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Goodbye empty nest: young adults are moving back home
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If one or more of your adult children moved back home, your family is part of a widespread trend in America. People in their 40s and 50s who are caring for children and aging parents are known as the Sandwich Generation. According to a recent study by 桔子视频, 75% of these Sandwich Generation parents report that they anticipate supporting adult children until they are financially stable or for as long as necessary.
What's behind this societal shift? Some of today鈥檚 young adults may have different attitudes toward relationships and marriage, but economic factors also play an important role. As college loan debt and the cost of living continue to rise, moving back in with mom and dad may be a cost-effective housing option for many adults ages 18 to 34.
How the Sandwich Generation is supporting adult children
While having all your family members back together can be a rewarding experience, it can sometimes disrupt your own financial plans like saving for retirement. For parents who are supporting their adult children, our study found 73% are assisting with groceries and eating out and nearly two thirds are helping pay a cell phone bill. And four out of five children are receiving help from their family to manage their debt.*
With their college years behind them, your children may be just entering the work force full time. If they鈥檙e open to guidance, they may benefit from a few tips you can share to help them get the most from their first post-college job. Remind them that this position does not have to be their dream job, but offers an opportunity to gain professional experience, earn a regular paycheck and possibly take advantage of other employee benefits.
Four of five adult children are receiving help from their family to manage their debt.*
Budgeting conversations and building financial literacy
If you have an adult child living under your roof, one of the first things you should talk about as a family is money and creating a budget, followed by helpful ways they can boost their financial knowledge and money management skills. For 48% of respondents, they say they would feel better prepared to support their adult children if they had taught them about financial responsibility.
As you discuss a budget, look at all their expenses, from transportation and gas costs to phone bill and insurance coverage. Explain what strategies work for you when managing your personal finances and how a budget can help them make the most of their monthly income. To create a financial roadmap, encourage your child to make a list of:
- All of their financial obligations (rent, car payment, cell phone bill, student loans)
- Due date for each payment
- Amount of each payment
If there is room in their budget to start saving money for retirement, encourage your adult children to start a Roth IRA or contribute to an employer-sponsored 401(k). Financial experts know that retirement accounts started when people are in their teens or 20s can end up being worth much more than those started later in life.
Even if you鈥檙e covering a portion of their expenses, having a detailed list and timeline can help make sure you鈥檙e on the same page financially. As you revisit this overview every six months, you can determine ways you can begin to lessen your contributions as they take on more financial responsibility.
Promote healthy money habits
The better your children understand how to manage their personal finances and save for the future, the more confident they become in financial decision-making. Encouraging healthy money habits is key to helping them build a strong foundation and achieve financial independence. But since family dynamics can sometimes be tricky, you may find involving a financial professional as a neutral third party can help make financial discussions less stressful and more productive.
Balancing your own financial obligations with that of your child鈥檚 can often be challenging, but the sooner you begin your discussions about expenses and expectations, the better you can be at preventing conflicts down the road. For the parents in our survey, 80% said having a financial heart-to-heart with their kids led to a positive outcome. By working together, you can help your child begin their next chapter, while continuing to build momentum toward your own retirement goals.
Jump-start financial conversations with your adult children. Take our Sandwich Generation quiz to get additional tips.
Take our quiz to learn about the unique challenges you may face if you鈥檙e caring for both children and aging parents and how to navigate this life stage more successfully.
Want the most from your retirement? Get smarter with Smart Strategies from 桔子视频. Your source for tips, tools and financial solutions that can help you live your best life.
*桔子视频 contracted Harris Poll to survey 1,024 adults aged 40-59 who provide financial support to at least one adult child (aged 18 and out of high school) living in their home without significantly contributing to household expenses, and who provide financial or caregiving support to at least one elderly relative. The survey was conducted between January 2, 2025 and January 19, 2025.
The term 鈥渇inancial professional鈥� is not intended to imply engagement in an advisory business with compensation unrelated to sales. Financial professionals will be paid a commission on the sale of an 桔子视频 annuity.
