As we navigate an ever-changing economic landscape, the role of parental support in shaping the financial futures of younger generations has taken on new dimensions. For many Gen X parents, the burden of supporting their adult children amid rising costs and an uncertain economic climate has become an increasingly pressing concern. The financial challenges facing today’s youth are significantly different from those experienced by previous generations, prompting this cohort of parents to rethink their roles in providing financial assistance.
Adinah Caro-Greene, an employee benefits broker from the Bay Area, has firsthand experience with these challenges. With soaring tuition fees, skyrocketing housing prices, and inflated healthcare costs, she recognizes that her Gen Z son and his peers are confronting a far more treacherous financial landscape than she did at their age. This realization has not only informed Caro-Greene’s long-term financial goals—specifically, her intent to pay off a rental property for her son to inherit—but it has also influenced her opinions about the support he may require. “It’s uniquely hard for kids now,” she notes, emphasizing that her experiences compel her to act decisively.
The U.S. Bank’s survey indicates that Caro-Greene’s sentiments are echoed by many Gen X parents grappling with similar concerns. Fifty-three percent of those surveyed expressed anxiety regarding their children’s ability to achieve financial independence without support. This figure starkly contrasts with the 37% of parents across all generations who share the same worries, highlighting a unique burden borne by this middle generation of caregivers.
Characterized as a “sandwich generation,” Gen X finds themselves navigating the delicate balance of providing for both aging parents and their own children. They have lived through extensive economic turmoil—from stock market crashes to the unprecedented impacts of the COVID-19 pandemic. Such financial experiences have left a lasting imprint, fostering a sense of uncertainty about the future, particularly as many question the longevity of social safety nets like Social Security and Medicare.
Family wealth coach Tom Thiegs notes that, unlike previous generations, Gen X is acutely aware of the financial fragility that surrounds them. Many grew up witnessing significant market downturns and have resigned themselves to a reality where adaptability is crucial. “It’s not just all doom and gloom for Gen X,” Thiegs continues, pointing out the generation’s resilience and willingness to “roll with unexpected punches.” This adaptable mindset becomes vital as they confront anxious thoughts about financial security.
Despite their concerns, many Gen X parents do not fear that their children are financially inept. In fact, the U.S. Bank study found that a remarkable 79% of parents view their children as capable financial managers. The economic obstacles that hinder their children’s independence are often beyond anyone’s control. Rising living costs are a significant stressor that causes parents to feel compelled to lend financial support, particularly when it comes to housing.
In regions with the most elevated living expenses, like San Francisco, it is increasingly common for parents to assist their young-adult children financially. Monthly expenditures to support adult children have escalated to an average of $1,384, with figures even higher for Gen Z offspring. This reality forces families to grapple with an important question: how long and to what extent should parents provide assistance without compromising their own financial health?
Financial planner Marguerita Cheng suggests a nuanced approach to assistance that blends generosity with responsible planning. While she encourages parents to help their children, she emphasizes the need for boundaries to avoid jeopardizing their retirement plans. Cheng advocates for open conversations around financial topics, aiming to destigmatize living at home and other arrangements common among new graduates.
Moreover, establishing clear guidelines for financial support can be beneficial. For parents with the means to assist, setting caps on assistance amounts or providing money in incremental payments can create a sustainable framework for both parents and children. By doing so, they empower their adult children while ensuring their own financial future remains intact.
As we consider the evolving financial landscape, it is evident that Gen X parents are adopting a more holistic view of money—one that incorporates their own needs as well as those of their children. This generation’s experiences have reshaped its understanding of financial security, leading to more thoughtful approaches to intergenerational support. In doing so, Gen X is not just navigating their children’s financial futures; they are learning how to thrive together in a precarious economy.