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Key Takeaways
- When forced to choose what to sacrifice in retirement, only 15% of Americans would cut the financial support they provide to family members, making it their least preferred option out of nine difficult choices.
- Americans would rather return to work, skip medical care, or move in with others (22%) than stop helping adult children, grandchildren, or aging parents.
- For many, family obligation outweighs personal security.
When the Alliance for Lifetime Income surveyed Americans about what sacrifices they’d make to stretch retirement savings, reducing family financial support ranked dead last—chosen by only 15% of respondents. That figure is way behind having a lower standard of living (58%), returning to work full or part-time (54%), and even skipping medical care (21%).
“It’s one thing to provide financial support to family when you can afford to do so, but it’s a whole new level of commitment and sacrifice to keep doing it while risking your own future financial security or physical health,” said Jean Chatzky, an education fellow with the Retirement Income Institute and CEO of HerMoney.
More than half say that this family support is a drag on their retirement savings—a financial squeeze that many recognize is forcing them to sacrifice their own security for the needs they see in front of them today.
Why This Matters To You
When Americans say they’d rather skip medical care or work longer than cut family support, they’re revealing a system that’s forcing them into impossible choices. More than half of those providing family support have reduced or stopped their retirement savings entirely, potentially turning today’s help into tomorrow’s crisis—and creating a cycle that will trap future generations in the same squeeze.
Caught Between Generations
Many Americans are facing retirement while spending money that they could be saving on family members. They’re not doing so while being naive about the financial and economic realities they face.
The U.S. is in the midst of “Peak 65,” as more than 4.1 million Americans turn 65 each year through 2027, with over 11,200 reaching the traditional retirement age daily. Meanwhile, more Americans are now part of the sandwich generation, supporting both their parents and children at the same time.
Of those providing intergenerational support, about four-fifths provide some combination of physical, financial, or emotional help to parents, and more than three-quarters said the combined caregiving load was equal to having another full-time job on top of how much they already work.
The family pressures have been falling heaviest on Gen X—46% of them belong to the sandwich generation. For these and other reasons, 37% of Gen Xers expect to delay their retirement, and only 41% are confident that their savings will last long enough for them, compared with 62% of Baby Boomers.
The Price of Family
Supporting family members can significantly affect your own retirement security. Almost six in 10 of those surveyed by the Alliance for Lifetime Income have either cut back on or halted retirement contributions during what could be peak earning and saving years.
“This is the first generation where the overwhelming majority won’t have a pension to rely on for retirement income, and that means retirement planning is even more challenging for them,” said Jason Fichtner, executive director of the Retirement Income Institute.
Fast Fact
Many American parents are supporting young adults who are staying on their health insurance until age 26 under the Affordable Care Act. Yet 17% of Americans are financially supporting adult children age 26 and older—meaning they’re continuing to support their kids long after they lose eligibility for family health coverage.
Among those helping parents or in-laws financially, more than one-third of the surveyed individuals report that it has reduced their retirement savings or income, including over a quarter of parents who are helping adult children beyond the age of 26. About three-quarters of those surveyed said they’re struggling to balance their budgets under the weight of these multigenerational needs.
Even helping the grandkids can come at a great cost—almost one-third say doing so has substantially eroded their retirement nest egg.
The Bottom Line
Americans are stretching their finances to support their families, even when it means working longer hours, skipping medical care, or giving up other forms of personal comfort. Choosing family over savings isn’t just a financial decision—financial advisors will tell you it often defies mathematical sense—but it reveals what matters most to people facing impossible trade-offs.
Without broader changes to retirement security and other parts of the American economy, the question isn’t whether Americans will keep choosing family first—it’s whether future generations will have to sacrifice their retirement prospects while trying to care for their loved ones.
