Young adults still living at home draining parents' retirement fund, U of A study says

If you’re finished high school and still living at home, you’re not alone — but new research from the University of Alberta shows that extended stay could be hurting your parents’ retirement.

Families with adult children living with them have 24% less in savings and assets than families without

Young adults are moving out later and less often and that's hurting their parents' retirement savings, new research shows. (Brian Snyder/Reuters)

If you're finished high school and still living at home, you're not alone.

But, according to a University of Alberta sociologist, your extended stay could be putting a crimp in your parents' retirement plans.

According to research from Michelle Maroto, parents whose grown-up children had not flown the coop will accumulate 24 per cent less in financial assets and 23 per cent less in savings than those lived on their own.

Maroto used longitudinal data, which followed the same families for 20 years, to study how assets and savings changed over the years.

The increased costs of having another person in the home, such as higher utility use or groceries bills, are obvious.

But if an adult child is living at home, it is often because they're going to school or struggling to make ends meet. And this means parents may be inclined to step in.

"When young adults are struggling, parents tend to help them out," Maroto told CBC's Radio Active Wednesday.

Maroto also attributes the longer stays at home to some adulthood expectations being relaxed in recent years.

"We don't have similar expectations for everyone to, right away, go get married and have kids as soon as you reach adulthood," she said. "Young adults today are doing that a lot later than their parents did."

According to 2016 census data, 34.7 per cent of young adults between the ages of 20 and 34 were living with at least one parent. It's a number that has steadily increased from 30.6 per cent in 2001.

Edmonton is below the national average, with 26.8 per cent living with a parent, while Toronto has the highest rate in the country at 47.4 per cent.

But as with most studies, there is always room to expand the research.

Maroto's data is from North America, and she said it's not necessarily representative of other cultures where multigenerational families are more common.

She'd also like to look at more data collected over longer periods of time. It is less surprising to see students to live at home until they finish school and get a job, and she is curious to find out if there is a bit of give-and-take with adult children in the long run. 

We don't have similar expectations for everyone to, right away, go get married and have kids as soon as you reach adulthood.- Michelle Maroto

"We might see children then giving back to their parents and helping them out," Maroto said.

Or, she added, maybe not.

"We also might see a situation where children continue to struggle and don't necessarily have the ability to do so."