The most incisive guide to issues facing the American family today . . . An invaluable resource for anyone wishing to stay on the cutting edge of research on family trends.

-W. Bradford Wilcox
Associate Professor of Sociology, University of Virginia 

Thursday, December 10, 2015 (Volume 4: Issue: 30)

The Topic: All in the Family

The News Story: Millennial Start-Ups Getting More Family Loans

The New Research: Stiffing the Stepchild

The News Story: Millennial Start-Ups Getting More Family Loans

With student debt soaring, more and more millennials are turning to mom and dad for personal loans to start their own businesses.

Reports CNBC, “About 22 percent of self-employed millennials used a financial gift or loan from their family to fund their start-up, according to a TD Ameritrade report. . . . Plus, more than 1 in 10 millennials say they're using a financial gift or loan from their family to run their business after the launch phase.” This number is in striking contrast to previous generations: Only about four percent of the Baby Boomer generation and six percent of Gen X-ers turned to family for start-up money.

What the story doesn’t report on is which parents are willing to help their children foot the initial bills for their entrepreneurial ventures. Research indicates that once again, family form makes a difference.

(Source: Kate Rogers, “Millennial Start-Ups Getting More Family Loans,” CNBC, December 9, 2015.)


The New Research: Stiffing the Stepchild

Four decades after progressive activists pushed through permissive divorce laws, millions of Americans find themselves dealing with the sorry consequences of revolving-door marriages. Those consequences have been particularly malign for many of the stepchildren born into post-divorce melded families. Shedding new light on the challenges stepchildren face is a new study of the financial assistance parents give children—and stepchildren. It will probably surprise few stepchildren that this new study—completed by researchers at the Universities of Pennsylvania and Florida—concludes that parents open their wallets much more freely for children than for stepchildren.

To establish patterns of parental financial support for their children and stepchildren, the authors of the new study pore over data collected between 1996 and 2004 for individuals born between 1931 and 1941, “the first [generation] affected by changing marital patterns that have produced an increased number of blended families.” Overall, the data account for 14,544 resident and non-resident children age 18 or over associated with 3,812 familial households.

Analysis of these data reveals that parents in melded families vary considerably in their willingness to give financial assistance to children or stepchildren. Quite simply, the researchers conclude that “some parents give and others do not.” However, the data also indicate that when parents do give financial assistance, “stepchildren are disadvantaged within families, particularly stepchildren of the wife.” 

This generalization comes into sharper focus in a statistical model for a representative melded family with four children. The researchers calculate a 33% probability that parents in such a household will financially support a shared biological daughter. In contrasting parallel calculations, the researchers find much lower probabilities of such parental money transfers for stepchildren who are the biological offspring of the mother in the home but not of the stepfather who is her husband. These markedly lower probabilities range from 17.3% to 24.6%, depending on the age of the stepchildren when their parents remarried. Even more striking, however, are the even lower probabilities of parent-to-child financial transfers benefiting stepchildren who are the biological offspring of the father in the home but not of his wife, their stepmother. For such stepchildren, the researchers calculate “probabilities of transfer receipt that are less than half of those of the [husband’s] stepchildren.”

In attempting to explain why children reared with a stepmother are even more disadvantaged than children reared with a stepfather, the researchers draw on sociobiological reasoning, invoking “the genetic argument that women are more concerned for their biological children—that is, they are more altruistic toward them—than are men.”

Progressives never tire of reminding the nation of their laudable fight against any policy or practice relegating minorities to second-class citizenship. These progressives conveniently forget to mention how their crusade for permissive divorce laws has consigned millions of stepchildren to second-class status within their own families.

(Source: Bryce J. Christensen and Robert W. Patterson, “New Research,” The Family in America, Summer 2015, Vol. 29 Number 3. Study: John C. Henretta, Matthew F. Van Voorhis, and Beth J. Soldo, “Parental Money Help to Children and Stepchildren,” Journal of Family Issues 35.9 [2014]: 1131-51.)