When Are Children Independent?

8/1/2021

Most parents debate as to when their children need to become financially independent.  It is a challenge to know when kids should no longer rely on parents for financial support.  Those thoughts may also change from before an individual has children, to when they have children.  Getting an idea as to when it would be suitable to consider children independent is something that most families need to consider long before that time occurs in their children’s lives.

Financial dependence can also have a significant impact on the financial lives of parents, so establishing when children need to fend for themselves financially is critical to financial stability.  This is also a topic that is helpful to include a financial advisor, as the advisor can provide some financial guidance to the children.  What age do most parents feel their children are financially independent?  Spectrem recently researched this topic with wealthy investors and found that they are fairly split on this subject.

Thirty-five percent of wealthy investors feel that a child is financial independent when they get a full-time job.  This percentage is similar regardless if an investor has dependent children, non-dependent children, or planning to have children.  Twenty-seven percent of investors feel that a child is financially independent after completing college or technical education.  Wealthy investors with non-dependent children are slightly less likely to feel that is the timeframe of financial independence, with only 23 percent indicating that it comes after completing college or technical school.  Those investors with dependent children however are the opposite, with 36 percent indicating that children are financially independent upon completing their college or technical education.

Twenty-one percent of wealthy investors indicate that children are financially independent when they are able to pay their own bills.  That number increases to 24 percent among those wealthy investors who have children, but they are no longer dependent upon them.  The completion of a post graduate program is the timeframe of financial independence for 12 percent of those wealthy investors who do not have children but plan to at some point in the future.  Marriage is the moment of financial independence according to four percent of wealthy investors.

Regardless of when financial independence occurs, families need to clearly communicate that with children and discuss with one another prior to determining the timeframe that independence needs to occur.