(Michele Blood – LifeZette) Boomer and Gen X parents may be harming themselves — and their adult children — by spending far too much money supporting financially struggling millennials, according to a 2018 study by Merrill Lynch in partnership with Age Wave, a thought leader on aging.
“We estimate that parents of adult children annually spend $500 billion on them — twice what they contribute to their own retirement accounts,” said the study report, “The Financial Journey of Modern Parenting: Joy, Complexity and Sacrifice.”
The startling $500 billion figure includes full or partial support for adult children’s expense categories, including food or groceries (60 percent), cellphone (54 percent), car (47 percent), school (44 percent), vacations (44 percent), rent or mortgage (36 percent), and student loans (27 percent).
The $500 billion parents spend supporting these adult children under the age of 34 does not include less frequent but big-ticket items such as weddings and the first homes.
Nearly one in three temporarily independent young adults between the ages 18 and 34 returns to live in their parents’ homes. The surprising figure represents a 50 percent increase in the number of “boomeranging” adult children in 1960, according to the Census Bureau.