Quite often, it's their kids
New research from the Employee Benefit Research Institute (EBRI) See the exceprt from the Retirement Confidence Survey here.
Providing financial support and unpaid care may be one reason why many Americans have trouble saving for retirement. In fact, the RCS finds that 3 in 10 workers and 2 in 10 retirees report they are currently providing financial support to a relative or friend.
Among workers providing support, it’s primarily for their kids; 38 percent say they are providing financial support to an adult child (age 18 or older) or to a minor child (under age 18). Among retirees providing support, well over half (58 percent) say they are financially supporting an adult child, while almost a quarter (24 percent) are supporting a grandchild. The RCS also asked about individuals providing unpaid care to help with the personal needs or household chores of a relative or friend, such as managing a person’s finances, arranging for outside services, or visiting regularly to see how they are doing.
Twenty-three percent of workers and 16 percent of retirees responded that they did so. Among those who do provide unpaid care, more than half (53 percent) of workers do so for a parent or parent-in-law; among retirees, that number is 28 percent. While retirees are often thought of as providing this type of care for their spouse, just 5 percent of retirees and 4 percent of workers name their spouse as a recipient of their care. The highest percentage of those who provide unpaid care do so for less than nine hours a week (42 percent of workers and 37 percent of retirees).
Excerpt from the Retirement Confidence Survey Fact Sheet #7 :
Financial Suport and Unpaid Care Provided by Americans
The 25th annual Retirement Confidence Survey (RCS) asked questions about some potential barriers in building up assets or maintaining them. In particular, the amount of financial support provided for relatives or friends and the amount of unpaid care provided for them as well.
Financial Support for Relatives and Friends
Families obviously must meet the financial obligations of the immediate household, but sometimes they are also called on to support relatives and friends. Three in 10 (29 percent) workers and 2 in 10 (20 percent) retirees report they are currently providing financial support to a relative or friend. Among those who provide financial support, the most common recipients are:
Workers Retirees
A child age 18 or older 38% 58%
A child under age 18 37 10
A parents or parent-in-law 22 5
A grandchild 6 24
Providing Unpaid Care for Relatives and Friends
In addition to providing direct financial support to relative or friends, an individual could also provide some type of unpaid care that can take an emotional toll on individuals as well as drawing time away from activities that may be more pleasurable or profitable. Many times this unpaid care can also result in indirect costs such as car expenses.
The RCS asked individuals if they currently provided any unpaid care to help with the personal needs or household chores of a relative or friend. This could include managing a person’s finances, arranging for outside services, or visiting regularly to see how they are doing. Twentythree percent of workers and 16 percent of retirees responded that they did so.
Among those who provide unpaid care, the most common recipients are:
Workers Retirees
A parent or parent-in-law 53% 28%
A child age 18 or older 10 22
A brother or sister 10 13
Some other relative 15 13
A friend 13 11
A grandchild 4 13
While retirees are often thought of as providing this type of care for their spouse, just 5 percent of retirees and 4 percent of workers name their spouse as a recipient of their care. While the highest percentage of those who provide unpaid care do so for less than nine hours a week (42 percent of workers and 37 percent of retirees), sizable percentages provide this care for nine or more hours a week (5 percent of workers and 18 percent of retirees providing unpaid care are unable to estimate the number of hours) (Figure 1).
