WATCH ABOVE: We’re getting new insight about how Canadians families are weathering the economic downturn. More and more young adults are turning to their parents to help pay the bills. As Eric Sorenesen reports, that’s not how many Canadians planned to spend their nest egg.
Adult children are draining their parents’ retirement nest eggs, a new poll released Wednesday suggests.
The CIBC survey found that two-thirds (66 per cent) of Canadian parents polled said they’re feeling the financial strain of supporting their adult kids. (Adult children were defined as those 18 years and older, not attending school.)
One in four parents polled said they’re spending more than $500 a month to help cover the costs of expenses like rent, groceries and cellphone bills for their grown children. Free room and board was the most common expense, with 71 per cent saying it’s one way they cover the costs of their adult kids.
Meanwhile, paying for their adult kids’ living expenses is derailing parents’ financial plans — nearly half (47 per cent) said their ability to save for themselves has been hampered, and 20 per cent said it’s delayed their retirement.
Often, parents want to help their kids. But experts say helping out your children shouldn’t come at the expense of your own financial well-being.
WATCH: More and more young adults are facing financial difficulty and that’s putting a strain on their parents’ pocketbooks. Lama Nicolas speaks with a 30-year-old woman who has no choice but to live at home with her parents. Experts warn parents should have a financial plan.
“Parents may have the will to help their adult kids but they may not always have the means,” said Christina Kramer, executive vice president of CIBC’s Retail and Business Banking.
Kramer said while living at home temporarily can help young adults save for their future, “these extra costs can be a burden that delays or prevents parents from meeting financial goals such as retirement.”
WATCH: The best way to save for your retirement
The survey of 1,054 randomly selected Canadian parents was conducted two weeks ago. It’s considered accurate within plus or minus three percentage points, 19 times out of 20.
With a file from The Canadian Press