Study reveals more than half of American parents in these 36 states shell out to support their adult children

The gravy train is still chugging along for many young and not-so-young adults, as their parents continue to foot the bill for phone plans, health insurance, streaming services and more.

We surveyed parents of Gen Z and Millennial adults in states with populations of 2 million or more to find out where adult children are getting the most financial support from their parents.

Key findings

• 65% of parents give their adult children (ages 22-40) some kind of financial support.
• Of those who support their over-age-22 offspring, the average monthly amount is $718.
• 1 in 3 parents who support their adult children say it puts them under financial strain.
• American parents on average believe children should be financially independent by the age of 24.
• 43% of parents who continue to support their children in adulthood say the support is offered with no contingencies.
• Parents in Washington, New Jersey and Virginia offer the most financial assistance of the states examined to their adult children.
• Parents in North Carolina, Pennsylvania and Wisconsin are least likely of the states examined to offer financial support to their adult children.

States where parents financially support their adult children the most

Whether you have kids or not, you’ll probably be surprised at the numbers of parents who are still supporting their adult children. While overall just 65% of parents are offering some kind of financial support, the data changes pretty heavily on a state-by-state basis.

For example, parents in California, Washington and Virginia average over $800 per month in financial compensation for their children, while those in Iowa contribute an average of just $349 per month.

Our system for scoring levels of support doesn’t just rely on dollar amounts, however. Along with the average dollar value of monthly support offered, we also factored in the total percentage of parents who were offering support and the variety of support offered. Together, we weighed these three factors equally to generate our support scores and determine how each state ranked.

Top types of financial support parents offer their Millennial and Gen Z children

Food is one of the most basic necessities for survival, but given recent inflation, it’s become even less affordable for many. This is likely one reason why help with groceries is the No. 1 type of support parents provide their children, according to our research. Closely followed is help with housing, then phones and basics such as clothing.

• Parents in Louisiana, Georgia and Texas are most likely to be helping with smartphones and phone plans.
• Parents in Colorado, Washington and California are most likely to be paying for entertainment subscriptions like Netflix and Spotify.
• Parents in New Jersey, Pennsylvania and California are most likely to be helping pay off debt.

At what age should someone be financially independent? Parents’ opinions differ by state

Media may have you believing that once you turn 18, you’re on your own. However, statistics don’t reflect this. The age at which parents think you should be financially independent will vary based on your state.

As you might guess, in states with higher costs of living such as New York, parents don’t expect you to be financially independent until you’re nearly 26. This is in contrast to states such as New Mexico and Nevada, where the average expected age is just under 23.

Many parents feel their adult children need support due to the economic climate

The past few years haven’t been easy for many people, so it makes sense that a sizable percentage of parents believe their grown children still need support. And while some parents will make their aid conditional, nearly half are willing to keep providing with no strings attached.

• 51% of parents believe Millennials need more financial support than previous generations because of the economic climate.
• 84% of parents who financially support their adult children say their support does not cause resentment or tension in the relationship.

Some parents set conditions on financial support

Financial support may be more common than not, but that doesn’t mean it’s a free-for-all. While many parents are willing to hand over aid without any contingencies, a majority note that certain goals or thresholds must be met to maintain their support. For 74% of parents who put contingencies on their help, this can mean the recipient must have a job, go to therapy or avoid risky behaviors.

Despite this, just 31% of parents state there is a time limit for how long they’re willing to financially assist their children.

Financial tips for parents providing financial help to their Millennial and Gen Z children

Make sure the financial support is reflected in your budget as an expense

Proper budgeting is a key factor in financial success. If you’re assisting your children with financial aid — whether that’s a monetary contribution or just jumping in to pay the phone bill, you’ll want to make sure you’re factoring those costs into your budget. This can help you help your family without impacting your own future.

Want to make sure your budgeting is where it needs to be? Check out our explanation of the 50/30/20 budget rule.

Check up on your retirement outlook from time to time

Saving for retirement is something best started early. After all, compounding interest can turn your initial investments into a healthy nest egg by the time you retire. Financially assisting your children may affect saving towards your retirement — but it’s always important to keep an eye on your outlook. After all, you don’t want to find yourself ready to quit working only to realize that you don’t have the funds available to do so.

Of those surveyed, one in five said yes when asked, “Are you having to adjust your retirement plans/withdraw from your retirement nest egg in order to provide support for your child?” About three in five respondents said no to that question, while the remaining parents either selected that they preferred not to say or indicated that they do not have retirement plans.

Use the right rewards credit card if you’re paying for something directly

If you’re one of the parents who helps their children with groceries, cell phones or entertainment subscriptions, it’s easy to assist your kids while also assisting yourself. If you can, using a rewards credit card rather than paying cash can help generate valuable points on purchases that you make.

For example, the American Express® Gold Card, which has an annual fee of $250 (terms apply, rates & fees), allows you to earn 4 Membership Rewards points per $1 at restaurants, plus takeout and delivery in the U.S., 4 points per $1 at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1 point), 3 points per $1 on flights booked directly with airlines or through American Express travel and 1 point per $1 on other eligible purchases.

These are flexible American Express Membership Rewards® points that can be redeemed for reward flights, hotel stays, gift cards and more.

For younger adult children, help them build credit

Although those adult children who are closer to 40 than 22 may already have established credit histories, those who have just become adults or are in college may still have some developing to do. As their parent, you’re uniquely situated to help them plan ahead and start building credit early.

This can be something as simple as adding your child as an authorized user to a card you already own. As you use the card and make on-time payments, this positive history gets recorded on your child’s credit reports as well as your own.

You may also want to help them with applying for and responsibly using a student credit card, which are created specifically for college students.

^{For rates and fees for the American Express® Gold Card please visit this page.}