Parents Still Helping Foot the Billfor Their Young Adult Children
Posted Sep 12 2008 10:21am
I graduated college in 1986 with $300 in credit card debt. My first post-college apartment cost $287 a month in Gilbert, Arizona. My weekly gross income was about the same amount.
For the first six months, the living room in my one-bedroom apartment had no furniture in it, not even a couch. Mom helped out. She also helped out a year later when I bought a used car.
As a whole, I lived very cheaply. I clipped coupons. I knew where all the outlet stores were. I bought toilet paper and paper towels in bulk. (I still do, come to think of it.)
It was a real struggle the first 12 years out of college. Finances improved only incrementally – even as I became an editor – because journalism is not a particularly rewarding career financially.
Most college graduates today are having a much more difficult time, reports The New York Times. About 34 percent of young adults receive financial assistance from their parents. Some of that assistance is through room and board. There are a lot of reasons for this: high housing costs, low entry-level salaries and backbreaking college debt come to mind.
One of my biggest surprises in my post college life is the extent of financial help some peers received from their parents. I’ve had friends who received significant help purchasing first homes, financing multiple cars and furniture, or even upscale vacations.
Financial analysts often criticize parents for helping their kids, because it puts retirement plans at risk. Well jeesh, having kids in the first place puts retirement plans at risk. Besides, parents know that they’re not making a financial decision: They just want to give their children a decent head start.
I’m of mixed feelings on all this. On the one hand, I want my children to learn fiscal self-sufficiency as soon as possible. On the other, I know a big financial boost earlier in life – I couldn’t buy a house in the late 1980s because of the housing run-up back then – would have situated me much better today.
I suppose a lot will depend on what the U.S. economy looks like in 20 years. For now, I just worry making about enough to feed the family.