One in five (22%) Americans support an aging parent and/or
an adult child, with these “financial supporters” spending an average of
$12,000 a year to help their family, TD Ameritrade found in its 2015 Financial
While only 22% said they need to dip into their savings to help their family members and only 30% made small sacrifices and lived more frugally, financial supporters hold nearly $100,000 in debt. This includes $22,000 in credit card balances, personal lines of credit or student loans, and $75,000 in mortgage debt.
Nearly two-thirds (64%) of financial supporters say they are
very glad to help a parent, and 53% are very glad to help a child. Just over
one-third (36%) would delay their retirement to financially support their adult
children. A majority (69%) of financial supporters plan to continue supporting
their adult children until they find well-paying jobs.
Financial supporters are nearly twice as likely to support a mother (43%) than a father (23%), giving their mothers $5,000 more in support each year.
Conversations about financial support happen when a family member asks for help, with 44% of financial supporters’ parents having asked for help and 52% of children having asked for help. However, 79% of financial supporters have not discussed their support of others with a financial professional.
“The financial downside of living longer may mean not only planning for our own extended retirement years, but also caring for aging family members in ways that can take a solid bite out of any well-laid plans,” says Matthew Sadowsky, director of retirement at TD Ameritrade.