The Jewish parents propping up the bank of mum and dad

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According to the Institute of Fiscal Studies (IFS), the proportion of 25 to 34-year-olds who live with their parents has risen by more than a third over the past two decades, an increase that’s happened in tandem with the rising cost of property.

In 1995-96, 65 per cent of those aged 25–34 with incomes in the middle 20 per cent for their age – in today’s terms, that’s £28,000 to £40,000 – owned their own home; 20 years later, that figure was just 27 per cent.

Geoffrey Hollander, a north London accountant, works with many Jewish families where parents are financially supporting adult children and he has noticed a particular social pressure among Jewish parents to help their kids get a leg up.

“I think that in the Jewish community there is a slightly higher expectation from children that parents will do their best to help,” said Hollander. “Many parents want to help, whereas outside of the community, there isn’t necessarily that expectation or that willingness in both directions. We’re very family-orientated, so parents want their kids to do well and will possibly put in more financially to ensure that.”

Susan has noticed the same, but feels that expectation can be compounded in close-knit Jewish communities where pressures to support your kids can feel akin to “keeping up with the Joneses”.

“There are a lot of Jewish spaces where the total expectation is that you have quite a bit of money,” she says. “The stories you hear are, ‘this child has moved out and this child is living in this flat and this child is getting married,’ and you feel a bit judged and a bit anxious because you’re not giving your children the same level of financial help to do those things. But then at the same time, I don’t want my kids to be spoilt babies.”

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Mark Bogard, CEO of the Family Building Society, works with families across generations to help them make the most of their money. Through ongoing focus groups with young adults and their parents, Bogard determined that access to the “Bank of Mum and Dad” is not just a privilege of the wealthy, but an increasingly universal necessity for young people across demographics.

“If you look at the price of a home particularly in London and the South East, and what people are generally being paid between the ages of 25 and 30, it’s not possible to do it on your own without help,” Bogard says.

In 2018, the Family Building Society collaborated with the London School of Economics on a research project exploring how the “Bank of Mum and Dad” really functions for families in the UK and found that it runs adjacent to another dependency: the “Hotel of Mum and Dad”, which parents like Susan open up to help their kids cut costs in an extortionate rental market.

“It was just becoming impossible to save money,” says Patty*, 66, whose 29-year-old daughter and her partner recently moved back into her Acton home.

“They felt they needed to cut their cloth a bit, put funds aside to purchase a house, and the only way they could do that was to get accommodation from me.”

Despite both having full-time jobs, Patty’s daughter and her partner couldn’t afford to keep paying rent for their Hackney flat and simultaneously save for a house.

The pair collectively pay Patty £800 in rent and split the bills. She says her daughter has been financially independent for a few years – besides occasional instances of borrowing money for “surprise costs” – and, more than anything, Patty feels sorry that the cost of living and of London properties have forced her daughter into these circumstances.

“You have to look at the world and say, ‘How else are they going to do it without my help?’” she says. “I think for a parent it’s important to think, ‘This isn’t what they want.’ They loved their life in Hackney and they didn’t want to give it up, but this is what they have to do.”

Sarah, a 28-year-old civil servant, moved back in with her parents in 2023 to save money. She found that the upsides of living in a flat of her own for a few years post-university – namely the feeling of independence – didn’t outweigh the downsides, with the cost of rent chief among them.

“All of my pay cheque was going towards rent, so even though I had the benefit of my own space, I had no money to go out and do things,” Sarah says.

At her parents’ north London flat, she pays minimal rent and has access to the little luxuries that come with living in a well-established home rather than an overpriced flat share, including occasionally being cooked for and always having comfortable familial company.

Sarah admits that because she still lives with her parents, “I don’t really feel like a 28-year-old”, but the ease that comes with their support is preferable to the unstable independence she might have without. As for future plans, she’s “playing it by ear at the moment”.

According to Bogard, the Family Building Society’s research found that among 25 to 35-year-olds there was little shame associated with financial dependence, and a significant proportion of young people would rather live comfortably at home and save money than fly the coop for the sake of a bit more social freedom – marking another distinct generational shift in values.

“When I was a kid, there was this really strong desire for independence and to get out, even if you had to move somewhere that was pretty horrible,” Bogard said. “Nowadays, kids don’t want to go and live somewhere horrible – given a choice between living nice and comfortably with your parents or getting your independence, there was a strong sense in our focus groups of, ‘I’d rather live with my parents.’”

Twenty-five-year-old Ben, who moved to Israel for a year after university before moving back into the family unit in 2022, fits that profile. Ben works as an estate agent and his pay fluctuates based on commission. Unlike a landlord, his parents are flexible about his rent payments, charging more or less depending on how much he made that month.

“It’s just way cheaper,” Ben says. “It was definitely a financial motivation.”

When it comes to planning for the future, Ben is unhurried. Is he saving for anything? “ Yeah, probably a flat or a house.” How much longer does he plan on living at home? “It depends on how much money I earn, but basically as soon as I can afford to buy a house, I probably will.” He predicts the next two to three years.

And how does Ben think his parents feel about the arrangement? “I think they’re pretty happy with it – they get to spend time with me, and I do a lot of chores around the house,” he says.

But according to Bogard’s work with parents in focus groups, they aren’t universally so thrilled about bunking with their adult children.

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“The thing that the kids don’t understand is that by the time you’re living at home and you’re 27, 28, 29, 30, your parents really want you to go,” he says.

Patty and Susan, both finding themselves not just mothers but suddenly the housemates of their adult progeny, have certainly had difficulties with the dynamic.

“I think it feels very weirdly like we are four adults sharing a house,” says Susan. “Nothing prepared me for this stage of parenting. Like, what is my role here? Am I a friend? Am I a mother?”

To deal with the blurry social boundaries that come with house-sharing among adult child and parent, Patty and her daughter have a “house diary” with a kind of “booking system” for the downstairs area, and so far – though it’s only been a few weeks – there haven’t been any issues.

“I have to keep the attitude that it’s only a short period of time that I can give this to my daughter to make a substantial difference to the rest of her life,” Patty says.

Cambridge-based father Jonathan* is trying to help his eldest son, 22, get ahead, too. In his first job after university, Jonathan’s son receives £500 a month from his parents to help with bills but has free accommodation in the Greenwich house owned by his grandparents, who live in the US.

“I don’t know how he’d possibly survive without help from his parents and grandparents on a sub-30k graduate salary,” says Jonathan. “He’s contributing towards the bills, but if he had to pay a thousand pounds or so a month, he’d be spending half his salary on rent, never mind starting to save for a house.”

Jonathan says his son is itching to move out of his grandparents’ house despite the highly subsidised lifestyle and wants to “crack on” with living independently.

“He’s not happy about it. He’s a very proud, well-educated young man – I don’t think kids want to have to ask for help,” says Jonathan. “And I think to myself, ‘God, you will be working even longer than us, you’re probably going to have to sort out your own provisions for retirement.’”

Jonathan says he’s had to relinquish a bit of the “tough it out” mentality he grew up with, given the dire set of financial circumstances young people have to make the best of.

“It is a privilege, ultimately, if you can receive help from parents, because it does put you ahead when you put it to good use,” says Jonathan. “Don’t borrow from the Bank of Mum and Dad to fund an expensive lifestyle but to make that capital work harder.”

Parents who can afford to help their children, even in small ways, are faced with a difficult and timeless conundrum: do they release their kids to the world without a crutch, hoping they’ll learn to find their feet, or offer a steady helping hand so they never fall?

The matter has been made more complex given the disparity of wealth between the baby boomer generation and those in their twenties and thirties today, whose goalposts for financial independence are so much further away than their parents’ were at the same age.

But Susan admits that the best things to have happened to her kids have been the result of their own hard work, the times they’ve been challenged to stand on their own two feet.

“My son worked from the age of about 16, and that was really good for him,” she says. “It gave him self-confidence, it gave him experience, it helped him grow up and it gave him responsibilities.”

Patty concurs: “From what I’ve seen, the kids that don’t have to do much and have a really nice safety net are perhaps not as responsible as the ones who had to get up, get out and do the job, even if they’re not that happy with it.”

But do the same rules apply in a climate where even young adults who make all the “right” financial choices – like working a full-time job, sticking to a budget, eschewing non-essential purchases – struggle to keep their heads above water, let alone begin saving for assets to call their own?

It seems young people – the fortunate ones – will have to settle into this prolonged state of financial dependence as long as salaries continue to fall short of inflation, rent prices soar and the prospect of climbing the property ladder becomes ever more implausible. And their parents will have to accept a bleak distortion of that age-old dream: to provide their child with a good life, an ample life.

At the rate things are going, they’ll be providing for a good while longer. 

*Names have been changed