If You're Still Relying on Your Parents for Financial Support, You're Not Alone

woman looking at bill and holding her babyIf you're a millennial, you were likely raised with the message that a college education is critical to success in life and increased earning potential. Ironically, recent reports indicate that millennials continue to be financially dependent on their folks long after turning 18.

Advertisement

According to a study of 1,000 millennials and 1,005 millennial parents by the Bank of America and USA Today, 65 percent of millennials report that their parents have helped them out financially -- whether quite a bit or only slightly.

For instance, 40 percent continue to rely on parents for support for paying regular expenses like student loans and cell phone bills. And this includes millennials in the 30-34 age range (22 percent) and those who are married or living with a partner (20 percent).

The culprit? Student loan levels that are higher than they've ever been. Although a college degree is still likely to increase earnings over time, the majority of recent college graduates have loan levels that are equal to a shocking 80 percent of their annual income.

Recent graduate student Katie Johnson is a 31-year-old mom whose parents are still playing a role in her financial life. She says:

Honestly? I don't know how most people do it. I owe $80,000 in student loans, and my daycare for my two kids costs more than a mortgage payment. My parents gave us money for the down payment for our house and pay for our cell phones. I'm sort of embarrassed, but mostly grateful. Without my parents, we'd be renters forever. I will still be paying off my student loans when my oldest kid is ready to start college.

According to the research, Johnson isn't unique in facing financial hurdles as a result of students loans. "More than half of millennials who pay student loans say it has 'a lot' or 'some' impact on their ability to save and on life decisions," Mahsau Daee, an associate affiliated with the research, tells The Stir.

Daee also says that 20 percent of millennials say they are delaying starting a family and 14 percent are putting off marriage due to student loan debt. Ouch.

More from The Stir: 10 OMG Texts About Money Struggles That Are All Too Real (PHOTOS)

Meanwhile, family support doesn't always come in the form of a check every month. It could be in the form of health insurance and/or a place to live, as it is for Emily Park, a 26-year-old mom who lives in Edina, Minnesota, with her husband, new baby, and her parents.

"Saving on rent is critical," Park says. "My husband and I make $65K-ish combined, and that sounds great until you factor in that day care costs over $1,000 a month, and our student loan payments are $1,200 a month. I don't know what we'd do if my folks weren't willing to let us live in the basement."

To that end, the bill will come one day. Over 40 percent of millennials say they plan to return the favor and expect that they will financially contribute to taking care of their parents as they age. We can only hope we'll have all our student loans paid off by then!

 

Image via Steve Debenport/iStock.com

Read More >