Parents are helping 42% of US adults cover costs, study says

A large slice of American adults is still getting financial help from the generation above them, according to Northwestern Mutual. For everyday investors and savers, the finding points to a household money issue that can affect retirement plans, debt payoff, housing decisions and family relationships at the same time.

Northwestern Mutual’s 2026 Planning & Progress Study found that 42% of Americans say they rely on the previous generation for financial support. The share is highest among younger adults: 72% of Gen Z respondents, more than half of millennials and one-third of Gen X respondents reported some reliance, according to the study.

That support can range from smaller recurring costs, such as a phone bill, to larger help, such as money for a home down payment. Megan McCoy, a financial therapist and professor at Kansas State University, told CNBC that families often frame the issue as someone’s fault, either an adult child who has not become independent or a parent who gives too much. She said that misses the broader pattern, which usually develops over time between both sides.

A financial therapist works with the emotional and behavioral side of money. McCoy told CNBC that parental help can work like temporary support beams for an adult child when it is handled well, giving them room to build a more stable life.

Timing can change the value of family help

McCoy told CNBC that families planning to pass wealth to children may get more impact from giving some of it earlier, rather than waiting until an inheritance. Her point: inheritances often arrive when adult children are already more financially secure, while earlier gifts may help during periods of higher stress or transition.

She said useful support often falls into two categories. One reduces pressure, such as helping with student debt, keeping an adult child on health insurance or covering an emergency cost. The other helps a child reach a goal, such as contributing toward a home purchase or helping with rent during graduate school.

McCoy said the strongest cases are ones that help an adult child gain access to a next step in life, rather than turning family support into an open-ended habit.

Money gifts can carry emotional costs

Family financial help can create resentment, shame or entitlement if expectations are not clear, according to McCoy and other experts cited by CNBC. McCoy said parents need to be honest about why they are giving money. She warned against gifts driven by guilt, a desire to control a child’s choices or a belief that the child cannot manage without help.

Nikki Macdonald, a certified financial planner with Northwestern Mutual, told CNBC that adult children also need to understand when support is meant to be temporary. A certified financial planner is an adviser who has met education, exam and ethics requirements for personal financial planning.

Macdonald said some adult children become used to the arrangement because it has existed for years, and may start seeing parental support as a necessity.

Parents have their own balance sheet

Ongoing help is not realistic for every family. CNBC noted that parents of adult children may still need to fund their own retirement or assist aging parents.

Macdonald told CNBC that parents should talk with a financial professional before making major gifts to adult children. If a family expects a future down payment request, she said advisers can model whether setting aside money for that goal would strain retirement or long-term care plans.

If support would put parents’ finances at risk, Macdonald said families can have a conversation that sets expectations. McCoy told CNBC that early, repeated discussions about why support is being offered can help reduce both money conflicts and family tension.

This story draws on original reporting from CNBC.