Seventy-four percent of parents help pay for their adult children’s living expenses, according to a new CreditCards.com and BankRate survey.
The cellphone bill is the most common expense parents help pay, and other top expenses they assist with include transportation (e.g. car repairs, gas), rent and utilities.
In total, 52% of parents said they helped their children pay down their student loan debt. Respondents aged 55 and over were significantly more likely than those aged 35-54 to help their adult children with debt payments.
Meanwhile, only 16% of respondents said they helped an adult child pay a credit card bill.
Grown adults are still dependent on their parents
CreditCards.com senior industry analyst Matt Schulz says parents who feel compelled to assist their children can face some negative repercussions. While their generosity comes from a good place, it may not be wise.
“In helping their kids, parents can get themselves into some trouble. The vast majority of Americans are going to struggle with retirement savings. That money isn’t going into your retirement accounts in the future. It’s important that parents don’t do so blindly without understanding what the potential ramifications are for their own futures,” he told Yahoo Finance.
“The truth is not all parents are good role models with their finances. The truth is a lot of parents have great intentions but aren’t necessarily equipped to give the best advice,” he added.
Market research firm YouGov interviewed 1,092 adults with children 18 and over to do the survey. The company did not break down the respondents by how old their children are. It’s safe to surmise that those 22+ would receive substantially less help from their parents, after graduating college and receiving some sort of income.
Then, of course, there are those parents who cut their children a check every month or perhaps once a year. In these instances, they might not be helping their adult children out of necessity — instead, they may be subsidizing their kids’ luxury wardrobes or fancy dinners.
As fresh college grads flock to expensive cities for high-skilled jobs, they struggle to cover their day-to-day expenses with meager entry level salaries. Nearly half of folks in their early 20s get help from their parents to pay for rent, according to surveys cited earlier this year by The New York Times.
Melody Hahm is a senior writer at Yahoo Finance, covering entrepreneurship, technology and real estate. Follow her on Twitter @melodyhahm.
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