Parental Financial Assistance and its Varying Consequences in the Transition to Adulthood

Monica Kirkpatrick Johnson, Washington State University

Drawing on data from the National Longitudinal Study of Adolescent Health, this study examines the impact of parental financial assistance during the transition to adulthood on young people’s well-being and relationships with parents. Conditional change models for depressed mood, self-esteem, and closeness to mother and father are estimated to evaluate the effects of parental financial assistance reported in the 3rd wave (ages 18-26) and 4th wave (ages 24-32) of the study. Findings indicate that financial assistance is negatively associated with depressed mood but positively associated with closeness to both parents. Changes in self-esteem are not linked to parental financial assistance during either period. While the observed pattern with respect to parent-child relations holds regardless of the progress young people are making in the transition to adulthood, the effects for depressed mood do not. Worsened depressive symptoms with financial assistance are concentrated among those who have moved into adult social roles.