How Staying at Home Affects the Economy

A new Federal Reserve survey offers a somber look at how young Americans are getting by: a lot with their parents’ help, from paying a phone bill to even living at home. The data comes from the Fed’s Report on the Economic Well-Being of U.S. Households, which found that 49% of adults ages 18 to 29 live with their parents, and another 47% of adults in that same age group received help from someone outside their household to pay an expense—money toward a cell phone bill, general living expenses, or housing costs.

The Impact of Staying at Home The impact of staying at home is far-reaching. It delays the ages at which people typically get married, have children, and buy homes. This demographic shift also impacts housing markets, school enrollment, and retirement ages.

Financial Support Financial support is not limited to young adults. 26% of adults ages 30 to 44 also reported receiving financial help from outside their household. This trend is not surprising, given the difficulty young adults are having finding a first job and the high inflation rates.

Economic Effects The economic effects of this trend are significant. It will structurally alter the economy and is likely to show up for years in migration patterns and lifetime earnings as much as in survey data.

The economy will respond to this trend in the long term. The delay in marriage, childbearing, and homeownership will have a ripple effect throughout the economy. It will impact housing markets, school enrollment, and retirement ages. Economists note that this trend will have long-term effects and should be closely monitored.