Gen Z Can’t Afford To Move Out Of Their Parents’ House, & An Economist Says That’s Bad News For Everyone

It turns out that the traditional way of doing life actually has its merits. It's just not possible in this economy.

Written on Oct 18, 2025

gen z son talking to his dad in the home they share LightField Studios | Shutterstock
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It’s becoming more and more common for young people to depend on their parents for financial assistance. One of the biggest ways this is manifesting is through Gen Z living at home much longer than previous generations. The old tradition of going off to college, then getting your own job and apartment while you save up to buy a home, has been disrupted by the state of the economy.

At first glance, this doesn’t seem like a systemic problem that affects everybody, but it actually is. Economist Rohan Shah, an assistant professor of Economics at the University of Mississippi and a member of the Institute for Humane Studies, explained why Gen Z’s inability to live on their own actually impacts the entire country in an article he wrote for The Conversation.

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Gen Z living at home affects everyone negatively, regardless of their stage of life.

Shah explained that because Gen Zers are living at home in increasing numbers, they aren’t meeting such a wide array of people as they would otherwise. He noted that many older adults are more likely to live in the suburbs or even rural areas instead of bustling cities full of diversity. Not only are Gen Zers exposed to fewer people because of location, but living at home also naturally provides fewer chances to socialize.

gen z woman in her bedroom at her parents' house Taryn Elliott | Pexels

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According to Shah, this could be one factor playing into Americans waiting until they’re older to settle down and start a family. “These delays might not seem important, but they can leave people feeling like they’re behind in life, which can affect their health and well-being,” he said.

Obviously, no one wants another person to experience negative psychological effects like these, but it goes beyond that. Shah said that Americans putting off having kids actually makes it more difficult for the government to fund Social Security and similar programs.

RELATED: Survey Reveals Just How Much Gen Z's Parents Spend Each Year To Support Their Adult Kids

Other experts agree that money is one of the biggest reasons people are getting married and having kids later in life.

Sociology professor Susan Brown commented on why Americans may be waiting longer to get married. “I think the bar for marriage has really ratcheted up such that now we would describe marriage as a capstone experience,” she said. “It’s something that people do after they have achieved a number of other accomplishments in life, whether that be completing their education, getting a real job, paying off or minimizing their debt, and being ready to buy a house.”

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Money also influences when people have children, Dr. Andrei Rebarber, the director of Maternal-Fetal Medicine at Mount Sinai West, said. “There probably are multiple factors that have affected this statistic,” Dr. Rebarber stated. “Pregnant people are choosing when to have their children often based on financial stability, timing of stable relationships, various personal goals, and career aspirations.”

RELATED: Bartenders Can’t Stand These 4 Frugal Things Gen Z Does At The Bar

The stunted trajectory of young adult lives could affect government programs like Social Security.

Shah said that 1.5 million more young people live with their parents now than they did 10 years ago, which can be attributed to the fact that rent has jumped approximately 4% per year, while salaries have only increased by 0.6% each year. That’s a big difference.

sad gen z woman sitting on the floor of her bedroom Sofia Alejandra | Pexels

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Alicia Munnell, Senior Adviser at the Center for Retirement Research (CRR) at Boston College, explained, “Social Security operates essentially as a pay-as-you-go operation. The cost of the system depends on how many workers there are compared to how many retirees, and when you have a big decline in that ratio, it makes it much more expensive.”

If things continue to be hard financially for younger people, it’s not exactly going to encourage them to have children. This has wide-ranging impacts far beyond just those young people. Everyone could find government services at risk because programs aren’t funded as much as they would be otherwise. This puts Americans in a precarious position.

RELATED: Gen Z Is So Broke They're Only Going On Dates For The Free Meal, Survey Finds

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Mary-Faith Martinez is a writer with a bachelor’s degree in English and Journalism who covers news, psychology, lifestyle, and human interest topics.

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