DENVER (KDVR) — A new survey shows a good chunk of younger Coloradans in their twenties are turning to ‘The Bank of Mom & Dad’ to help pay their bills during the pandemic.
Traditionally, these sorts of personal loan requests would be used on non-essential purchases, such as vacation money. But this time, that’s not the case.
The data, collected by USAWillGuru.com, shows in 1 in 4 young Coloradans between the ages of 20 and 29 are turning to their parents more when it comes to accessing credit and cash during the pandemic.
It’s a trend that started well before the pandemic, according to experts.
“I’m not surprised at all,” said Dr. Christina Huber, a professor of economics at MSU Denver. “But obviously, I think that trend has just accelerated now that we’re in the middle of a pandemic”.
Huber said requesting loans from parents is especially popular among recent college graduates struggling with crippling student loans.
According to the survey, 78% of the twenty-somethings surveyed said they’re borrowing from their parents because there are no interest fees.
“Often times children can get interest-free loans from their parents and many times without the expectation that it will be paid back. The parents may look at this as just helping their kids get back on their feet,” Dr. Huber said.
That’s also reflected in the survey, where 1 in 5 parents admit they are not confident they will be paid back.
According to the data, the categories most younger Coloradans are asking their parents to borrow money for are: rent, car payments, groceries and childcare.