America’s economy depends on millions of workers whose labor rarely appears on a payroll, tax return, or corporate balance sheet. They drive children to school, watch them while their parents work, buy groceries, cover medical bills, help with tuition, and step in whenever a family emergency threatens to become a crisis.

They are America’s grandparents.

According to a new AARP study on the essential role of grandparents, grandparents provide approximately $903 billion in unpaid care and direct financial assistance to their grandchildren every year. That figure includes an estimated $731 billion worth of caregiving and another $172 billion in financial support.

The numbers reveal something many families already understand: Grandparents have become one of the country’s most important—and least recognized—sources of economic stability.

More Than Occasional Babysitting

The stereotypical grandparent may visit on holidays, attend school plays, and occasionally watch the children for an evening. For millions of families, however, the relationship involves far more responsibility.

AARP reports that 69 percent of grandparents provide some form of care for their grandchildren. Those who provide care average nearly 511 hours a year, or roughly 10 hours a week. That is the equivalent of more than 12 weeks of full-time work every year.

Fifteen percent of grandparents care for grandchildren daily or almost daily. Their responsibilities may include preparing meals, handling school transportation, supervising homework, attending medical appointments, and providing childcare while parents work.

This unpaid labor can determine whether a parent is able to remain employed, accept additional hours, return to work after having a baby, or avoid spending thousands of dollars on formal childcare.

Grandparents often describe love and a desire to spend time with their grandchildren as major reasons for helping. But the leading practical reason is frequently the work schedules and other obligations of the children’s parents.

Grandparents are not merely visiting the family. In many households, they are helping keep the entire operation running.

The Money Grandparents Quietly Provide

The support extends well beyond caregiving.

Nine out of 10 grandparents reported spending money on their grandchildren during the previous year. The average contribution was $2,654 across all grandchildren, an amount greater than the average monthly Social Security retirement benefit.

Some of that money goes toward birthday presents, Christmas gifts, vacations, and other enjoyable experiences. Much of it, however, pays for necessities.

AARP found that 41 percent of grandparents provide financial help for basic expenses such as clothing, food, childcare, and school supplies. Others help pay for camps, extracurricular activities, family travel, college expenses, and medical or dental care.

A small grocery purchase, a new pair of shoes, or a paid utility bill may not look significant in isolation. Added together across approximately 65 million American grandparents, those individual acts of generosity become an enormous economic force.

Grandparents provide an estimated $172 billion in direct financial assistance each year. Combined with unpaid caregiving, the total value of the “grandparent economy” reaches approximately $903 billion annually.

A Safety Net Built Around Relationships

Government programs are generally organized around eligibility requirements, applications, income thresholds, and administrative procedures. Family support often works differently.

A parent whose car breaks down may call a grandparent for help getting the children to school. A grandchild who needs braces may receive assistance from Grandma and Grandpa. When daycare closes unexpectedly, a grandparent may reorganize an entire week to cover the gap.

This informal safety net is flexible because it is built around personal relationships rather than regulations.

It is also difficult to replace. A professional childcare provider may supervise a child, but a grandparent brings family history, emotional security, trust, and a long-term commitment that cannot easily be assigned a dollar value.

Grandparents frequently transmit religious beliefs, family traditions, practical skills, stories, and expectations about character. Their influence can provide children with a sense of continuity at a time when families are often separated by work demands, divorce, relocation, and financial pressure.

Families Are Rearranging Their Lives

Geography plays a major role in how much support grandparents can provide. Nearly half of grandparents have at least one grandchild living nearby, according to the AARP research.

More than one-quarter have made a major change to live closer to their grandchildren or help their family move closer to them. Some relocate to the same community. Others move into an adult child’s home or welcome children and grandchildren into their own residence.

Approximately 28 percent of grandparents reported living with a grandchild at some point during the previous year, while about 11 percent were currently sharing a home with one.

This is part of a broader return to multigenerational family life. A Pew Research Center analysis found that the percentage of Americans living in multigenerational households more than doubled between 1971 and 2021, rising from 7 percent to 18 percent.

The total number of people living in these arrangements quadrupled during that period, reaching nearly 60 million Americans in 2021.

The U.S. Census Bureau separately reported that approximately 6.7 million adults age 30 or older lived with grandchildren in 2021. Nearly one-third of those grandparents were responsible for their grandchildren’s care.

The Personal Cost of Helping

Most grandparents view their role positively. AARP found that 83 percent associate grandparenting with joy, while 80 percent describe the experience as fulfilling.

That does not mean the work is always easy.

Some grandparents are caring for young children while managing arthritis, limited mobility, chronic health conditions, or their own medical appointments. Others are still working full time. Some are simultaneously helping grandchildren and caring for an aging spouse or parent.

AARP found that 13 percent of caregiving grandparents feel physically taxed by the responsibility, while another 26 percent say caring for grandchildren is both energizing and physically demanding.

Financial assistance can create another form of pressure. Grandparents naturally want their children and grandchildren to be secure. But regularly paying household expenses, tuition, rent, or childcare can slowly weaken a retirement plan that took decades to build.

Unlike younger adults, retirees may have limited opportunities to replace depleted savings. A grandparent who withdraws too much from retirement accounts or assumes debt to help the family could eventually become financially dependent on the same children he or she intended to support.

Generosity is admirable, but assistance that endangers a grandparent’s housing, healthcare, or long-term security may create a larger family problem later.

Helping Without Losing Financial Security

Grandparents who provide regular support should consider treating the arrangement as a family responsibility rather than a series of unplanned emergencies.

That begins with an honest conversation. Parents and grandparents should discuss how often childcare is expected, which expenses will be covered, how transportation will work, and what happens when the grandparent is unavailable.

Financial boundaries are equally important. A grandparent might establish a fixed monthly amount for family assistance rather than responding to every request individually. Larger gifts should be considered alongside retirement income, emergency savings, insurance needs, and possible long-term care expenses.

When grandparents provide significant childcare, families can also look for ways to reduce the burden. Parents may supply meals, cover transportation costs, keep necessary equipment at the grandparents’ home, or arrange backup care so one person is not always on call.

Clear expectations do not weaken family bonds. They help prevent exhaustion, resentment, and misunderstandings that can damage those bonds.

The Concern Behind the Generosity

The money and time grandparents provide are often motivated by concern about the future younger generations face.

In the AARP survey, 45 percent of grandparents identified the future cost of living and affordability as a serious concern. Educational quality and access, economic instability, mental well-being, and financial security were also common worries.

Those concerns are understandable. Younger families face major expenses involving housing, healthcare, childcare, transportation, and education. Many young adults are also reaching traditional milestones later than previous generations.

A Pew Research Center study of parents and young adults found that only 45 percent of adults ages 18 to 34 considered themselves completely financially independent from their parents.

Among young adults living in a parent’s home, 64 percent said the arrangement had improved their personal financial situation.

Grandparents often see these pressures firsthand. Their assistance is not simply indulgence. In many cases, it is a practical response to a family economy that no longer works as comfortably as it once did.

Wealth That Cannot Be Measured

The $903 billion estimate is remarkable, but even that enormous number does not capture everything grandparents contribute.

It cannot measure the reassurance a child feels when a trusted grandparent is waiting after school. It cannot calculate the value of a family recipe being taught, a Bible story being shared, or a lesson from decades of experience being passed to the next generation.

It cannot measure the stability provided when a household knows there is someone dependable to call.

Grandparents are providing childcare, transportation, food, housing, education, and financial assistance. They are also providing memory, identity, patience, and continuity.

America’s grandparents may not appear in official employment statistics for this work, but the country’s families—and much of its economy—would struggle to function without them.

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