Study: Parents Spend $500 Billion Annually On Adult Children
Groceries, cell phones, car payments and student loans — these are just some of the many expenses parents are taking over on behalf of their adult children. If you've wondered how much it all adds up to, a new study by Merrill Lynch and Age Wave has the answer.
The study, conducted over several months, involved more than 2,500 respondents from around the country. It found parents are shelling out a stunning $500 billion annually on adult children ages 18 to 34, which is twice as much as they put into retirement accounts.
Of all parents who said they were providing some kind of financial support, 60 percent reported helping their adult childern purchase food and groceries, some 54 pecerent said they helped pay for cell phones, and 47 percent helped their childern pay their car expenses.
Researchers also found 59 percent of parents with adult children expect to help pay for their children's weddings, 26 percent expect to contribute to their children's first homes, and one-third plan to contribute to their grandchildren's college costs.
The study didn't address what might be causing parents to become financial crutches for their growing children. It could be rising costs of living, stagnant wages or perhaps kids never recieved enough financial guidance.