Posted 10/21/2017

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Your adult children are moving home: Don’t freak out

Millennials Moving Back In With Parents

Joe Jessie

The Mortgage Reports Contributor

If you haven't noticed, more adult children are moving back home with their parents. 25 million adults to be exact, but who's counting? This may cause a bit of panic for both parties but if you want to make this work, you need to set some ground rules.

Understanding adult children

I myself am one of those 25 million adults who have swallowed their pride (and usually their savings) and moved back with my parents. As most Millennial adults would attest, the choice wasn't easy but the right one. I was living in Los Angeles for 3 years, sharing a two bedroom apartment with my girlfriend and her brother. All of a sudden, we're pregnant. Juggling the high cost of living and raising a child got hard. By the time we reached the end of our lease we had a decision to make, stay and keep trying or go back home and regroup?

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Pros and cons

The obvious benefit is in the cost. Essentially free rent. If you can manage to get a job quickly you can start saving more and paying down debt faster. You also have a chance to reconnect with your parents as an adult. Moving home is like getting the best landlord ever. But you still have a landlord. As the one moving back, understand you are moving into a house of their rules. Those days of you walking around in your underwear at your place are done back home with mom and dad. Remind yourself it's temporary, and a part of the bigger plan.

Others may consider moving home some sort of failure. It's really in how you look at it. Sure, on a social level you may think you've taken a step back, but if done correctly this decision can help catapult you forward. Not to mention I'm sure your parents enjoy hearing about your work day.

That's another important part in all of this: Goals. It may be an uncomfortable conversation, but it's a necessary one. Questions like: "Do you have a plan in place on moving out, and how can I help you with that?" "Your first three months are free, but after that what can you commit to financially" For the most part your parents are always going to welcome you back home. Making sure everyone knows this is temporary is going to make this transition smoother for both sides.

A look at the numbers

Adult children student loan debt

It’s likely that more parents will face the return of adult children, not just because of housing costs but also the burden of student debt and shifting social patterns, which includes young adults delaying marriage and the starting of families.

About 25 million adults live with their parents, and the numbers continue to rise, according to Pew Research Center analysis of census data. As of 2016, 15 percent of 25- to 35-year-old Americans were living in their parents’ home, the highest share since 1940. Today’s young adults also are more likely to be at home for an extended stay of a year or longer, compared with previous generations.

According to Pew Research Center, it's likely more parents are going to face the return of their children. The rising housing cost, student loan debt and delays in marriage and having a child affect the 25 million adults living with their parents. In 2016, 15% of Americans ages 25-35 years old were living in their parents' home. This is the highest its been since the 1940's, with most young adults likely to be home for a year or longer.

Best plan of action

Author Christina Newberry of "The Hands-on Guide to Surviving Adult Children" says the success lies on managing expectations. Having a clear understanding of financial issues is important not only for the adult child, but the parent too if they want to lead them back to independence. The word "free" means different things to different people, so making a plan that both parties are comfortable with can streamline the process.

One family came up with a specific plan for their 23-year-old son who moved back home to start a new job at Microsoft. At first, they didn't charge rent, because for the first six months their son would use that money to repay back those student loans (mainly the ones they co-signed). Once those were paid off, he would contribute $500 a month in rent while paying back the other loans.

Not every family is like this, and each situation is of course different. But they felt but giving their son a chance to knock down some of that debt would better prepare him to go back out into the world.

Joe Jessie

The Mortgage Reports Contributor

Joe Jessie is the Social Marketing Director for The Mortgage Reports. He has helped companies such as luxury real estate firm Sotheby's International reach a wider audience. Connect with Joe on Twitter, Facebook, and Instagram.

The information contained on The Mortgage Reports website is for informational purposes only and is not an advertisement for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent, or affiliates.

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