It’s common knowledge that the current times are more challenging compared to the past. Recent research indicates a growing trend where parents are prioritizing supporting their adult children financially over saving for their own retirement.
A recent study conducted by Pew Research revealed that three out of every five parents provided financial assistance to their adult children in the previous year. This aligns with previous Pew research findings, indicating that approximately half of individuals under 30 years old are residing with their parents—a significant surge from previous years. This trend is accompanied by delayed marriage and parenthood among young adults, leading researchers to define a new life stage called “emerging adulthood.”
The economic difficulties faced by young adults in 2024 are not unexpected. The surge in inflation has driven up the cost of living in many regions of the U.S. Moreover, college expenses have skyrocketed in recent decades, resulting in an overwhelming increase in student debt. Housing expenses and interest rates have also surged, making homeownership unattainable for the average American, particularly the younger population, thereby exacerbating the ongoing affordability crisis.
These financial challenges have prompted many older adults to adopt a phenomenon known as “snowplow” parenting, wherein they proactively remove obstacles from their children’s paths well into their adulthood. According to Pew Research, 28% of individuals aged 18 to 34 received parental assistance in the past year to cover household expenses such as groceries and utilities. Additionally, 25% received help with phone bills or streaming services, 17% with rent or mortgage payments, 15% with medical bills, and 11% with educational expenses.
Surprisingly, less than half of young adults under 30 claim to be financially self-sufficient. Even beyond the age of 30, one-third of adult children still rely on their parents for financial aid in some form.
Furthermore, over a third of parents surveyed in the Pew study expressed that supporting their adult children financially was negatively impacting their own financial well-being, but many feel compelled to do so due to the perceived economic challenges and changing landscape. Teresa Bailey, a certified financial planner in Nashville, noted that parents believe achieving complete financial independence is more challenging in the current economic and societal climate.