Almost Half of American Parents Provide Financial Assistance to Grown Kids
Half of American parents are financially supporting their adult children, according to a report by Savings.com. This trend, which has grown steadily over the past few years, has reached a three-year high in 2025, with an average of $1,474 being spent monthly per child.
The survey reveals that 83% of respondents contribute to their adult children's monthly grocery bills, 65% assist with cell phone plans, 44% help pay off auto loans, and 45% pay for student loans. One-third of parents admitted to helping pay for rent or mortgages for those living outside the home.
This sustained financial assistance has consequences, with 60% of respondents admitting they have adopted a more frugal lifestyle to support their adult children. Ominously, half of the respondents reported dipping into their savings and retirement accounts, and another 31% have taken on debt to continue supporting their offspring. As a result, 35% believe they will need to push back their retirement plans.
The growing trend of parental financial support is significantly altering the fabric of society. The higher cost of living is a burden shared by multiple generations, with rent being at an all-time high. With entry-level jobs offering little respite, one-third of adults aged 18 to 34 are still living with their parents. Other aspects of life, such as groceries, cars, healthcare, and rent, have seen dramatic increases, making it challenging for young adults to become financially independent. This is one of the reasons for the declining birth rate among Gen Z and younger Millennials, who find it hard to forge their path.
The Enrichment Data suggests that this trend is driven by economic pressures, changing societal norms, and the lingering effects of the COVID-19 pandemic. Financial support takes various forms, often including groceries, bills, and even vacations, with most parents imposing conditions for this assistance. This increased parental support can strain the financial goals of the older generation, with nearly 38% reporting an impact on their long-term savings and retirement, and 39% on short-term goals. With so many parents in the "sandwich generation" supporting both adult children and aging parents, the financial strain can be immense, requiring some to sell investments or cut back on lifestyle spending.
In balancing family support and personal financial goals, open communication and planning are essential. Parents must assess their financial resources and prioritize their commitments, ensuring they can still meet their own retirement objectives. For adult children, this trend may indicate the need for a prudent approach to their financial lives, taking responsibility for their future as they strive to become financially independent.
- The financial assistance from parents to their adult children, as revealed in the survey, affects not only the current lifestyle and savings of the parents but also their long-term retirement plans, with nearly 38% reporting an impact on their long-term savings and retirement.
- In light of the growing trend of parental financial support, adult children might need to adopt a prudent approach to their personal finance, considering the potential challenges in becoming financially independent due to the increases in costs of living and the strain on the older generation's financial resources.
