As Adinah Caro-Greene plans her financial future, one consideration stands out that might not have weighed as heavily for earlier generations: her child.
 |
| Natalia Gdovskaia | Moment | Getty Images |
Working as an employee benefits broker, Caro-Greene has observed the financial struggles her Gen Z son and his peers face, driven by the soaring costs of education, housing, and healthcare.
A central part of her long-term financial plan is paying off a rental property that her son can eventually inherit—and potentially call home.
“It’s especially difficult for kids today,” said Caro-Greene, 45. “Seeing how tough it is for my son’s generation inspires me to do everything I can to help.”
She’s not alone. A U.S. Bank survey of roughly 2,500 adults revealed that 53% of Gen X parents worry their children may require financial support well into adulthood. This concern is significantly higher than the 37% average among parents across all generations.
Gen X occupies a unique position as the “sandwich” generation, often managing the dual responsibilities of supporting aging parents and helping children transition into adulthood.
While many Americans are grappling with inflation and its economic impact post-pandemic, Gen X parents are particularly focused on whether their children will ever achieve full financial independence.
A Generation of Worry
Gen Xers have lived through challenging economic conditions, which contribute to a persistent sense of financial insecurity, according to Tom Thiegs, a family wealth coach at U.S. Bank’s Ascent Private Capital Management. Over their lifetimes, they’ve experienced four of the five largest stock market crashes in history.
They were also among the first generations to rely predominantly on 401(k) plans instead of pensions for retirement savings. Now, many Gen Xers question whether Social Security and Medicare will remain viable long enough for them to benefit, despite having paid into these systems for decades.
While Thiegs notes that his Gen X clients are indeed worried, he emphasizes that they are not immobilized by fear. Having navigated economic downturns in the past, they’ve developed a mindset of adaptability and resilience.
“It’s not all doom and gloom for Gen X,” Thiegs said. “There’s a shared belief that they’ll figure things out, no matter what happens.”
Interestingly, Gen X parents are not typically concerned about their children’s ability to manage money. In fact, 79% of respondents in the U.S. Bank survey believe their kids are capable of successfully handling their finances.
The concern, Thiegs explained, arises from external factors beyond anyone’s control. Higher housing costs, escalating grocery prices, and other rising expenses have placed Gen Z in a financially vulnerable position, even for those with sound financial habits.
The Financial Role of Parents
For Caro-Greene, supporting her young-adult son financially feels almost unavoidable, especially given the high cost of living in the San Francisco Bay Area. She described the job market for recent graduates entering white-collar professions as particularly difficult.
The financial strain on parents is evident. A Savings.com survey published this year found that parents who provide financial support to their children spend an average of $1,384 per month. For parents with Gen Z children, that number jumps to $1,515.
This raises a crucial question: how long should parents continue offering financial help, and to what extent? Marguerita Cheng, a certified financial planner and CEO of Blue Ocean Global Wealth in Maryland, says the answer is deeply personal.
“I’d never discourage a parent from helping their child,” Cheng said. “But it’s equally important to establish boundaries and limits.”
She advises parents to avoid jeopardizing their own retirement or depleting their savings to support their children. At the same time, Cheng encourages open conversations about finances, emphasizing that parents can reduce the stigma associated with living at home or making other cost-cutting choices after college.
For those able to help, Cheng recommends setting clear guidelines, such as capping financial contributions or disbursing funds over a specific timeframe to provide structure and manage expectations.
A Holistic Approach to Money
According to Thiegs, Gen X’s life experiences have shaped a broader and more inclusive view of financial planning. It’s not just about balancing budgets anymore; it’s about considering how their resources can impact their children, aging parents, and other loved ones.
“They’ve embraced a more holistic perspective on money,” Thiegs said. “It’s about understanding what they want for their lives and their families in the long term, beyond the numbers in their bank accounts.”
0 Comments