Key Takeaways:
- Growing cost of living in the US has forced 1/3 of young adults to live with their parents
- A large chunk of them get financial support from their parents to pay for their expenses
- Inflation has caused financial and emotional stress to over 60% of US parents supporting adult offspring
YEREVAN (CoinChapter.com) — Inflation in the United States challenges the financial security of many American households. The situation has become so severe, that many adults in the US take money from their parents to survive. According to a recent survey by the personal finance platform Credit Karma, almost one-third of citizens between the ages of 18-26 rely on their parents for financial support. The survey, which the platform conducted with over 1,000 adults in October, revealed some worrying results.
Over 50% of the parents that participated in the poll said their adult kids continue to live with them. Around the same number of parents, 48%, claimed to be paying for basic expenses for their adult children. These include their cell phone monthly plan and other bills.
In what comes as an indication of the dire financial crisis in the US, a quarter of those that participated revealed that they provide pocket money or monthly allowance for their young children. A large chunk of them even pay the housing rent for their child, CNBC reported citing the survey.
Such figures are indicative of the growing unemployment and inflation in the United States. Many young adults in the Gen Z category are unable to find a job. Others just don’t make enough to pay for their expenses.
“With mounting student loan debt, persistently-high inflation and an uncertain economy, many parents are having to financially support their adult children beyond just the basics – and it’s starting to have a negative impact on their mental and financial well-being,”
the report reads.
Supporting young adults in the US is a financial burden
While a growing number of parents have little choice but to support their adult offspring, it comes as a huge financial and emotional burden on them. As high as 81% of parents who financially support their adult children say it impacts their finances in several ways.
While more than half are forced to change their lifestyle, a close 49% have little choice but to cut down on their expenses to support their children.
“What used to be paying your kid’s cell phone bill every few months has now turned into a much more extensive set of expenses for many parents,”
Courtney Alev, consumer financial advocate at Credit Karma said.
In an even more worrying revelation, about 25% of parents have resorted to taking debt to support their children. A whopping 30% claimed they are working longer and have prolonged their retirement as a result, while 41% see this negatively impacting their retirement savings.
Besides the financial ramifications, the scenario also impacts the mental health of these parents. As many as 65% suffer mental stress as a result.
Out of this number, a majority 56% blame the stress on inflation. While 52% said they were under pressure because of a lack of savings, 41% saw their growing debt as the reason behind the mental tension.
Supporting their adult children is breaking the family piggy bank. According to the Credit Karma survey, some 29% of the participants agreed that they are forced to choose between buying groceries, paying for gas and rent, or supporting their children.
With over 63% of US citizens living paycheck to paycheck, the situation doesn’t look promising. The number of US adults that take money from their parents will grow in the months to come.
