53% of Millennials Still Rely on Parents — What That Record Number Means for Wealth
Recent research has concluded that an astonishing number of millennials rely on the bank of mom and dad.
According to the Northwestern Mutual's 2026 Planning & Progress Study, 53% of millennials are financially dependent on their parents. While there’s no shortage of strong opinions surrounding both the parents and grown kids in these situations, an issue less talked about is the wealth gap between millennials who got (or continue to get) help from their parents and the millennials who didn’t (and don’t).
Good To Know: What Your Parents' First Paychecks Might Look Like Today
Consider This: 13 Subtly Genius Things All Wealthy People Do With Their Money — That You Should Do, Too
Is this micro wealth gap between millennials a new phenomenon, or something older generations experienced? Why does this gap exist and how do the millennials on the unlucky end of it thrive? Let's break it down:
Boomer Parents Want Their Kids To Enjoy Their Inheritance Now
The reason millennials are getting help from their parents isn't so much because they were dealt a tough blow in their youth with the Great Recession and, therefore, their parents feel sorry for them. Instead, it’s more because their (largely baby boomer) parents are less interested in having their wealth be tied up in assets to be passed down after they die and more keen on having their kids (even if those kids are in their 40s) enjoy some of that wealth now, in whatever way helps.
“People really care about gifting and helping their heirs, not as an inheritance, but more of a living inheritance, passing down that wealth when the assistance might be more helpful than when they're already 65 and retired,” said Evan Mills, MBA, associate financial advisor at Scholar Advising. “It allows the next generation to retire earlier, build up their retirement accounts, spend more time with their kids and take that vacation. It allows more flexibility than what we've seen in the past.”
How Inheritances Are Built Has Changed
Once upon a time, let's say 50 years ago, the financial legacies of the American middle class were largely tied up in pension plans. With the seismic shift to 401(k) plans and 403(b) plans came a more hands-on approach that has benefitted some investors and enabled them to get wealthy enough to help their grown kids.
“Instead of only relying on Social Security and pensions with a fixed amount of assets each year, if you were a smart investor and saved early, you now have a larger amount to give to the next generation,” Mills said. “That's only a couple generations old, and it certainly adds to the wealth we see in America now."
Not One of the Lucky Ones? You’re Not Alone
When you come across reports describing just how many millennials have received support from parents — and just how many millennials still are receiving help — and you’re not among them, keep in mind that there are more than 73 million millennials in the U.S., per Marketing Charts. Therefore, there are tens of millions of fellow millennials who aren’t getting money from mom and dad, which means you’re far from alone.
Furthermore, studies as recent as last year's Northwestern Mutual Planning & Progress Study showed that the majority of millionaires in the U.S. are self-made. If that isn't proof that you can do this whole wealth-building thing on your own, what is?
Let the Lack of Support Drive You To Make Smart Investments
David Han, founder and site operator at AIStockWire.com, is one of those millennials who didn’t get a handout from his parents; in fact, he’s living the opposite situation — helping them out financially. He’s also got something that millennials who have had so much handed to them may not have: drive.
“I got nothing handed to me, and some of the people I know in that same boat are further ahead today than people who had every advantage,” Han said. “No safety net forced them to move. Sitting still was never an option they had. Start investing early, even with small amounts, since nobody is going to hand you a financial education, you have to go get it yourself. And when you see a calculated risk worth taking, take it; don't wait around for a cushion that isn't coming.”
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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