Want to buy a house but a little short on cash? If your parents or grandparents are of the baby boomer generation then no problem, they’ll give you the cash! Well, at least one in five will according to a recent survey by Better Homes and Gardens Real Estate.
According to the survey, one in five baby boomers has already gifted, loaned or co-signed a loan to support their children or grandchildren in purchasing a home, and more than two-thirds of baby boomers want to provide this type of support in the future.
Aside from the good investment rationale, baby boomer respondents cited that the willingness to provide financial support to their children and/or grandchildren was out of love. By providing financial support to assist in the home buying process, respondents stated that they could ensure their children and/or grandchildren would benefit from their estate and fulfill a large part of achieving the American dream.
Key findings from the Better Homes and Gardens Real Estate baby boomer survey include:
- One in five baby boomers have already gifted, loaned or co-signed a loan to their children or grandchildren for a down payment on a home.
- Looking ahead, one in 10 baby boomers say they will “definitely” provide their children or grandchildren with financial support for a down payment on a home, and at least half hope to do so.
- In total, more than two-thirds (68%) of all baby boomers said they want to provide future financial support for their children or grandchildren to purchase a home.
- Those who have already provided past support are also most confident that they will do so again.
- Highest interest in providing support is reported among younger (age 45-54), more affluent (household income of $75,000+) baby boomers who have at least one adult child (age 18-34).
- Baby boomers are driven to provide financial support primarily by their belief in the overall investment value for them and/or their children or grandchildren, and the role homeownership plays in fulfilling the American dream.
- Older (age 55+) and more affluent ($100,000+ household income) baby boomers are more likely than their younger or less affluent counterparts to have previously provided financial support.
- Across prior support and future interest, baby boomers show more interest in “gifting” or loaning money; they are least interested in co-signing loans.
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