Skip to content

  • Young adults in the U.S. are taking longer to reach “major life milestones” that affect finances than they did four decades ago, according to a Pew Research Center analysis.
  • In 2021, adults who were 21 years old were less likely to be in full-time employment; be financially independent, living independently or married; or have more children than their predecessors in 1980.
  • Here’s how parents can tackle the challenge of supporting their grown children financially, according to experts.

Young adults in the U.S. are taking longer to reach “major life milestones,” including financial independence from parents and living on their own, than they did four decades ago, according to a Pew Research Center analysis released Tuesday.

In 2021, adults who were 21 years old were less likely to be in full-time employment; be financially independent, living independently or married; or have more children than their predecessors in 1980.

Today’s young adults are closer to full-time employment and financial independence by age 25, an analysis of Census Bureau data shows. Financial independence is defined as a single income of at least 150% of the poverty level.

More than personal finance.
Should college graduates be financially independent?
House Democrats will update the Social Security reform proposal
Avoid tax hassles with payment apps like Venmo, PayPal

In 2021, about 39% of 21-year-olds worked full-time, compared to nearly two-thirds in 1980. And only a quarter were financially independent from their parents, down from more than 40% in 1980, the analysis found. .

There are several reasons for the differences between each group, including higher college enrollment over the past 40 years, said Ted Rossman, senior industry analyst at Bankrate. Nearly half of 21-year-olds are enrolled in college today, compared to only 31% in 1980, according to a Pew Research report.

Today’s group may also face other challenges.

“I would argue that young adults now face much higher costs for housing,” Rossman said, buying a car, food and gas. “So I think there is a strong inflationary component.”

Although many parents want to help their children, it can be expensive. More than two-thirds of parents have made or are currently making financial sacrifices, such as not saving more for retirement or an emergency fund or paying off debt, to help their grown children, Bankrate reports.

“A big theme in our survey was the idea that you should put on the oxygen mask before helping others,” Rossman said.

It’s important to “examine your own situation” before offering to help older children, said Paul Golden, executive director of the National Foundation for Financial Education.

Before loaning your child out or allowing them back into your home, work together to determine exactly how long the situation will last.

Paul Golden

Executive Director of the National Foundation for Financial Education

And if you decide to help, you should make a time-bound plan.

“Before loaning your child out or letting them come back into your home, work together to determine exactly how long the situation will last,” she suggested.

Golden added that “one of the best ways to help your adult children live a healthy financial lifestyle is to model the behaviors you want them to emulate.”

[ad_2]

Comments

Leave a Reply

Your email address will not be published. Required fields are marked *