Extent of Parental Assistance

The report details that approximately 50% of U.S. parents with adult children are providing regular financial support, contributing an average of $1,474 per month. This marks a 6% rise from the previous year, which totals nearly $18,000 each year.

• 83% assist with groceries
• 65% help with cell phone bills
• 46% contribute to vacation expenses

Additionally, parents are aiding with larger costs such as tuition and housing. For the Generation Z demographic (ages 18-28), the average tuition support from parents has quadrupled, reaching nearly $1,800 per month.

Demographic Insights

There is a noticeable divide in the level of support offered based on generational lines:

• $1,474/month: average support for adult children overall
• $863/month: average support for Millennials (ages 29-44)
• $1,800/month: average support for Generation Z

Interestingly, 77% of parents now attach conditions to their financial help, which includes requirements such as contributing to household expenses or aiming towards financial independence.

Causes of Increased Support

The uptick in financial assistance from parents can be traced back to the economic turmoil exacerbated by the COVID-19 pandemic, as high inflation and increased living costs continue to affect young adults’ financial stability. Since 2022, Savings.com has recorded this trend, highlighting that the ongoing economic climate keeps many young individuals dependent on parental assistance.

Consequences for Parents

This growing trend carries significant implications for parents, particularly those near retirement. Nearly half of the parents providing support report that it adversely affects their financial wellbeing, forcing many to make sacrifices such as decreasing their spending or tapping into retirement savings. About 40% of parents have indicated plans to reduce support within the next two years.

While 53% of parents feel compelled to assist, this figure is down from 61% last year, which suggests a gradual change in perception regarding financial support.

Future Trends

Looking forward, a significant portion of parents (40%) plan to withdraw financial support within the next two years. This shift could encourage greater financial independence among younger adults, although it raises concerns, especially if economic uncertainties and potential recessions loom larger.

If inflation persists or employment opportunities diminish, Gen Z may experience the most significant impact, particularly those still pursuing education or new employment.

Survey Methodology

The findings presented stem from a survey by Savings.com conducted in February 2024, involving 1,001 U.S. parents of adult children. The focus was exclusively on parents without disabled adult children, ensuring a broad yet specific examination of this crucial topic.

The respondents had a median age of 56 and reported an average income between $50,000 and $74,999.