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How Millennial Parents Raise Kids Without Risking Their Own Financial Future

January 19, 2017

TD Ameritrade survey reveals grandparents are the secret; providing time and money to the tune of $253 billion each year

OMAHA, Neb.--(BUSINESS WIRE)-- Millennials, the generation following a less predictable path than their parents, are now parents themselves. Approximately 26 million Gen Y-ers are raising kids today, and the number is expected to grow exponentially over the next several years. These bundles of joy certainly don’t come cheap, with the U.S. Department of Agriculture estimating the cost of raising a child to age 18 at $233,610 – and that doesn’t even include college expenses. It’s no wonder that 58 percent of Millennial parents are stressed about earning enough to support themselves and their families. Faced with record-high student debt and stagnant wages, many millennial parents are grateful for a helping hand from their own parents.

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TD Ameritrade Millennial Parents Survey. (Graphic: TD Ameritrade)

TD Ameritrade Millennial Parents Survey. (Graphic: TD Ameritrade)

The TD Ameritrade Millennial Parents Survey examines the financial habits and attitudes of millennial parents, taking into account the monetary and non-monetary support they receive from their own parents. The survey finds that, on average, each millennial parent with a living parent receives approximately $11,011 per year in combined financial support and unpaid labor from their parents, including those who receive zero support. Across America, this totals $253 billion each year.

“Our survey reveals that millennials are becoming parents with eyes wide open to the financial implications of raising a child and most are diligently planning and saving for these costs in advance of starting a family,” said David Lynch, managing director and head of branches at TD Ameritrade, Inc.1 “Millennial parents are not too proud to accept help from their own parents and, as a result, they may be more likely to stay on-track with their long-term financial goals like retirement and college savings.”

The survey of 1,000 U.S. millennial parents also found:

Nearly half (48 percent) of millennials have delayed parenthood until they were financially secure. Twice as many millennial parents as grandparents (24 percent vs. 12 percent) strongly agree that they waited until being financially secure before having children.

Millennials would have a third child, were it not for the expense. If money were no object, they would have one more child, on average (three instead of two).

More than half (54 percent) received financial support from their parents in the past year. Single parents were more likely to receive parental support than those in two-parent households (63 percent vs. 52 percent).

Fifty-six percent of millennial parents are grateful for the financial help, while a quarter (26 percent) feel embarrassed. Women are more likely than men to feel grateful (63 percent vs. 49 percent).

Three in 10 (30 percent) get help from “granny nannies.” Millennials with parents who provide primary childcare receive 14.3 hours per week, and those with parents providing back-up childcare receive 9.2 hours per week. Grandparents’ help with childcare and other unpaid labor can save parents up to $300 per week.

The survey also included 1,000 U.S. grandparents with millennial children and found:

Forty-eight percent of grandparents say their adult child is not completely financially independent from them. However, five percent have an adult child who is completely financially dependent.

Three-quarters say they are glad they’re able to provide financial support despite the fact that 47 percent have had to make some financial sacrifices to help an adult child.

Half (49 percent) of grandparents see this assistance as temporary. However, nearly one in 5 (18 percent) grandparents expect to continue providing financial support to their adult child for the rest of their life.

The youngest and/or female adult child gets the most help. Four in 10 (41 percent) grandparents with more than one adult child say that the most financial support goes to their youngest child, and the same number say the most goes to a female child.

“So what’s a good parent or grandparent to do? Work together to set clear limits and expectations for financial support and child care and discuss the tradeoffs to make the support possible,” said Lynch. “Both generations can start planning for the future today by setting financial goals. Putting in the time now can help establish a clear vision of what financial well-being looks like down the road whether your dreams include sending a child to college or retiring on the beach.”

About TD Ameritrade Holding Corporation

Millions of investors and independent registered investment advisors (RIAs) have turned to TD Ameritrade’s (Nasdaq: AMTD) technologypeople and education to help make investing and trading easier to understand and do. Online or over the phone. In a branch or with an independent RIA. First-timer or sophisticated trader. Our clients want to take control, and we help them decide how – bringing Wall Street to Main Street for more than 40 years. TD Ameritrade has time and again been recognized as a leader in investment services. Please visit TD Ameritrade's newsroom or www.amtd.com for more information, or read our stories at Fresh Accounts.

1 TD Ameritrade, Inc. is a broker-dealer subsidiary of TD Ameritrade Holding Corporation.

Brokerage services provided by TD Ameritrade, Inc., member FINRA (www.FINRA.org)/SIPC (www.SIPC.org).

About Head Solutions Group

Head Solutions Group (U.S.) Inc., is a leading market research partner for Financial Services companies in North America. With offices in New York, Toronto and Montreal, Head delivers the deep customer insights that increase institutional knowledge and propel business action. TD Ameritrade and Head Solutions Group are separate and unaffiliated firms and are not responsible for each other’s services or policies.

About the 2016 Millennial Parents Survey

A 18-minute online survey was conducted with 2,018 American adults (half millennial parents age 19-37, half grandparents age 50-70 with adult children) by Head Solutions Group, between Oct. 20 and Oct. 26, 2016, on behalf of TD Ameritrade Holding Corporation. The statistical margin of error for the total sample of N=2,018 American adults within the target group is +/- 2.1 percent. This means that in 19 out of 20 cases, survey results will differ by no more than 2.1 percentage points in either direction from what would have been obtained by the opinions of all target group members in the United States. Sample was drawn from major regions in proportion to the U.S. Census.

Source: TD Ameritrade Holding Corporation

Source: TD Ameritrade Holding Corporation

TD Ameritrade Holding Corporation

For Media:

Rebecca Niiya, 402-574-6652

Sr. Manager, Corporate Communications




For Investors:

Jeff Goeser, 402-597-8464

Director, Finance and Investor Relations


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