Maggie Aronoff watches her daughter “put every penny” toward rent, groceries and gas — but still come up short at the end of the month.
To help her, the Mission woman has started giving her $1,500 a month to help with housing.
“I’m fortunate I can do it,” she says. “But what I’m not able to do is save for retirement.”
Instead, Aronoff, who is 58, is planning to work until she’s 70.
She accepts that the next decade will be tough. She doesn’t travel or buy new things and struggles to maintain her property. But she wants to give her daughter, a university student, the “best fighting chance she can have.”
As the costs of living and housing have risen across B.C., several studies show more parents are providing support to their adult children, and societal norms — such as when parents choose to retire or how long adult children live at home — are changing.
“If you mix in the impacts of an aging population, population growth and international migration, you really start to see expectations starting to shift,” said Andy Yan, director of the City Program at Simon Fraser University.
That can come with challenges.
Experts worry some parents may be stretching their own finances to help their kids with rising costs while, on the flip side, adult children who need help, or who live with their parents, may face stigma or struggle to assert their independence.
And if family support becomes the new norm for young adults trying to become established, what does that mean for those who don’t have it?
“The key is how much of it is done to simply survive, and how much to thrive?” said Yan.
Retirement, delayed
In 2023, according to Statistics Canada, the average Canadian retired at 65, on par with the retirement age in 1977, but up from 61 in 1998.
A recent report published by Fidelity Investments Canada found six in 10 retirees, or 59 per cent, financially supported their adult children in some way: 25 per cent helped with day-to-day living expenses, 21 per cent helped with large purchases, such as a car or wedding, 20 per cent let kids live at home rent-free, 16 per cent helped with purchasing a home, 12 per cent contributed to their grandkids’ education, and nine per cent helped with rent payments.
But when surveyed, only four in 10 pre-retirees said they expect to help their adult kids after they retire.
The gap between retirees who are supporting their kids and pre-retirees who expect to do so is a red flag for the report’s co-author, Michelle Munro, Fidelity’s director of tax and retirement research.
“That 20 per cent gap means some people aren’t planning for it,” she said. “There’s a real risk here for retirees on a fixed income.”
Older Canadians aren’t immune to the rising cost of living, and “end-of-life costs can be incredibly expensive,” said Munro. If parents want to provide financial support for adult children, but haven’t factored it into their retirement plans, it could put them in a precarious situation down the road.
The Fidelity report found that 63 per cent of pre-retirees anticipate working in some form during their retirement. Children appear to be a factor in that decision, with 74 per cent of those who expect to support their kids saying they are likely to keep working.
Mason Cox, director of counselling at the Credit Counselling Society, said he’s spoken to people who want to help their kids, but aren’t sure if they can. He helps them determine their financial goals before making decisions.
“Some people don’t mind working,” he said. “They want a little extra money for security, or for a vacation. Others say I can work two more years to help my child with a down payment and then I won’t have to take that out of my retirement funds.”
Parents need to be comfortable with the trade-offs they might have to make to help their children, particularly if they decide to change their retirement plans, he said.
Munro advises families to have candid conversations. Planning can help both sides clarify the expectations for support both given and received, she said, including what might happen if parents draw down their savings to help kids get established, but then need assistance later on.
Financial planner Alim Dhanji echoes the importance of a plan to help parents decide how to help their children, as it can cause problems if their support eventually “compromises their retirement.”
Working through possible scenarios, such as how parents might afford their own care if needed, can reduce their financial stress, said Dhanji, who works with Assante Wealth Management in Vancouver.
Ripple effect of home ownership
Marty van den Bosch began laying the groundwork to help his son enter the housing market in 2015, when the boy was six. That year, the family moved from New Westminster to Chilliwack and bought a home that could be renovated to include a self-contained apartment where his son can eventually live.
Van den Bosch’s son is now 14 — “it goes fast,” he said — and the new suite is occupied by a family from Ukraine.
“For us, it wasn’t a financial burden. It was more about eventually taking away some of my son’s financial burden,” he said.
A pair of studies recently released by Statistics Canada based on 2021 census data found strong links between parents’ “housing wealth” and their children’s ability to purchase a home.
Researchers determined people born in the 1990s were twice as likely to own a home if their parents were homeowners, compared to those whose parents were not.
British Columbians earning more than $80,000 saw a 21.3 per cent gain in the ownership rate if their parents owned one or more properties.
A second report found that one in five, or about 20 per cent, of residential properties owned by British Columbians born in the 1990s are co-owned with their parents.
Researchers concluded that inequality of home ownership appears to be “reproduced across generations,” with parental home ownership bringing their children big financial advantages.
“This has led to a growing concern about intergenerational inequality and the rise of an ‘inheritance culture,’ ” they wrote.
Yan cautioned against assuming all parents are in a financial position to help their adult children, and that all families are close.
“As some families rally together, some fall apart,” he said. “It’s the falling apart that you never hear. The idea of generational wealth assumes a certain relationship with your parents and siblings.”
Trying ‘so hard’
Janet Cox calls her adult daughter her best friend. She decided to give her daughter an inheritance early by allowing her to build her own home on Cox’s Mission property. She said it’s one of the best decisions she’s made.
“I have the benefit of her company, but we live independently,” said Cox, who is a senior. “We help each other out.”
Cox is quick to add that her daughter is a “hard, hard worker,” who paid to build her own home. “My gift to her was the land, by putting her on title.”
Financial planner Kelly Ho said some adult children still feel an unnecessary stigma about living with their parents.
“If young adults stay at home longer to save money, they may be able to become independent sooner. It’s better to boomerang than to be in debt,” she said, referring to children who move out of their parents’ home and then return.
“Society paints a picture of what life should look like, but there should be no shame. Each situation is unique. I think people have to get over that perceived stigma.”
In interviews with 26 young adults who live with their parents, UBC PhD candidate Umay Kader has identified several reasons adult children remain at home. The decision is typically tied to finances, but precarious employment, prolonged education, past unstable relationships or fragile housing situations may also play a role, she said.
As Kader analyzes the information she’s collected as part of her project, she’s more interested in the how, rather than the why. How does it look when an adult child lives with their parents?
In 2021, 35 per cent of Canadians ages 20 to 34 lived with at least one of their parents, according to Statistics Canada.
While that number hasn’t jumped since 2016, it has steadily increased over the previous decades, rising about five percentage points between 2001 and 2021.
Kader said many of the young adults she interviewed were very aware of notions of millennial entitlement and a “failure to launch.” In some cases, that made them more likely to assert their agency, to “prove to their parents that they are doing something with their lives,” she said.
Many said their parents had suggested the living arrangement.
“Some say, why struggle financially when you can stay here and save up?” she said.
The sociologist also uncovered challenges. Old power dynamics sometimes persist between parents and children, with some kids feeling like they’re “walking on eggshells.”
Probably most disturbing was the discovery that many of the adult children viewed their living situation as part of a transition period, which led them to put some of their dreams and desires on hold, said Kader.
They might be doing all the things they think they should in terms of being independent, but struggled with feeling unseen or overlooked.
The researcher also identified several benefits to living at home as an adult, including greater empathy and the opportunity to get to know parents in a different way.
Reframing relationships
Adaptability is an important word in Lindsay Beal’s household these days.
With four generations under one roof, there is a constant reframing of roles and relationships, she said.
Beal, who is approaching 60, lives in an upstairs suite with her husband and her mother, while her daughter and 18-year-old grandson live downstairs.
They bought their house in Victoria in 2006 after renting for several years. When their landlord decided to sell and they couldn’t find a new place to rent, they realized it was more affordable to pool their resources and buy a house.
Beal said her daughter started out contributing $1,200 to the mortgage payments, but that has since gone down to $500 as the cost of living has increased and her income has not.
Beal, who is completing a PhD in inclusive leadership at the University of Victoria, hopes to continue working until 70.
Her mother has been a big help to the entire household as the cost of food has risen, but she worries about her grandson, who has struggled to find work.
“I think it’s double-edged, the benefits and challenges of living in a multi-generational household,” she said. “There’s a lot of angst about the future. Today’s youth are facing a really difficult time and it’s hard to witness.”
She recognizes that high housing costs mean her grandson will need to assert his independence while living in his childhood home.
“We need to change our way of doing things, shift our way of interacting, to allow that change. We need to move with flexibility to allow him to establish himself as an adult,” she said.
