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Generation Sponge – a new Australian phenomenon?

by on May 18, 2015

We are always on the lookout for new generational labels to add to our (growing) collection and this story from the Sydney Morning Herald doesn’t disappoint.  The label ‘Generation Sponge’ refers adult children who are financially reliant on their parents.  Interestingly unlike other generational labels this is not defined as a coherent cohort but rather appears to refer to adult children of any age and their reliance on their parents, returning the understanding of a generation to its genealogical roots.

However in a confusing twist the article (based on a website survey) also suggests how ‘Generation Sponge’ is distributed across more common categories:

  • 26 % “Generation Y, those aged 18 to 34” had parental support for a home loan
  • 12 % “Generation X, aged 35 to 54” had this support while..
  • 10% “Baby Boomers, those aged 55 to 74, still receive financial support from a parent due to saving for a home loan deposit”.

Interestingly this does suggest that parental help continues even as all parties get much older.  However the intrigue does not stop there as the survey quoted in the article also claims to reveal that:

  • 80% of parents state that they give their children financial help

vs

  • 40% of children state that their receive financial help from their parents.

This contradiction is however aside from research which claims to show that there is a shift from one-off financial support to more regular ongoing payments to children.  The article states: “Lisel O’Dwyer, a social scientist at Flinders University, said her research showed Australians handed out $22 billion to adult children each year”.  This is a very sobering thought for those of us that had assumed we might be able to cut the financial support after children complete their university education.

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