Family Support Across Generations

How money, time and care flow between parents, adult children and grandparents, and how this differs around the world.

Families support each other across generations in many ways. Parents pay for children’s education and help young adults with housing. Grandparents care for grandchildren. Adult children care for ageing parents. Economists call these flows intergenerational transfers.

Different systems around the world

In many countries, especially in South Asia, East Asia and Africa, the extended family has long been the main social safety net. In the traditional joint family common in India, several generations live together, share income and property, and care for elders at home. In such systems, children are an important form of old-age security.

In many rich countries, governments took over part of this role during the twentieth century through pensions, public healthcare and care homes. Money and care still flow within families, but older people depend less on their children for basic income.

Money flowing down

In rich countries, money often flows down the generations. Parents help adult children pay for university, rent or a first home deposit. Research on the United Kingdom and the United States suggests that help from parents has become an increasingly important factor in whether young adults can buy homes, which can widen inequality between those whose families can help and those whose cannot.

Care flowing up

As populations age, more adults find themselves caring for elderly parents. Those who are also raising their own children are sometimes called the sandwich generation. Unpaid elder care is very valuable but has costs: carers, most often women, may cut their working hours or leave jobs, losing income and pension savings.

Grandparents as childcare

In many countries, grandparents provide a large share of childcare, letting parents work. If a grandmother looks after two grandchildren three days a week, she may be saving the family hundreds of dollars a week in childcare fees. This value does not show up in any statistics, but it can decide whether both parents can work.

Thinking family support is disappearing

Some worry that modern life has ended family support across generations. In fact, large flows of money, housing help and care still move between generations in every country. What has changed is their form, and the balance between family support and government programmes.

Key takeaways

Intergenerational transfers include money, housing help, childcare and elder care.
In many countries the extended family is the main safety net; in others, pensions play a larger role.
Help from parents increasingly shapes young adults' ability to buy homes in rich countries.
Unpaid elder care is valuable but can cost carers income and pension savings.