents provide their adult-age kids around $1,000 a month to help defray their expenses. What’s more, many adults turned to their parents for help in financial matters.
This is on top of the usual financial hurdles young adults face. An uneven job market, pending student loan bills, and increasing housing costs.
The Rise of Boomerang Kids
The pandemic also led to a rise in what economists call the “boomerang kids”. These are adults who returned home to live with their parents.
In 2020, the number of boomerang kids rose to a historic high. However, 62% of those adult children do not contribute to the payment of household expenses. For those who contribute, they shell out an average of $368 a month to help with the expenses.
With COVID-19 waning, a new challenge approaches American parents whose adult children still depend on them. Soaring inflation is threatening to erode whatever purchasing power they have.
Add the burden of financially supporting adult offspring, some Americans may experience further strains on their budgets.
How Long Should Parents Support Their Adult Children?
For 51% of the surveyed parents, they said that they have no responsibility in providing financial help to their fully grown offspring.
However, those with higher income felt like it was their duty to help. In contrast, only 26% of American parents with income less than $30,000 say they have a responsibility to help.
Not that you can blame parents for not volunteering to help with their adult kids’ expenses. 43% of the respondents said they already sacrificed their financial security for the sake of their children.
Parents who still work spend an average of 23% more on their kids ($605 per month) than on their retirement or savings contributions ($490).
This is why a majority (34%) surveyed said they plan to support their children for one or two years. Another 28% of parents say they’re willing to help for about three or four years. Only 18% did not give a timetable for ending their support.
American Parents Should Take Care of Themselves First
Right now, the idea of supporting grown children can represent a substantial drain on their savings. This is especially critical considering that for many Americans, inflation is eating a chunk of their money.
Shelly-Ann Eweka, senior director of financial planning strategy at TIAA, warns parents to prioritize. “Even with the additional responsibility of taking care of adult children, parents must also take care of themselves,” she said.
“It’s like when you’re on an airplane, and the flight crews say if you need to wear masks because of an emergency, you need to put yours on first before helping others.”
Watch the News Nation video reporting that 52% of parents still financially support adult children:
Are you a parent with fully-grown children? Do you still extend financial support to your kids even after they turned into adults?
Tell us what you think about financially supporting children. Share your comments below.