Almost half of U.S. adults aged 18 to 29 are living with their parents or receiving financial assistance from family, according to a recent Federal Reserve report. The study also found that 49% of young adults live in the family home, while 47% receive financial aid to cover living expenses.
The proportion of young adults residing with their parents has increased by 6 percentage points since 2022 and by 12 percentage points since 2019, the year before the COVID-19 pandemic began. For those receiving outside financial support, the most common reasons cited were help with housing costs such as rent, mortgage, or utilities, as well as bills for cell phones and other general expenses.
Economists suggest these trends have significant societal implications. Laura Ullrich, director of economics at Indeed Hiring Lab, noted that when household formation slows, it affects the typical ages for marriage and having children, potentially leading to lower fertility rates.
"People buy fewer houses. It impacts local schools. It’s silly to think about if you’re not an economist, but it has much more far-reaching economic implications than just thinking, oh, there’s just a bunch of adults living at home," Ullrich explained. She attributes this reliance on parental support to factors including challenges in securing a first job and escalating housing costs.
Ullrich stated, "Given what you see written about housing affordability and current inflation rates, but also the difficulty young adults are having in finding a first job, it’s not surprising to see that number go up."
The trend extends beyond the youngest demographic, with 26% of adults aged 30 to 44 also reporting receiving financial help from outside their household in the past year. Experts warn that these shifts could shape the U.S. for decades, influencing decisions about where young adults live and work, with broader macroeconomic consequences.
Young adults who might have previously relocated to major cities for early career opportunities are now more likely to remain closer to home. Ullrich emphasized that these micro-level household decisions have macro-level impacts on broader societal structures.