Tips and tricks to help them while preserving your budget
Having adult children move back in with you is an increasingly common phenomenon; a 2014 survey by Pew Research Center found that 32% of 18- to 34-year-olds in America live with their parents, making it the most common living arrangement in that age group. Just because it’s common, though, does not mean it is something you should allow without thought of how it might impact your life—and to be more specific, your retirement budget. Here are four things you can do to try to cushion yourself from any financial harm while still doing your best to help your children out.
Charge Rent
Adult children frequently move back in for economic reasons (be it due to hardship or simply to save up a little cash), but that doesn’t necessarily mean you should let them live with you for free. It may not be feasible to charge the market rate for the room your child is occupying, but charging some amount of rent, even a nominal sum, is a good idea. Not only will this help to offset the costs of having them in the house, but it will establish the expectation that they are essentially tenants and must contribute to the household in some form. This can be an especially beneficial arrangement if your child secures well-paying employment while living with you and can pay a greater amount—they will likely be able to cover all their own utility costs and maybe even provide you with a little profit to supplement your retirement budget. All while continuing to pay less than they would elsewhere. It’s a win-win situation.
Don’t Fall Back Into Old Habits
Having your child living at home again is bound to stir up memories of your old relationship dynamics, and this can cause some confusion regarding roles and obligations in the household. It might seem second-nature to hand over the occasional $20 for a movie just like you used to do, but that doesn’t mean it’s a good idea. Remember, your child is no longer a minor, and your responsibility to them extends only so far. It might make sense to provide food for them by simply making a little extra at mealtimes, but if they want luxuries, they must choose between providing them on their own or doing without them. Any extra generosity on your part must be done very occasionally and with an understanding that it is a one-time occurrence that cannot be counted on in the future.
Discuss Their Plans With Them
As soon as your child brings up the idea of moving in, there are some questions you should ask them. What is the goal driving their choice to move in with you, and what steps are they taking to reach this goal in a reasonable amount of time? Laying out these benchmarks in explicit terms (instead of just 'going with the flow') can help you gauge the expected duration of the stay, and budget accordingly. It will also ensure that the move back is a purposeful choice and not just an attempt to give up on life. These statements are only projections and are liable to change as time goes on, but they give you somewhere to start.
Put Yourself First
This last tip might sound somewhat draconian, but it is the most important consideration of all: ensure that the future of your existing household is financially secure before you agree to take your adult child in. If money is already tight and you simply cannot afford to do this without severely compromising your retirement budget, the only sensible thing to do is say no. It may be extremely painful to have to turn your child away, but it may be necessary to avoid losing your self-sufficiency in the future. You won’t help anyone by becoming dependent on your children later in life because you’ve neglected to save adequately for retirement. Find other ways to help your children if you can (perhaps another family member might be in a better position to take them in?), but do not feel obligated to bankrupt yourself for them. At your age, your primary duty is to yourself, and that’s nothing to be ashamed of.
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