Research shows that Generation Z adults receive financial help from their parents

New study by Bank of America revealed that almost half of Generation Z receive financial assistance from their parents.

The study, titled “The Parent Trap,” released July 10, found that 46% of Gen Zers, ages 18 to 27, still depend on their parents for financial help because they don’t earn enough money and blame the rising cost of living. The Better Money Habits research team found that 52% of survey participants admit they don’t earn enough to keep up their lifestyle, with many pushing aside vital accomplishments. More than half of survey participants say they don’t have enough emergency savings to cover three months of expenses.

While some say they’re working on them, 50% say they will not be saving to develop into homeowners, 46% don’t have any retirement savings, and 40% will not be on the right track to start out investing. However, some are adjusting various changes to offset inflation.

Forty-three percent are cutting back on eating out, and 24 percent are shopping at more cost-effective grocery stores. Twenty-seven percent are cutting out events with friends as a part of a brand new trend called “budgeting out loud,” which involves telling friends which events they’ll and might’t afford.

Bank analysts call this strategy “trading down” to combat rising costs, something more Gen Z and millennials are doing in hopes of achieving financial freedom. “Despite the obstacles posed by the cost of living, younger Americans are demonstrating discipline and foresight in their saving and spending patterns,” said Holly O’Neill, president of Bank of America’s retail banking business.

“It’s critical that we continue to support Gen Z in achieving financial health and achieving their long-term goals.”

The path to financial freedom is straining the bank of mom and pop. Fifty-four percent of Gen Z adults still live at home and don’t pay rent. Of the 46% who do, nearly two-thirds say they spend greater than 30% of their monthly pay on housing. Two in ten report greater than 51% of their monthly pay goes to housing costs.

According to “loud budgeting” It is effective in late teens and in people in their 20s.some who’ve trouble adhering to strict financial boundaries. It also helps them create healthy boundaries inside their friend groups, as 63% now not feel pressured by friends to overspend.

Most Gen Z respondents said they feel prepared to tackle financial basics with some lifestyle changes. Seventy percent now follow a budget, and 66% are working on higher credit management.