Adinah Caro-Greene is planning her financial future with a new variable that holds significant weight for her generation: her child. The rising costs of education, housing, and healthcare have created economic challenges for her Gen Z son and his peers. One of her long-term financial goals is to fully pay off a rental property that he can inherit and potentially live in.
Caro-Greene, aged 45, acknowledges the unique difficulties faced by children today and is motivated to do what she can to support her son’s generation. She is not alone in her concerns. A U.S. Bank survey of around 2,500 adults released earlier this year found that 53% of Gen X parents worry that their child may need financial support well into adulthood, compared to just 37% of parents across all generations.
Gen X parents are part of a “sandwich” generation, dealing with the financial pressures of supporting both aging parents and children coming of age. They have experienced economic challenges and uncertainties, having witnessed major stock market crashes and transitioning from pensions to 401K plans for retirement. There are concerns about the future of Social Security and Medicare, adding to their financial worries.
Despite these challenges, Gen X parents are not paralyzed by fear. They are prepared to adapt to unexpected economic changes and are confident in their ability to navigate financial uncertainties. While they trust their children to manage their finances successfully, the economic stress stems from factors beyond their control, such as rising living costs and a tough job market for young adults.
Parents like Caro-Greene often provide financial support to their young-adult children, especially in high-cost areas like San Francisco. The financial burden on parents can be significant, with some spending over $1,500 a month to support their Gen Z offspring. Financial planner Marguerita Cheng emphasizes the importance of setting boundaries and clear guidelines when providing financial assistance to children, ensuring that parents do not deplete their savings or struggle in retirement.
Gen X’s financial experiences have shaped their perspectives on money management, leading them to take a more holistic approach that considers the well-being of their children and other family members. They are focused on long-term financial planning and understanding how their financial decisions impact their lives and the lives of their loved ones.
