More than half of 20-somethings still count on money from their parents to pay their bills
Frazer Harrison/Getty Images
Frazer Harrison/Getty Images
- More than half of Americans aged 21 to 37 have received financial assistance from a parent, guardian, or family member, according to Country Financial.
- Many are using this money for everyday needs, such as groceries and rent.
- This cohort also leaves the nest later in life - 35% still live at home with their parents.
The latest is in regarding the myriad financial struggles millennials are facing: More than half of Americans (53%) aged 21 to 37 have received financial assistance from a parent, guardian, or family member since turning 21, according to the latest Country Financial Security Index.
About 37% receive money monthly, and more than half (59%) receive money a couple times a year. Many are putting this money toward basic needs, both small and significant, like cell phones, groceries and gas, health insurance, and rent.
None of this is quite shocking considering that millennials are looking at pricier health insurance premiums and higher rents than their parents did at their age. In 1960, the adjusted-for-inflation median rent was $588; today, the current median US rent is $1,600.
And they're balancing all of that on top of other increased expenses, like the cost to buy a home and college tuition.
Relying on their parents for more money is further evidence that millennials born in the 1980s have been struggling to catch up financially ever since the Great Recession. As of 2016, this cohort had wealth levels 34% below where the would most likely have been if the financial crisis hadn't occurred, putting them at risk of becoming a "lost generation" that accumulates less wealth, according to an earlier report by the Federal Reserve Bank of St. Louis.
Yet, despite these struggles and relying on their parents, 9 in 10 Americans are spending money on things they want, but don't need, while 4 in 10 are tapping into their savings, and 1 in 8 are neglecting their retirement. A quarter of them are using credit cards or delaying savings in order to afford experiences, like vacations, according to the Country Financial report.
Despite feeling like an adult at an early age, 38% don't believe they shouldn't have complete financial independence until age 25 or later. Perhaps this explains why Americans leave the nest later in life than they used to - more than 35% of millennials still live with their parents.
"This should not necessarily be viewed as a negative thing as long as there are clear fiscal goals in place," Doyle Williams, an executive vice president at Country Financial, said in the press release, adding that using this time to build an emergency fund, save for a down payment, and focus on long-term goals can help millennials build financial independence.
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