The Grandparent Check
Here’s how much it costs to be a grandparent today
by Shelley Emling
Grandkids are the best, but they do cost you a pretty penny.
En español | To be sure, there are plenty of grandparents who love nothing more than doting on their grandchildren. But grandparent love does come with a price tag. A new survey from TD Ameritrade found that grandparents spend an average of $2,383 each year to benefit their grandkids.
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Specifically, the survey of 1,004 millennial parents and 1,014 grandparents with millennial children found that grandparents’ generosity extends to everything from toys to meals to college.
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Here’s how the numbers break down:
- 19 percent contribute to college savings
- 55 percent contribute to clothing
- 58 percent contribute to toys
- 39 percent contribute to non-cash gifts
- 42 percent contribute to cash gifts
- 27 percent contribute to school expenses
- 16 percent contribute to vacations
- 38 percent contribute to meals out/entertainment
- 14 percent contribute to extracurricular activities
- 10 percent contribute to allowance/payment for chores
But money isn’t all grandparents are good for. More than 50 percent of millennial parents say they rely on their own parents for a minimum of an hour of babysitting help each week. Parents estimate that their own parents’ hours of support save them an average of $300 a week. And it seems grandparents are only too happy to pitch in, with 40 percent reporting that they offered without being asked.
That’s not to say there aren’t trade-offs. The TD Ameritrade survey found that nearly half of grandparents report having made at least one compromise in order to give time or financial support to their grandkids. More than 25 percent say they have tapped into their savings, and 8 percent have put off retirement.
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Higher education, of course, is often the biggest financial concern. With the total cost of college expected to climb to as high as $334,000 in just two years, knowing how to help without jeopardizing your grandchild’s ability to obtain need-based aid is key. One way to do so is by giving the money directly to the parents, rather than to the student, and then letting the parents cover the bills.
For grandparents on a budget, there are ways to avoid sticker shock. Fancy taking your grandkids to Disney World? Don’t go during the peak summer months, when prices are highest. Instead, travel in late January, early in February or in September when you’ll save approximately $17 per ticket.
And for those walking a financial tightrope, there are ways to lend a hand without forking over a dime. For example, a little mentoring of grandkids by helping them launch a small business — even if it’s just a family yard sale — goes a long way.
In the end, whether rich or poor, almost every grandparent has one thing in common: They just want to hold a special place in their grandchild’s heart. With that in mind, here are nine signs that you are one awesome grandpa or grandma.