Parents face high costs to finance '˜Peter Pan' generation living at home

A 'Peter Pan' generation of young adults who are yet to move out of the home they grew up in is costing parents an extra £1.2 billion a year collectively, a report estimates.

Gareth Fuller/PA Wire

Parents with grown-up children who are still living at home spend an extra £456 on them a year compared with “empty nesters,” according to the Centre for the Modern Family think-tank, which has been set up by pensions provider Scottish Widows.

Researchers found as well as shouldering the cost of their child’s basic bed and board, parents in Yorkshire and the rest of the country are also forking out for services used by their adult children such as Netflix, as well as for their mobile phone bills, holidays, haircuts, clothing and even beauty treatments.

Sign up to our Business newsletter

Sign up to our Business newsletter

The study found those with children over 18 who are still living under their roof are spending £122 a month typically on their grown-up children, while, the average amount parents living in the North spend on their children a month is £130. Nationwide parents pay out £84 a month to help those who have left home - adding up to annual difference of £456 a year.

Those behind the study say if the findings were projected across the UK, this would mean parents with a “full nest” of adult children are spending £1.2 billion more on their offspring compared to parents whose children have flown the nest.

One in five - 20 per cent - of full nesters think their children would not be able to cope financially if they did not give them money, compared with 8 per cent of empty nesters.

Anita Frew, chairwoman of the Centre for the Modern Family said: “While it is heartening to see that the UK’s families are so willing to support one another, we are in danger of nurturing a Peter Pan generation of children who are reliant on their parents well into adulthood for all types of spending - which could have a major impact on parents’ finances for later life.”

In the North researchers found 24 per cent of parents don’t expect to get any of the money they have lent to their children back - compared to a UK average of 26 per cent.

The research among more than 2,000 people found one in five full nesters nationwide are still paying their child’s phone bill, while 19 per cent are paying for them to go on family holidays, compared with 8 per cent of empty nesters.

Ten per cent of full nest parents reported paying for subscriptions such as Netflix for their adult children, compared with just 1 per cent of empty nesters.

The “bank of mum and dad” is also footing the bill for personal maintenance for adult children still living in the family home, with 15 per cent of full nest parents nationwide paying for haircuts and beauty treatments. Nearly a quarter of full nest parents are still buying clothes for their adult children.

Some 13 per cent of full nest parents believe helping their children financially will have an impact on their retirement plans.