Nearly half of young adults still rely on parents for housing and expenses

Living at home with their parents or receiving financial assistance from mom and dad have become part of the way of life for many young adults under the age of 30.

As many as 49% of those aged 18 to 29 still reside in their family home, while another 47% rely on family assistance for living expenses, according to the recent Economic Well-Being of US Households report issued by the Federal Reserve.

Economists who have studied the report say these trends are having wide-reaching impact on society.

“When household formation slows, it slows new household formation, which also makes the age where people typically get married go up, the age people have their first child go up, fertility rates go down,” said Laua Ullrich, a director of Economics at Indeed Hiring Lab.

“People buy fewer houses. It impacts local schools,” Ullrich added. “It’s silly to think about if you’re not an economist, but it has much more far-reaching economic implications than just thinking, ‘oh, there’s a bunch of adults living at home.’”

Having spent years studying economic trends, Ullrich attributes the reliance of today’s young adults on family to their difficulties landing a first real job and housing costs that continue to soar.

The Fed’s data also revealed a 6% increase since 2022 in the number of young adults still living with their parents, and a 12% jump since 2019, one year before the COVID-19 pandemic.

“Given what you see written about housing affordability and current inflation rates, but also in the difficulty young adults are having finding a first job, it’s not surprising to see that number go up,” she said.

For those relying on family assistance for living expenses, the report revealed housing costs for rent, mortgage and utilities and other expenses such as cell phone bills as the most common areas young people need a financial boost.

Those in the 30 to 44 age bracket are also struggling, the report shows, with more than a quarter (26%) reported receiving financial help from outside their household during the past year.