Parents Now Prioritize Down Payments Over College Funds

Parents are rewriting the playbook on helping their kids build wealth, and the change shows a growing belief in real estate over diplomas.

A new Northwestern Mutual study of 4,300 parents found that 52% are open to helping their children with home down payments, and 22% already have. Even more striking, 29% now consider homeownership support more important than college tuition, while 55% view both options as equally valuable.

The shift makes sense when you look at the numbers. Recent college graduates face 5.6% unemployment, higher than the overall workforce. Meanwhile, 42.5% work in jobs that don't actually require their degrees, raising questions about the value of a nearly $500,000 investment in a four-year education.

At the same time, homeownership is slipping further from young people's reach. The average first-time homebuyer is now 40 years old, up from their early 30s just a decade ago. The median home price has climbed past $410,000, making that first step onto the property ladder feel impossibly high.

Some parents are getting creative about building their children's wealth early. Ed Amos, a wealth management advisor at Northwestern Mutual, shared how one family helped their college student buy a duplex. The student lived in one unit while renting out the other, building equity before even graduating.

The Ripple Effect

This generational wealth transfer could reshape how young people achieve financial stability. Boomers hold over $86 trillion in assets, and Gen X controls another $44 trillion. Together, that's more than three-quarters of all U.S. wealth, leaving Gen Z scrambling for alternatives.

Without family support, many young people turn to riskier paths. Nearly one-third of Gen Z has invested in cryptocurrency, another third has tried sports betting, and 14% have gambled on meme stocks like GameStop. These high-stakes bets reflect a generation searching desperately for entry points into wealth building.

Amos believes the most sustainable solution involves transferring wealth through traditional assets like real estate rather than waiting for inheritance. By helping children buy homes now instead of later, families can share the American dream across generations while it still feels achievable.

The message is clear: when the traditional path forward gets blocked, families find new routes together.