An analyses on multigenerational households, based on data from an in-depth poll NEFE conducted in 2024 on multigenerational households. Read the survey summary or about the family make up of multigenerational households.
Introduction
Multigenerational households often face many of the individual expenses of a traditional household, but instead of facing them sequentially just all at the they can overlap or even happen all at the same time. Some of these expenses include childcare costs, disability care, costs for aging parents, and financial assistance for adult children and grandchildren, just to name a few. While none of these financial stressors are specifically unique to multigenerational households, handling them simultaneously introduces unique barriers to financial well-being. Introducing measures to alleviate the financial burdens of multigenerational households would positively impact all households that are feeling these different financial pressures.
Professional Childcare
Of the 230 adults in our sample with children under 13 years old living at home, 66% are the primary caretaker. Seventy five percent of females report being the primary caretaker compared to 54% of males, and our analysis shows with statistical significance that females are 17% more likely to be the primary caretaker. Additionally, 14% say their partner or spouse is the primary caretaker and 18% share caretaking responsibilities. 2% rely on family and friends, and 0% (1 respondent) pay for in-home childcare.
Paying for professional childcare is one of many financial obligations that some multigenerational households face. About two in five (39%) respondents who have children under the age of 13 years old at home pay for professional childcare in some capacity, while 61% do not pay for any professional childcare. According to the Federal Reserve’s data on Economic Well-being of U.S. Households in 2023, nearly three in ten parents living with children under the age of 13 years old used paid childcare. Our findings are similar, and it could suggest that those with multigenerational caregiving responsibilities are relying on paid childcare at a slightly higher rate due to their other familial obligations. Of those who pay for childcare, the average spend is $320 per week (median spend = $200), while the Federal Reserve similarly finds that the median monthly amount for all families paying for childcare is $800. As of 2019, childcare expenses amounted to 35% of low-income families’ earnings, and the costs have continued to rise. Childcare costs have more than tripled since 1990, which outpaces wages, groceries and housing, pushing an estimated 134,000 families into poverty each year. Without large-scale policy action on this issue, Americans will continue to cite childcare costs as their main reason for not having children.
Expenses for Adult Children or Grandchildren & Parents or Other Adults
Three hundred and ninety-six adults report providing help, care, or financial support to adult children or grandchildren. Of those, 78% report providing some type of financial assistance in the last 12 months. 44% help with living expenses, 25% with transportation-related expenses, 47% provide a place to live, 23% provide insurance coverage, 22% provide supplemental income or spending money, 17% help with paying medical expenses (including professional care), 13% aid in paying back loans, 17% help with managing financial emergencies, 13% help with paying credit card debt, 6% have assisted with a down payment for a home, and 10% report providing some other financial assistance.
We asked 450 adults in our sample who provide support to an adult relative or friend to self-report approximately how much they spend per month on providing care or financial assistance to their parents, adult children, or other adults in their lives they support. Respondents report a median expenditure of $500 (mean = $889) a month supporting them. We find that respondents in rural areas report a higher monthly average spend on supporting others ($1038) than those in urban ($834) or suburban ($855) areas, though the median amounts reported vary less (rural = $500, suburban = $500, urban = $444). When comparing across race and ethnicity, we find that multiracial adults are self-reporting the highest expenses per month at $1639 (median = $900, n = 30), followed by Black adults with a monthly average of $963 (median = $400, n = 58), Asian adults $951 (median = $600, n = 38), and Hispanic adults $882 (median = $500, n = 88). White adults report spending the lowest per month on providing care or financial assistance to adults in their lives they support averaging $815 (median = $500, n = 306). Financial assistance for these adults adds an additional layer of financial burden on multigenerational households, and many families are juggling these expenses alongside others.
Costs to the Caregiver
Providing caregiving and financial assistance often comes at a cost to the caregiver. Seventy three percent of all respondents in multigenerational households report their caregiving or financial responsibilities to others have required them to do things they otherwise would not have.
Forty percent have provided emotional support they otherwise would not have. Twenty two percent have had to ask the adults they support to help out financially in some way, 20% have taken out credit card debt they otherwise would not have, 16% report taking on other personal debt, 13% have made an unplanned withdrawal from a retirement fund, 19% have delayed a life event, 11% have helped raise children who were not their own, 14% had to return to work or take an additional job, and 7% have delayed retirement. Respondents aged 50-64 years old report the highest instance of delaying retirement at 11%.
Adults in multigenerational households are facing unique barriers to financial well-being due to their economic circumstances. Just 16% say their own financial life has turned out “better than expected,” while 38% say it is “about what they expected” it to be and 46% say it is “worse than expected,” Comparing these results to NEFE’s 2024 Financial Well-being poll, 22% of all U.S. adults say the current quality of their financial life is “better than expected,” 46% say it is “about what they expected” and 31% say it is “worse than expected”. Adults in multigenerational households face financial lives that are “worse than expected” at a rate that is 15 percentage points higher than the general population, while they report a “better than expected” quality of financial life at a rate that is 6 percentage points lower than the general population. Adults in multigenerational households are feeling the financial effects of their responsibilities heavily.
Within a multigenerational household, caretakers and their partners experience different stressors. Forty six percent of adults who report being the primary caretaker in their family, and 54% of those who share caretaking responsibilities say their quality of financial life is “worse than expected” compared to just 17% of those who report their partner being the primary caretaker. Additionally, 25% of primary caretakers report taking on personal debt they otherwise would not have as a result of their responsibilities, compared to 16% who share caretaking responsibilities and 13% who say their partners are the primary caretakers. There are certain costs that primary caregivers are feeling more than others, and these are often tied into their role as the main caretaker of the household.
Those who report their partners as primary caretakers are more likely to make an unplanned withdrawal from a retirement fund (22%) compared to primary (12%) or shared (8%) caretakers. They are also most likely to return to work or take an additional job (30%) compared to primary (18%) or shared (24%) caretakers. Despite these additional financial stressors, they remain the least likely group to report a worse than expected quality of financial life. Although they may not be making sacrifices when it comes specifically to caregiving, they are often making financial sacrifices that affect both their personal and familial financial well-being.
Conclusion
While all adults in multigenerational households are experiencing pressures due to their multigenerational responsibilities, we have evidence that different degrees of caretaking are more likely to feel certain effects. Primary caretakers are more likely to take on additional debt and have lower quality of financial life, while their partners are more likely to withdraw from retirement accounts and work more than they planned to. Those that share caregiving responsibilities often feel some combination of these stressors. Regardless of an individual’s exact role within their multigenerational household, they are still feeling a multitude of financial barriers at once.
The pertinent expenses and financial barriers discussed are not specifically unique to multigenerational households; they affect nuclear families and single-parent families as well. What makes their stressors unique is that these obligations are happening simultaneously, across multiple generations. These results should focus our attention on the unique impact of multigenerational and complex caregiving responsibilities on household financial well-being. Individuals and families navigating these responsibilities are often more vulnerable to economic and financial shocks and are more directly exposed to increasing healthcare, housing, and childcare costs. In addition, our data show that, for some families, managing caregiving costs can have direct financial implications that may hinder asset building in ways that might reduce future financial security. These implications point to the importance of robust social and material supports that specifically help families manage the cost of caregiving and expanding access to savings and asset building products like state sponsored child and retirement savings accounts that reward long-term financial planning.
