Intra-Family Cash Transfers in Older American Households

June 2015
EBRI Issue Brief #415
Paperback, 32 pp.
PDF, 1,897 kb
Employee Benefit Research Institute, 2015

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Executive Summary

  • This study reports the frequency and extent of intra-family cash transfers: both transfers from older households to their children and grandchildren, and vice versa. It also shows how these transfers are correlated with income levels and compares the asset and income levels of households that make such transfers and those that don’t.
  •  The results show that a very small portion of older households receive transfers from their younger generations, while a much larger section of older households transfer money to their younger generations. The amounts transferred by older households are much higher than what they receive. These transfers are highly correlated with income. The average annual transfer amounts are large enough to be considered as a major spending item in a household budget.
  • From 1998 through 2010, there has been an increasing trend of transfers going from older households (those where at least one member of the household is ages 50 and above) to their family members.
  • Very few older households (4 percent to 5 percent) receive cash transfers from their families, compared with those who transfer money (38 percent to 45 percent) to their younger family members.
  • Among those ages 50 and above, relatively younger households are more likely to transfer money to their families and relatively older households are more likely to receive such transfers.
  • The amount transferred from older Americans to their children and grandchildren generally goes down with age. During a two-year period between 2008 and 2010, the average amounts transferred by households who had at least one member between ages 50?64 and ages 85 or above were $8,350 and $4,787 respectively.
  • The average transfer amounts from younger family members to older households are much smaller. During the same two-year period, households who had at least one member ages 85 or above received the highest average transfers among all age groups and the average amount was $359.
  • Higher-income households are more likely to transfer money to their family members.
  • Households in the top income quartile transfer much larger amounts to their family members than those in the lower quartiles.
  • Older households that transfer money to their families have much higher income and assets compared with those that do not make such transfers.