Well Into Adulthood and Still Getting Money From Their Parents
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Well Into Adulthood and Still Getting Money From Their Parents

Nearly 60% of parents provide financial help to their adult kids, a new study finds

By JULIA CARPENTER
Fri, Jan 26, 2024 10:05amGrey Clock 4 min

Parents have always supported their children into adulthood, from funding weddings to buying a home. Now the financial umbilical cord extends much later into adulthood.

About 59% of parents said they helped their young adult children financially in the past year, according to a report released Thursday by the Pew Research Center that focused on adults under age 35. (This question hadn’t been asked in prior surveys.) More young adults are also living with their parents. Among adults under age 25, 57% live with their parents, up from 53% in 1993.

Parental support is continuing later in life because younger people now take longer to reach many adult milestones—and getting there is more expensive than it has been for past generations, economists and researchers said. There is also a larger wealth gap between older Americans and younger ones, giving some parents more means and reason to help. In short, adulthood no longer means moving off the parental payroll.

“That transition has gotten later and later, for a lot of different reasons. Now it’s age 25, 30, 35, 40,” said Sarah Behr, founder of Simplify Financial Planning in San Francisco.

Kami Loukipoudis, a 39-year-old director of design, and husband Adam Stojanik, a 39-year-old high-school teacher, knew they would need parental assistance to buy in New York’s expensive home market.

“We could pay a mortgage, but that down payment was the absolute crusher,” Stojanik said. “The idea of trying to save up on our own—as long as we were paying rents in NY, would’ve taken 300 years.”

Loukipoudis’s mother gave them the money for a 10% down payment on a two-bedroom apartment in the New York borough of Queens.

The young-adult allowance

Adult children aren’t necessarily getting larger checks from their parents, but they are staying on the parental payroll for longer than previous generations, according to Marla Ripoll, professor of economics at the University of Pittsburgh who studied the trend by analysing payments from parents to adult children over a 20-year span.

Ripoll found that 14% of adult children receive a transfer of money from their parents at least once in any given year, and roughly half get financial help at some point within that period. Those rates have been stable for years. What has changed is that the transfers now continue for much longer, she found. This longer-term help might be a drag on social mobility, as it becomes even harder for young people from lower-income families to catch up, researchers said.

Of the young adult children who said they received financial help from a parent in the past year, most said they put it toward day-to-day household expenses, such as phone bills and subscriptions to streaming services like Netflix, according to the Pew survey.

The amount of money and the frequency of help varies by age; those on the older end of the 18-to-34 cohort are far likelier to say they are completely financially independent from their parents compared with younger adult children, as many in the latter group are completing their education. Nearly a third of young adult children between the ages of 30 and 34 say they still get parental help.

Heather McAfee, a 33-year-old physical therapist in Austin, Texas, said she lived at home between 2019 and 2021; otherwise she wouldn’t have been able to make progress paying down her student loans while rent prices in her area remained so high. The plan worked—she has since reduced her student-debt balance from $83,000 to $15,000.

“It helped tremendously,” she said. “I didn’t have to take out more loans to pay for apartment living or anything like that. That stress was gone.”

Setting limits on financial help

A little more than half of parents surveyed said that having their adult children home brought them closer together or improved their relationship, but nearly 20% said it dented their personal finances.

Financial advisers often find themselves in the tricky position of speaking to both ends of the equation: adult children who need assistance and the parents determined to help children well into middle age, within limits.

Whereas previous generations would step into a greater sense of financial independence in their early 20s, young adult children today are often unable to reach similar markers of such independence—living on their own or buying their first home, for example—without greater financial resources.

Families typically don’t set concrete rules around when financial help will happen and what the money is used for, which can result in surprises down the road, Behr said.

In one case, Behr’s clients received the down payment they needed to purchase a condo from a generous mother-in-law. Years later, that same mother-in-law told them she expected a payout once the couple sold the home.

The hand-me-down payment

Down-payment help from parents—a given for many first-time home buyers—is growing thanks to higher home prices and elevated mortgage rates.

About a fifth of first-time home buyers said they got help from a relative or friend when pulling together the money needed for a down payment, according to a 2023 survey of home buyers and sellers from the National Association of Realtors. And 38% of home buyers under age 30 received help with the down payment from their parents, according to a survey this spring by Redfin.

Wealthy families often go further than helping with the down payment. They become a true bank of mom and dad and write a mortgage. The Internal Revenue Service sets minimum levels of interest for such loans, which remain significantly cheaper than current mortgage rates.

Timothy Burke, chief executive at National Family Mortgage, which facilitates such loans, said parents are often frustrated on behalf of their house-hunting children. High interest rates and the cutthroat housing market are holding their children back from reaching a milestone the parents themselves were more easily able to access.

Mei Chao, a 41-year-old stay-at-home mom, and her husband, William Chao, a 44-year-old information-technology specialist, bought their first house as a couple in 2017. They relied on financial help from her husband’s two sisters and his mother to help them bridge a gap in their house-buying timeline. While they waited to sell William’s Manhattan condo, they used the money from the family to purchase the new house in Queens.

The structure of the agreements got tricky. After selling the condo in Manhattan, Mei and her husband were able to repay his sisters in full. But they didn’t have enough money left over from the sale to do the same for Mei’s mother-in-law. So they kept the mother-in-law’s name on the deed to the house—a concession Mei said they were both more than happy to make.

“Ultimately, it all worked out. I’m glad his mother pushed us,” Mei said. “Without her help, I could not say we would have this home.”



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A Killer Golf Swing Is a Hot Job Skill Now

Companies are eager to hire strong players who use hybrid work schedules to schmooze clients on the course

By CALLUM BORCHERS
Fri, Jun 14, 2024 5 min

Standout golfers who aren’t quite PGA Tour material now have somewhere else to play professionally: Corporate America.

People who can smash 300-yard drives and sink birdie putts are sought-after hires in finance, consulting, sales and other industries, recruiters say. In the hybrid work era, the business golf outing is back in a big way.

Executive recruiter Shawn Cole says he gets so many requests to find ace golfers that he records candidates’ handicaps, an index based on average number of strokes over par, in the information packets he submits to clients. Golf alone can’t get you a plum job, he says—but not playing could cost you one.

“I know a guy that literally flies around the world in a private jet loaded with French wine, and he golfs and lands hundred-million-dollar deals,” Cole says.

Tee times and networking sessions have long gone hand-in-golf-glove. Despite criticism that doing business on the course undermines diversity, equity and inclusion efforts—and the fact that golf clubs haven’t always been open to women and minorities —people who mix golf and work say the outings are one of the last reprieves from 30-minute calendar blocks

Stars like Tiger Woods and Michelle Wie West helped expand participation in the sport. Still, just 22% of golfers are nonwhite and 26% are women, according to the National Golf Foundation.

To lure more people, clubs have relaxed rules against mobile-phone use on the course, embracing white-collar professionals who want to entertain clients on the links without disconnecting from the office. It’s no longer taboo to check email from your cart or take a quick call at the halfway turn.

With so much other business conducted virtually, shaking hands on the green and schmoozing over clubhouse beers is now seen as making an extra effort, not slacking off.

Americans played a record 531 million rounds last year. Weekday play has nearly doubled since 2019, with much of the action during business hours , according to research by Stanford University economist Nicholas Bloom .

“It would’ve been scandalous in 2019 to be having multiple meetings a week on the golf course,” Bloom says. “In 2024, if you’re producing results, no one’s going to see anything wrong with it.”

A financial adviser at a major Wall Street bank who competes on the amateur circuit told me he completes 90% of his tasks by 10 a.m. because he manages long-term investment plans that change infrequently. The rest of his workday often involves golfing with clients and prospects. He’s a member of a private club with a multiyear waiting list, and people jump at the chance to join him on a course they normally can’t access.

There is an art to bringing in business this way. He never initiates shoptalk, telling his playing partners the round is about having fun and getting to know each other. They can’t resist asking about investment strategies by the back nine, he says.

Work hard, play hard

Matt Parziale golfed professionally on minor-league tours for several years, but when his dream of making the big time ended, he had to get a regular job. He became a firefighter, like his dad.

A few years later he won one of the biggest amateur tournaments in the country, earning spots in the 2018 Masters and U.S. Open, where he tied for first among non-pros.

The brush with celebrity brought introductions to business types that Parziale, 35 years old, says he wouldn’t have met otherwise. One connection led to a job with a large insurance broker. In 2022 he jumped to Deland, Gibson Insurance Associates in Wellesley, Mass., which recognised his golf game as a tool to help win large accounts.

He rescheduled our interview because he was hosting clients at a private club on Cape Cod, and squeezed me in the next morning, before teeing off with a business group in Newport, R.I.

A short time ago, Parziale couldn’t imagine making a living this way. Now he’s the norm in elite amateur golf circles.

“I look around at the guys at the events I play, and they all have these jobs ,” he says.

His boss, Chief Executive Chip Gibson, says Parziale is good at bringing in business because he puts as much effort into building relationships as honing his game. A golf outing is merely an opportunity to build trust that can eventually lead to a deal, and it’s a misconception that people who golf during work hours don’t work hard, he says.

Barry Allison’s single-digit handicap is an asset in his role as a management consultant at Accenture , where he specialises in travel and hospitality. He splits time between Washington, D.C., and The Villages, Fla., a golf mecca that boasts more than 50 courses.

It can be hard to get to know people in distributed work environments, he says. Go golfing and you’ll learn a lot about someone’s temperament—especially after a bad shot.

“If you see a guy snap a club over his knee, you don’t know what he’s going to snap next,” Allison says.

Special access

On a recent afternoon I was a lunch guest at Brae Burn Country Club, a private enclave outside Boston that was the site of U.S. Golf Association championships won by legends like Walter Hagen and Bobby Jones. I parked in the second lot because the first one was full—on a Wednesday.

My host was Cullen Onstott, managing director of the Onstott Group executive search firm and a former collegiate golfer at Fairfield University. He explained one reason companies prize excellent golfers is they can put well-practiced swings on autopilot and devote most of their attention to chitchat.

It’s hard to talk with potential customers about their needs and interests when you’re hunting for errant shots in the woods. It’s also challenging if you show off.

The first hole at Brae Burn is a 318-yard par 4 that slopes down, enabling big hitters like Onstott to reach the putting green in a single stroke. But to stay close to his playing partners and keep the conversation flowing, he sometimes hits a shorter shot.

Having an “in” at an exclusive club can make you a catch. Bo Burch, an executive recruiter in North Carolina, says clubs in his region tend to attract members according to their business sectors. One might be chock-full of real-estate investors while another has potential buyers of industrial manufacturing equipment.

Burch looks for candidates who are members of clubs that align with his clients’ industries, though he stresses that business acumen comes first when filling positions.

Tami McQueen, a former Division I tennis player and current chief marketing officer at Atlanta investment firm BIP Capital, signed up for private golf lessons this year. She had noticed colleagues were wearing polos with course logos and bringing their clubs to work. She wanted in.

McQueen joined business associates on the golf course for the first time in March at the PGA National Resort in Palm Beach Gardens, Fla. She has lowered her handicap to a respectable 26 and says her new skill lends a professional edge.

“To be able to say, ‘I can play with you and we can have those business meetings on the course’ definitely opens a lot more doors,” she says.

MOST POPULAR
11 ACRES ROAD, KELLYVILLE, NSW

This stylish family home combines a classic palette and finishes with a flexible floorplan

35 North Street Windsor

Just 55 minutes from Sydney, make this your creative getaway located in the majestic Hawkesbury region.

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