parents Archives - Suburban Finance

1. Cell Phone

It’s no surprise that parents of millennials often help them pay their phone bills. Most likely, this is due to the ease, availability, and affordability of family cell phone plans. Kids are often already on the family plan when they enter adulthood, leave for college, or move out of the house. Parents may find it easy enough just to keep the kids on that plan. They’re used to paying that bill so it doesn’t feel like an added expense.

2. Rent/ Mortgage

13% of millennials report that their parents pay the full cost of their rent or mortgage bill each month. Many other parents help pay a portion of that housing cost. This is a big chunk of money. It’s certainly helpful to the adult kids not to have to pay the bill themselves. However, it can put a big strain on their parents.

3. Groceries

A large percentage of these parents pay for their adult children’s food including all of their groceries. Some of these kids might still live at home, in which case the parents are used to paying for all of the household food. In other instances, parents might pick up some groceries for their kids whenever they do their own shopping. But in other cases millennials buy their groceries on credit cards and their parents pay that bill when it arrives.

4. Automobile Costs

Millennials often get help from their parents when it comes to their cars. Parents might pay for some or all of the car loan. Alternatively, they may help out with car repairs when their kids can’t cover those emergency costs. Sometimes parents buy themselves a new car and pass the old one on to their adult children.

5. Vacations

It might be surprising that parents help their adult children pay for travel, but it’s a very common practice. In fact, it’s the third most common expense that parents pay a portion of behind groceries and the cell phone bill. In many cases, parents of millennials pay their vacation costs in order to spend time together as a family. Adult kids that have moved away may not be able to afford to travel back home without their parents’ help. The family might vacation together elsewhere each year. Whatever the reason, when millennials can’t afford a trip, they are generally comfortable asking their parents for financial help.

6. School and Student Loans

Many parents of millennials consider it their responsibility to pay for some or all of their children’s education. They pay the costs of tuition. They also help pay for books and other necessary supplies. Additionally, parents of millennials who have already graduated often help them pay back their student loans.

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Kathyrn Vercillo

Kathryn Vercillo is a professional writer with more than a decade of experience writing about healthy living and personal finance. She lives in San Francisco, where she has learned to maximize frugal living tips in order to thrive as a freelancer in one of the nation’s most expensive cities. When she’s not writing, she’s exploring the city on foot with her rescue dog. Learn more about her at www.kathrynvercillo.com.
Kathryn also writes about saving money with coupons over at GroceryCouponGuide.com

Millennials and Gen Zers tend to think that they’re going to be financially independent by age 22. Parents expect to support adult kids longer than that. However, parents find it embarrassing to support adult kids much more so than the kids themselves do.

When Kids Plan To Be Financially Independent

The Young Money Survey asked,

“At what age did you become, or expect to become, completely financially independent from your parent(s)?”

On average, both young millennials and members of Gen Z said age 22. That’s the age many kids graduate from college, so it makes sense on paper.

That said, there was some wide variation. 42% of Gen Zers and 34% of millennials expect financial independence by the age of 20. On the other end of the spectrum, 9% of Gen Zers and almost twice that many young millennials don’t anticipate financial independence until age 30.

Moreover, 2% of millennials say that even after age 30 they will not be financially independent from their parents. There were no Gen Zers in that category. Is that because they’re a generation that’s better with their money? Alternatively, is it because they’re young enough that age 30 seems impossibly far off?

How Long Parents Expect to Support Adult Kids

Most parents didn’t think that their kids were being realistic with those ages. More than nine out of ten parents surveyed expect to support adult kids to the age of 25.

Parents who have to support adult kids much longer than that are embarrassed by the idea. On average, they say it’s embarrassing to support adult kids past the age of 27. In fact, 60% of parents say it’s embarrassing to support adult kids between the ages of 20-29.

Only 25% of parents say that it’s okay to support kids up to age 29 but that sometime in the next decade, it gets embarrassing. A few parents aren’t embarrassed to support adult kids later in life. 4% said it gets embarrassing between ages 40-49 and 3% said it starts getting embarrassing after age 50.

Kids Aren’t as Embarrassed to Receive Support

Members of both Gen Z and the Millennial generation say, on average, that age 30 is when it starts to get embarrassing to receive financial parental support. However, more than a third don’t find it embarrassing until sometime in their 30s. 8% of young millennials and 9% of Gen Zers say it’s not embarrassing until you’re in your 40s. And 5%+ say it’s not embarrassing to receive financial support from parents even after the age of 50.

Other Survey Findings

So, the younger generations expect to be able to support themselves sooner, even though they aren’t embarrassed if they can’t.

Here are some of the other findings from the Young Money Survey:

Most of these kids expect to earn as much as, if not more than, their parents.
About two thirds of them are setting aside savings, but most of them are saving less than $200 per month.
About 1/3 of millennials and less than 1/4 of Gen Zers have emergency funds set aside.
Fewer than half of millennials and less than one third of Gen Zers have and follow a budget.
2/3 of those surveyed would rather contribute to their own retirement than donate to charity.