(CNN Newsource) – A growing number of parents are using their retirement savings to financially support their adult children. According to a new report, parents who do that may be digging themselves into a money hole.
Half of American parents aren’t cutting the financial cord, saying they sacrifice retirement savings to support their adult kids.
The Bankrate survey found higher earners with adult children are more likely to dip into their savings while lower-income parents are more likely to have never saved for retirement at all.
In fact, one in six parents making less than $50,000 said supporting their grown-up children prevented them from putting away anything for retirement.
Meanwhile, 60% of those with adult children and a household income of $80,000 said they’ve cut back on their retirement savings in order to pay for their adult children’s bills. That includes cell phone and car payments, insurance, housing and student loans.
In general, parental assistance usually ends between the ages of 19 to 23. However, millennials believe the cut-off should be delayed by a year or more.
So why are their parents increasingly dipping into their savings to support them?
The survey mentions “helicopter parenting,” suggesting more parents have been more co-dependent with their children throughout childhood, making it difficult to let go in adulthood.