The majority of adults in the United States make a living with the help of their parents.
According to Northwestern Mutual’s 2026 Planning and Progress Survey, 42% of Americans say they rely on previous generations for financial support. This number includes 72% of Gen Z, more than half of Millennials, and one-third of Gen X.
Megan McCoy, a financial therapist and professor at Kansas State University, says this kind of intergenerational support can evoke strong emotions, whether mom and dad are funding a cell phone plan or a down payment on a house.
“When we talk about supporting adult children, there’s always a stigma attached to them, like ‘the child isn’t growing up’ or ‘the parents are too lenient,'” she says. “But I wish people saw this more as a dance between people, and I hope neither is the reason this is happening. This is a pattern that has developed over time.”
If done right, financial support from parents can serve as a “scaffolding” for adult children to use to build successful lives for themselves, McCoy said.
Smart financial aid requires constant communication, McCoy and other experts say. Without it, there is a risk of getting hurt, especially if one or both seek independence, or if one benefits at the expense of the other.
Maximize the impact of financial aid
If you want to eventually pass on wealth to your children, McCoy says doing it early allows your money to have the greatest financial impact.
“The whole cycle of waiting to be given a legacy is counterproductive,” she says. “Often, that inheritance is given when the child is most financially stable in life, rather than giving a gift when the child needs support the most.”
McCoy recommends using financial aid in ways that reduce financial stress for your child and help them get closer to their financial goals.
The former might be things like helping your child pay off their student loans, getting them health insurance, or covering emergency expenses. The latter could be contributing to the purchase of a home or paying your child’s rent while working through graduate school.
“We’re looking for something that will help them reach another level of development and access,” McCoy said.
Managing emotions associated with monetary gifts
Financial gifts can be emotionally charged. Parents may feel resentful about helping their children. Children may feel entitled to endless support or may feel ashamed to accept help. To avoid situations like this, McCoy says it’s important that all parties understand the idea behind the support.
It’s important for parents to ask about the reason behind financial gifts, McCoy said. “Make sure you’re not giving gifts out of guilt for not being there for them more or because you want to control their decisions,” she says. “And don’t give them gifts because you don’t think they can do it themselves.”
It is important for children to understand that this support is meant to provide temporary relief at a critical time. Nicky McDonald, a certified financial planner with Northwestern Mutual, says this doesn’t mean dependence on parents will continue indefinitely.
Some of her adult children’s clients think, “It’s always been that way, we get paid by our parents for certain things, so why change that?” McDonald says. “Some people consider it a necessity.”
Consult with a professional and your family.
For many families, providing ongoing support for their children is not practical. Couples with adult children often have to save for their retirement. Or you have elderly parents who need financial assistance.
To ensure long-term plans are on track, McDonald says parents should consult a financial professional before making financial gifts to their children.
For example, if you know your child might eventually need down payment help, “you want to be able to allocate $X in 10 to 15 years in case Susie or Johnny needs some help with this,” MacDonald says. “We can stress test that plan.”
If a down payment would jeopardize retirement plans or long-term care, MacDonald says the whole family can have “conversations that build expectations.”
Ideally, McCoy says conversations about intergenerational support should occur early and often to avoid financial and personal conflicts. “Being transparent within your family about the ‘why’ can be extremely beneficial on many levels, especially if you can confirm that the ‘why’ is one of the ‘good’ reasons.”
Do you want to get ahead at work? Next, you need to learn how to make effective small talk. In CNBC’s new online course, “How to Talk to People at Work,” expert instructors share practical strategies for using everyday conversations to increase visibility, build meaningful relationships, and accelerate career growth. Sign up now!
