1 in 4 Teens Plans to Rely Financially on Parents Until Age 27

Teen talking about his future with father
By Mandi Woodruff

April is Financial Literacy month, which is the personal finance industry's cue to ramp up its message that high school -- and the home -- is ground zero for the movement. After all, if we can teach teens to handle money responsibly, we can ensure that the next generation of adults won't make a mess of things. Right?

Unfortunately, teens don't have quite as much faith in their own financial futures as most people, according to a new survey by Junior Achievement USA/Allstate Foundation.

Nearly 60 percent of teens said they don't expect to be ready to financially support themselves by age 24 -- a far cry from the same survey two years ago, when 75 percent of teens felt the same. Only 25 percent of teens said they'd be prepared by age 27.

That's a more than double the number in the same survey two years ago, when just 12 percent of teens felt the same.

To be fair, they have reasons to be wary of flying the coop. The job market, though slowly improving, isn't exactly stellar, the cost of college tuition is perpetually rising, and student loans rates have tripled in the last decade.
"Parents continue to be the No.1 influence on teens when it comes to money, so helping their teens set financial goals and take steps to meet them should pay off financially for both teens and their parents," said Don Civgin, president and chief executive officer of Allstate Financial.

Therein lies the central issue of financial literacy: Whose job is it to teach kids how to manage money -- their teachers or their parents?

Mom and Dad may know which snacks to pack, how to fix a flat and when to lecture about college and safe sex, but it's not like they have to pass a financial literacy test before bringing children into the world.

In a T. Rowe Price survey, more than half of parents said they only feel 'fairly' prepared to discuss finances with their children. Another 18 percent said they aren't prepared at all.

On the other hand, financial literacy is part of the curriculum in roughly half the country in the U.S. There are free financial literacy services for teens, but convincing them to learn about budgeting in lieu of playing after school sports is likely a tall order.

There's a solid case for either side of the debate. The reality is that it will likely take both.

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Probably one reason why my kids (age 28 and 30) have no desire to have any kids of their own, ever. With how things have changed recently, they probably figure they may with them until 30+.

April 07 2013 at 10:51 PM Report abuse rate up rate down Reply

Can can see living with parents after college under two conditions
1) One parent is disabled and the other parent needs help in taking of the disabled (taking to doctor's appointments, moving in and out of bed, cooking, etc)
2) There is a specific, spelled out agreement on how long the adult child can stay (i.e. has 6-12 months to find any job, put money in the bank and get an apartment), specially what chores the adult child must do (dishes, laundry, grocery showing, mowing, etc) and how much $$$ must contribute to put towards utility bills and food, BEFORE the adult child goes out and spends money on his/her own entertainment.

April 01 2013 at 6:05 PM Report abuse rate up rate down Reply

A very sad thought indeed. We could not wait to get out on our own. We did not live like our parents did but we did just fine and GREW UP.

April 01 2013 at 2:54 PM Report abuse rate up rate down Reply

Nothing says Parental Failure like a 27yo living at home

April 01 2013 at 2:51 PM Report abuse rate up rate down Reply

"1 in 4 Teens Plans to Rely Financially on Parents Until Age 27"

...and the other 3 out of the 4 will get jobs apartments and party like rock stars!

April 01 2013 at 2:41 PM Report abuse rate up rate down Reply

........1 in 4 Teens Plans to Rely Financially on Parents Until Age 27.................oh yeah ? LM@O !
not here.

April 01 2013 at 11:46 AM Report abuse rate up rate down Reply

My wife's lazy-tard daugher is in our home...she asked if we could let her live here as she did not have a job (4 year degree with bbb honors)...and I said yes. Word to the wise, get a signed agreement spelling out what their household responsibilities are to be, and once they do get a job how much they should contribute to the household costs. My utilities are up between $100 and $150 each month...and she uses up other items in kitchen, but never replaces or contributes! Hello, and now she has a job and makes $35,000 a year...GET AN AGREEMENT on the front end! This generation is LAZY...remember the mother goose rhyme about who wants to help make the cookies?

April 01 2013 at 10:28 AM Report abuse rate up rate down Reply
1 reply to HdwMan's comment

never let them BACK IN-
now why can't they double up with friends etc ?

April 01 2013 at 11:47 AM Report abuse +1 rate up rate down Reply

" Only 25 per cent of teens said they'd be prepared by age 27." That means that 3 in 4 plan to rely on their parents.
I worry about the writer's math skills and financial literacy.

April 01 2013 at 8:30 AM Report abuse +2 rate up rate down Reply
1 reply to allboats's comment

yep, The writer's numbers and words are all messed up. You would think there would be one job opening soon.

April 07 2013 at 10:55 PM Report abuse rate up rate down Reply

I'll be honest, I can't imagine this situation. I was ready to go at 17 with my first 4 years already set as I was enlisted in the Air Force through the Delayed Enlistment Program in my senior year in Dec. of 88 before graduating in spring of 89. I spent the summer with my friends and family and then headed off in Oct. of 89 and have been on my own ever since. I have had the opportunity for 3 years to help another set of parents by raising their oldest child. That child entered my home on her 13th birthday and left just before her 16th. She was far more interested with wanting technology and toys and worried about why other kids had friends for parents and wanting her parents to be friends. She refused to do her homework and when she did, she would hide it from her teachers and do her most to just keep delaying turning it in. She is two years behind now as far as I know now. Has no plans for her future and is the point that no branch of the Armed Forces will even look at her.

April 01 2013 at 5:05 AM Report abuse rate up rate down Reply

The next generation entering the workforce have many obstacles to overcome, one big one is being able to effectively communicate verbally and in person, another is indeed that they are actually responsible for their own financial responsibilities and well being.

March 31 2013 at 9:26 PM Report abuse +4 rate up rate down Reply