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Parents of Millennials: How To Help With Debt

Parents dream of watching their kids grow up and leave the nest as mature, successful adults. But today more parents are financially supporting their children well past the age of 18. Why? A growing number of millennials struggle with high debt loads and can’t afford to move out without help.

These days it’s very normal for parents to continue helping their 20-something kids. In fact, a recent RBC poll said that 96 per cent of parents were still financially supporting at least one adult child.

Angus Reid sheds light on the debt picture of Canadian millennials, and why they continue to go to the bank of Mom and Dad for help:

  • Millennials are struggling with high consumer debt, including cell phone bills and car payments.
  • Student loans are the second most common form of debt for millennials under 25.
  • 64 per cent of millennials report having less than $25,000 in savings. 22 per cent said they have no savings at all.
  • Millennials are concerned about finding and keeping good paying jobs.
  • More than half of parents said they were helping to pay a millennial child’s monthly cell phone bill.


Most parents are happy to keep helping children with their debt as they transition into adulthood, as the intent is to prepare the child for future personal and financial maturity.

But it’s not unusual for parents to be cutting their kids cheques well into their 30s, and to the tune of $5,623 on average each year. This kind of ongoing support can quickly become a financial burden to parents as well.

But there’s more. Because of this troubling financial situation, millennials are also delaying other major life events, like owning a home and having a family.

Saving for the down payment is a huge challenge when you’re already carrying a lot of debt. Many millennials just can’t save enough to afford to buy a home without help. In fact, the Angus Reid poll showed that as many as 44 per cent of millennial homeowners had help from parents or other family in order to afford to buy their first home.

Those who can afford to buy are often being priced out of their current location, moving to more affordable cities that require longer commute time and expense. This can be an eye opener for many millennials who then willingly choose to sacrifice buying a home of their own, and instead opt for the many financial benefits of staying at home with parents.

This is when parents might start to worry. It’s common for parents to want to help their children get ahead in life, and give them a financial boost when they can.

But should you be supporting your kids when it puts your own financial future at risk?

Talking to your children about debt can be a challenging and emotional experience, especially when each of you have different views on the subject. However, parents shouldn’t feel like it is their duty to help cover the financial shortfall of their children, or pay the price for their bad spending habits.

If your millennial child’s debt exceeds what you can help them with, it might be time to talk to them about debt relief options available through a Licensed Insolvency Trustee (LIT). An LIT can explain the options to you and your child in order to determine the best way forward together.

Debt help with accountability

It is always good to keep your adult kids accountable.

Millennials living at home, or being supported by parents, should still be held financially responsible in whatever way works for you. That might mean they contributing to household expenses, paying a small amount of rent, purchasing their own groceries, or contributing through household chores like lawn and yard maintenance.

And along the way, your adult kids should be setting financial goals for themselves so they don’t lose sight of their own personal and financial identity.

Have regular conversations with your child about their debt to ensure things are on the right track. Ask questions like “Are you paying down debt?”, “Are you saving?” and “How much?” Direct questions can help you keep the dialogue open and honest and allow your kids to feel comfortable talking about the challenges they might be facing.

Managing money and debt between generations is a challenging and emotional task. Understanding what caused problems with your child’s finances, and how parents can support their child will help ensure that millennials will be able to move forward with financial confidence towards their goals, whether that be home ownership, or something else.

Are you a parent supporting your debt-stressed millennial child well into adulthood? Share your story on Twitter. #LeaveDebtBehind #ParentingTips #Housing

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