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Parents Are Risking Their Retirements To Support Adult Children



One day your child will grow up and leave you. Or will they?


With younger generations facing tough economic circumstances, many parents are supporting their children long past the college years. Nearly half of young adults in the US live at home, and millions more are receiving help with rent, bills and everyday costs. For parents, it’s a major expense, sometimes requiring greater debt loads, depleted savings and delayed retirement plans.


Kori Shafer — a 49-year-old commercial insurance producer with two twentysomethings living with her in Craig, Colorado — said she and her husband want to support their children as they transition into adulthood. But at the same time, she wonders how long their living situation will last — and what she’s enabling if her stepson is spending $900 a month on a sports car and insurance, when he says the reason he’s living with them is to save for a house.


“I’ve gotten to the point where I’ve been ready to move out myself,” she said. “We want to still help and protect them. But also push them to grow.”


With greater student debt levels and a lack of affordable housing, the percentage of young adults living with their parents is roughly on par with the 1940s. To be sure, there have always been kids who stay home after high school or return following college, including many who do it to save money as they start their careers. But the uptick now is being driven, in part, by how the pandemic normalized living with parents. It’s also gotten harder to find good entry-level jobs and afford a higher cost of living.


Financial Strain

The pandemic put “the whole business of growing up on a different timetable than in the past,” said clinical psychologist Mark McConville, author of Failure to Launch: Why Your Twentysomething Hasn’t Grown Up and What to Do About It. As a result, children have become dependent for longer, and during high-cost times, that’s putting a strain on parents’ finances.


US parents spend about $500 billion every year on their 18- to 34-year-old children, which is double what they put towards retirement, according estimates in a Merrill Lynch and Age Wave study. 


“I thought at this point my kids would be working good jobs, but I’m constantly using up my savings to help them progress,” said Angela Trice-Bari, a 52-year-old schoolteacher in Oak Park, Michigan.


Trice-Bari thought that by allowing her kids, ages 21, 22 and 33, to live at home during college and grad school they’d have enough to buy a home at age 28, like she did. But she realizes that goal is largely out of reach. Now, she’s drained her savings and dipped into retirement funds to help pay for their education, food, travel expenses and more — especially for her son who lost his job.


Like a lot of parents, she hopes her children will repay her someday. Her youngest is going to school to become a lawyer and says she’ll help financially after graduation next year.

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