At What Age Should You Become Financially Independent From Your Parents?

One of the most common refrains in stories written about millennials and Generation Z is the burden of debt. It's hardly an unfounded stereotype; a 2024 Pew Research Center report found a sharp rise in the number of young adults saddled with student loan debt from the '90s, plus a significant uptick in the value of mortgage debt. All that debt has shifted the relationship of these generation cohorts with their parents. For young adults between the ages of 18 and 34 years old, the research found that less than half of them were financially independent. A 2023 Experian survey, meanwhile, found that 61% of Gen Z and 47% of millennials (for 54% total) needed at least some financial assistance from their parents.

Pew's research found broad majorities of parents and their young adult children to be happy in their relationships with one another; yet, there remains a stigma attached to relying on your parents still as an adult. There also remains a perception among these two groups that it's difficult to impossible for them to be wholly independent, given the economy, while parents report feeling their own finances burdened by supporting adult children. (Previously, we delved into how money-phobia is affecting millennials and Gen Zers today.)

But in part because of the very different financial and social environments the baby-boom and Generation X groups grew up in, parents and young adult children today can have opposing ideas of when the latter should become financially independent. On average, parents today expect young adults to handle at least some bills one to three years sooner than their children do.

One to three years' difference in taking over certain bills doesn't seem like such a large gap between generations. And there's an overall consensus on some financial matters between baby-boom parents and their millennial and Gen Z children as well. Bankrate found that 20 to 21 was the agreed age for taking over payments to subscription services like Netflix, for instance. And between 22 and 24 was seen as acceptable for taking on the debt from student loans.

In fact, across a wide range of financial matters, the generations seem to agree that, while the exact age might vary, the early 20s is the age range when a young adult should start to become financially independent. But the realities of early 21st-century life — decades of flat wages and the burden of student loan debt among them — all conspire against a sharp demarcation between dependence and self-sufficiency. The early 20s are more likely to start a transition period, one where young adults gradually take on financial responsibilities while still receiving some help from their parents.

That transition may well last beyond the early 20s, though. In the American health care system, for example, children can remain on their parents' insurance plans until they're 26, and family plans for cellphones and other devices can keep generations connected to a single arranged payment. (By the way, among the generations, Generation X was found to be the generation that spends the most.)

Helping one's adult children transition to financial independence can be a tricky balancing act for parents, who have to juggle their children's needs and wants with their own financial burdens. But there are strategies that can help make those conversations and transitions easier. One that comes into play even earlier in a child's life is discretionary spending. For example, parents may agree to handle or assist with essential payments while making children responsible for leisure and luxury. (Speaking of which, it's also a good time to share budgeting tips and money-saving hacks like the 24-hour rule or the 30-day savings rule or the latte effect.)

Talking with children early in their adulthood can make sorting out financial assistance and the timeline for when it ends easier on both generations. It can also help in drafting a plan to transfer certain bills in time. Perhaps a parent agrees to cover a cellphone payment for two years out from the conversation, giving their adult child time to prepare their budget far in advance. It's also important for parents to be honest about what they can afford to help with. Too many sacrifices for an adult child can end up harming the parents' long-term financial future, and may end up burdening both parent and child when the parents reach their retirement age.