Young adults in Generation Z are increasingly finding themselves in the "sandwich generation," financially supporting both their children and their aging parents, according to a 2026 report from MyGuideToRetirement.org. This dual responsibility is forcing a substantial number of these individuals to tap into their retirement savings to meet basic financial needs.
The report, which surveyed over 1,000 U.S. earners, found that 39% of Gen Z individuals are currently providing financial support for both a child and a parent. This places them as the second-largest demographic in the sandwich generation, closely trailing millennials, who comprise 46%.
These financial obligations include covering costs such as groceries, rent, housing expenses, medical fees, health insurance, and assisted living or in-home care for older relatives. The burden has led to significant emotional and financial stress for Gen Zers.
Emotional and Financial Burden
Study authors noted that Gen Z carries a particularly heavy emotional burden, with 75% reporting feeling emotionally responsible for helping a loved one. This is the highest rate among all surveyed generations. Consequently, 76% of Gen Z adults frequently experience stress about their personal finances due to these family obligations.
The financial strain has prompted many to make difficult choices. The findings indicate that 30% of Gen Z adults have already withdrawn money from a retirement account to manage these responsibilities. This rate is higher than that of millennials (22%), more than double that of Gen X (11%), and over three times that of baby boomers (6%).
Experts warn that these early withdrawals can have severe long-term consequences, primarily by hindering decades of potential compound growth on investments. This could force Gen Z to delay retirement and postpone other significant financial milestones, such as paying off debt, building emergency funds, or purchasing a home.
Navigating Financial Challenges
The report acknowledges that supporting loved ones has become a common reality for many Americans, with intergenerational financial support extending to adult children, grandchildren, and aging parents. As caregiving demands grow and economic uncertainty persists, financial planning strategies may need to incorporate the likelihood of supporting family members.
To mitigate the impact, the study suggests that families engage in open conversations about expectations, establish realistic boundaries, and integrate these responsibilities into their financial plans. This approach could help individuals better support their relatives without jeopardizing their own future financial security.