As a parent with firsthand experience, I recognize the challenge in balancing support for one’s children with maintaining personal financial goals. While it is relatively easy for me to decline late-night favors—such as picking up my teenage son at midnight—I find it more difficult to say no when he requests money for dinner outings, although I carefully limit these occurrences monthly.
Conversations with peers whose children are older have reinforced an important insight: parental responsibility often extends well into young adulthood, encompassing emotional, logistical, and financial support. Yet, a failure to manage financial assistance prudently may inadvertently harm parents’ ability to secure a robust retirement.
Recent data highlights a striking figure that caught my attention: parents who provide monetary support to their adult children average $1,474 per month per child. This amount is alarming yet understandable, given the contemporary economic obstacles young adults face. Issues like stagnant income, inflation-related expenses, and lingering student loan debt impede many individuals in their twenties and thirties from gaining financial independence.
Of particular concern is the comparison between the funds parents give their grown children and their own retirement contributions. According to the same data source, the typical monthly financial support to children exceeds twice the amount contributed to parents’ individual retirement accounts or 401(k) plans—$1,589 compared to $673, respectively.
This disparity suggests a trend where parents prioritize the immediate financial needs of their adult offspring over their long-term retirement security. While $673 a month toward retirement savings is respectable, the disproportionate allocation implies that some parents might be sacrificing their financial future to aid their children in the present.
For parents who enjoy strong financial stability, continuing to support grown children can be appropriate and beneficial. However, for those still in pursuit of building a sufficient retirement nest egg, caution is warranted. Retirement savings should ideally take precedence over ongoing financial assistance to adult children. When such support becomes a stressor, initiating frank discussions about finances is imperative.
Supporting adult children is not limited to monetary aid. Alternative approaches include offering practical assistance, such as babysitting grandchildren to help reduce childcare costs for adult children or preparing and delivering home-cooked meals to alleviate expenses associated with takeout. These non-financial forms of support can provide meaningful help without undermining parents’ economic wellbeing.
Ultimately, the inclination to help one’s children remains strong throughout life. Nevertheless, parents must be vigilant not to jeopardize their retirement security by overextending financial support. Establishing boundaries and recognizing when to say no are vital steps to maintaining financial health, both for themselves and their families.