Legal & General Group: 1+ Million U.S. Moms and Dads Compromise Their Golden Years To Help Kids Buy Their First Home

  • 54% of U.S. parents and grandparents drained cash savings to help younger family members purchase property
  • 7% postponed retirement, 15% reported lower standard of living, 14% felt less financially secure
  • 48% made gifts or loans without getting professional advice

NEW YORK--()--In 2018, over a million parents and grandparents in the U.S. ponied up $41 billion to help the younger generation buy a first home—54 percent of which came out of their cash savings for retirement. Almost one in six of these ‘Bank of Mom and Dad’ (BoMaD) lenders are accepting a lower standard of living, according to research sponsored by Legal & General Group. The recently released study found that more than a quarter (29 percent) of U.S. parents and grandparents surveyed have provided financial assistance to children and grandchildren purchasing property. However, more than one in every six (15 percent) believe they are financially worse off as a result; and 14 percent also said they feel their financial future is less secure. To round out this worrisome picture, 7 percent of BoMaD lenders had postponed retirement after helping family or friends get onto the housing ladder, 39 percent of these by 3+ years.

Legal & General Group Chief Executive Nigel Wilson commented, “The Bank of Mom and Dad is playing a major role in the U.S. housing market, but the generosity and support many people choose to provide family members is compromising their own quality of life. This generation is helping kids and grandkids purchase property throughout the country, but it would appear that many don’t really have sufficient wealth to do so without impacting their own retirement plans. It’s disturbing to see that some Moms and Dads have even had to postpone retirement in order to help.”

The number of ‘lenders’ accepting a lower standard of living was higher among those in the Mid Atlantic states, with over a quarter of respondents from this region also feeling less financially secure. Despite this, BoMaD lenders still help younger family members navigate the property market, using savings or, as 15 percent of respondents reported, taking out loans to do so.

Other sources of funding that BoMaD lenders have used, or would consider using to assist family members, include raiding either their IRAs or their 401(k)s (8 percent each). Seven percent refinanced their homes, and 6 percent downsized to a smaller property themselves. Having reached a deserved stage of rest after a long life of work, and in many cases having already substantially helped their kids through college, 5 percent even came out of retirement to help their kids toward a lifestyle they may have come to expect growing up in the relatively greater affluence of previous decades.

The BoMaD study also found that lenders—operating on an emotional basis—were unlikely to take professional advice when helping their kids and grandkids financially. Before gifting or loaning the money, nearly half of respondents (48 percent) didn’t or wouldn’t seek any professional advice about their choices. “Whatever the source of funds, only a quarter of BoMaD lenders sought advice before they helped their kids financially. That number is surprisingly low—as an industry, we should encourage more people to seek advice to make sure helping younger family members won’t leave them short of money in later life or concerned about their own financial future,” L&G’s Nigel Wilson noted.

Other key findings from Legal & General’s “Bank of Mom and Dad” research include:

  • 37 percent of BoMaD lenders give the money outright, meaning they don’t expect to recoup any of it; an additional 33 percent provide a loan with no interest
  • 23 percent of parents and grandparents helped first-time buyers, while 4 percent helped those upsizing
  • Those unable or unwilling to help family members financially cited 3 main reasons:
    • Low income (25 percent of respondents)
    • The belief that family members should be self-reliant (20 percent)
    • Lack of savings (13 percent)
  • 51 percent of lenders think it’s harder for younger generations to buy than it was for them, citing out-of-sight property prices (71 percent) and incomes not increasing (63 percent)

For more information on the 2019 BoMaD U.S. study, or to see a copy of the report, please contact:

Meir Kahtan: or

Maria De Angelis:

Meir Kahtan Public Relations, LLC +1 212-575-8188


The information contained in this press release is intended solely for use by journalists, and should not be relied upon by private investors or any other persons to make financial decisions.

About the Study

Legal & General commissioned Cebr, a UK-based economics consultancy, to conduct proprietary research into the lending/giving patterns of family and friends in U.S. home purchases and college education. The BoMaD USA research was compiled using original survey data of 2,177 total respondents throughout the U.S., as well as existing data sources relating to transaction levels. The survey work was carried out by YouGov and Censuswide. For the borrowers the total sample size was 1,159 adults. Fieldwork was undertaken from September 26 - October 4, 2018. For the lenders, the total sample size was 1,018 adults. Fieldwork was undertaken from September 26 – October 2, 2018. Both surveys were carried out online. In order to arrive at the overall value of BoMaD (in terms of the value of lending) we used data from the survey to obtain the share of transactions supported by BoMaD and the average value of the assistance. This was then scaled up using Cebr forecasts for total property transactions.

About Legal & General Group

Established in 1836, Legal & General is one of the UK’s leading financial services groups and a major global investor, with international businesses in the US, Europe, Middle East and Asia. With over £1 trillion in total assets under management, we are the UK’s largest investment manager for corporate pension schemes and a market leader in pensions de-risking, life insurance and workplace pensions. We have also invested over £19 billion in direct investments such as homes, urban regeneration, clean energy and small business finance. In the U.S. alone, we provide life insurance to over one million people.


Sophie Placido/Nick Seymour/Hannah Polson
+011 33 020 7440 8670


Sophie Placido/Nick Seymour/Hannah Polson
+011 33 020 7440 8670