Real Estate

Here’s how many Gen Zers rely on their parents to keep up with today’s high costs of living

By
Hannah Frishberg
Published July 11, 2024, 12:19 p.m. ET

A near majority of zoomers are backed by a familial subsidy. 

According to new findings published this week by Bank of America, a whopping 46% of Gen Zers are dependent on financial assistance from their relatives. 

The report, which is entitled “Parent Trap,” surveyed more than 1,000 zoomers (defined as those presently aged between 18 and 27) earlier this year, and found that more than half (52%) said they don’t make enough money to live the life they want — a situation they most significantly blamed on the current high cost of living.

bank of america gen z spending report
To offset a high cost of living, many young people are turning down social events. Getty Images/iStockphoto

As a result, many young people continue to rely on the bank of mom and dad well into adulthood, with 54% of those polled admitting that they don’t pay for their own housing. Gen Zers who are paying for their own housing, meanwhile, said it was consuming most of their income, with 64% reporting spending more than 30% of their monthly paychecks on it. 

In response, many late-teen and 20-somethings have resorted to what’s known as “loud budgeting,” or being vocal about what they can realistically spend while socializing with friends. This has proved such an effective budgeting strategy that the Bank of America findings note that “Gen Z may be drawing firmer financial boundaries compared to other generations at the same age.” 

bank of america gen z spending report
Many are resorting to “loud budgeting” to set firmer spending boundaries, such as opting to stay at home over going out. Getty Images/iStockphoto

Indeed, dealing with a tough real estate market and economic realities has made zoomers adapt impressive monetary boundaries to offset growing expenses through lifestyle changes. They include eating out less (43% reported doing this), turning down friends’ event invites (27%) and frequently less shopping in pricey grocery stores (24%).

“Though faced with obstacles driven by the cost of living, younger Americans are showing discipline and foresight in their saving and spending patterns,” noted Holly O’Neill, Bank of America President of Retail Banking, adding “It is critical that we continue to empower Gen Z to work toward achieving financial health and meeting their long-term goals.”