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There’s no shame in saving money where you can.
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Rents are high, buying a home is darn near impossible, and inflation remains a concern. It’s no wonder that so many young adults remain on their parents’ phone plans. After all, every dollar saved is a dollar that remains in the checking account and can help a young adult launch into a life of their own.
According to a survey conducted by WhistleOut, a comparison website that helps people shop for cell phone plans, 34% of adult children — and over 50% of all Generation X and millennials — share a phone plan with their parents.
However…
Sharing a phone plan doesn’t necessarily mean that an adult child needs or wants their parents to foot the bill. Some of the sharing is likely a matter of convenience, and part may be the discount associated with bundling multiple lines.
72% of those who responded to the WhistleOut survey say they pay all or part of the bill each month.
The inside scoop
Everyone’s situation is unique, but here are some of the things survey respondents shared:
74% say they know how much their current phone plan costs each month.73% consider themselves financially independent for most of their expenses.68% live with their parents.
And finally, this contradictory response:
74% say they have plans to move off their parents’ phone plan at some point. However,62% say they will stay on their parents’ plan forever.
We’re not quite sure why some people claimed that they plan to get off while also saying they plan to stay on Mom and Dad’s plan. There are clearly some mixed feelings there.
What feels right?
When it comes to the question of how long an adult should remain on their parent’s phone plan, the answers were as follows:
30% say they’ll remain on their parents’ plan as long as their parents allow them to.22% say they’ll stay on their parents’ plan as long as they live at home.21% believe adults should get their own cell plan as soon as they become adults.15% say they’ll be on their parents’ plan until they become financially independent.11% answered “none of the above.”
It’s not just cell phones
As it turns out, adult children share more than just a cell phone plan with their families. The WhistleOut survey found that they also share these tech expenses:
9% share digital news subscriptions.18% share the cable television bill.28% share the cost of internet service.11% share the cost of music or podcast streaming services.22% share the expense of TV and movie streaming services.10% share the cost of gaming subscriptions.
What about you?
The average price for a cell phone plan is $70 per month. However, for four lines, the average monthly cost is $140. Having your own plan means shelling out $70 a month, but sharing a plan with your family only costs you $35 per month. That equals a savings of $35 monthly, or $420 a year.
$35 per month may seem like nothing, but consider this. If you were to invest that $35 each month into an IRA or other investment vehicle averaging an annual return of 7%, it would be worth more than $5,800 in 10 years.
You’d have several options once the money grew. For example, you could withdraw it and add it to your emergency savings account, or you could leave it where it is, continue to add $35 per month, and allow it to grow. In 20 years, you’re looking at a value of more than $22,000 — all because you shared a phone plan.
Any way you slice it, having extra funds like this available can help cover living expenses today and allow you to plan for your future.
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