Parents need to let go — and millennials need to grow up!
According to a recent study by The Ascent, a personal finance brand by the Motley Fool, more than half of older millennials -- those between 30 and 38 -- said they’re still banking on Mom and Dad for up to a third of their monthly expenses.
Of all millennials age 23 to 38, only 37% are financially independent. The numbers for those in their 30s are slightly better, but still troubling. What’s worse, only 24% said they’re being pushed by their parents to become more financially independent.
“Parents aren’t actively pushing their children to be financially independent,” says The Ascent’s Nathan Hamilton. “If you look at the data, essentially one in four parents are actually pushing for their children to be completely financially independent.”
So don’t necessarily heap the blame on the kids in this instance.
“Seventy-two percent of the millennials surveyed would actually like to have their parents stop paying for things for them,” Hamilton says. “When we looked at this data, we found that millennials actually want to be financially independent from their parents. It’s more that they’re actually financially unable to do so due to various macroeconomic factors.”
How millennials live now
Focusing on respondents over the age of 30, the survey unearthed some surprising results: Just 46% of that age group are completely financially independent from their parents, while 54% are at least somewhat financially dependent on their parents. Financially dependent millennials between 30 and 38 are using their parents’ money to pay for one-third of their spending per month.
Additionally, 56% of millennials age 30 to 38 are pushing themselves to be more financially independent, while only about a quarter are being pushed by their parents. And just over half of the financially dependent 30-somethings feel stressed about handling their own finances, compared to 25% of those in that same age group who are financially independent.
Timing is everything
It’s important to remember that millennials in their 30s hit the job market in the lead-up to and the fallout from the 2008 financial crisis. But Hamilton says there is more historically at play working against them than that.
“If you take a bigger-picture look beyond 2008 and actually look back 40 years, the average salary for Americans -- adjusted for inflation -- has risen 11%,” he says. “But over that same time period, the average housing price -- adjusted for inflation -- in almost every market has increased at least 100% or more. This is regardless of generation.”
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