Boomerang kids: when empty nests fill up againWith a slowly growing economy and a still sluggish job market, there has been a continued increase in children moving back home after having lived independently on their own.
With a slowly growing economy and a still sluggish job market, there has been a continued increase in children moving back home after having lived independently on their own.
These so called “boomerang kids” are popping up more frequently. When this situation is managed improperly, it can cause serious family tension.
However, this boomerang opportunity can allow youth to begin saving money for the future, continue a job search or get out of debt.
Patrick Egan, chief retirement spokesperson for Thrivent Financial for Lutherans, said, “When children move back home, a closer bond can form between young adults and their parents, and this can lead to the young adults receiving financial, practical and emotional support from their parents.”
This type of increased financial co-dependence between parent and child can lead to strain when living together again after a separation. Egan said reviewing these tips can smooth the transition and help the experience remain positive and the relationship remain strong.
• Set clear expectations. Discuss how much the child should contribute to household expenses and tasks.
• Review insurance and taxes (and theirs). Save time and money by seeing if your boomerang child is covered by your health and/or car insurance. Also see if you are able to claim your child as a dependent.
• Consider having them pay rent. This gets the child into the habit of paying a monthly amount. Or have a set amount of money go into a savings account monthly that the child could use later.
• Help keep them busy. While waiting to get hired, your child could expand their résumé. Encourage them to volunteer, join a professional organization, connect with a networking group or participate in an internship.
• Focus on your own finances first. You may be tempted to use retirement dollars toward financial assistance for your child, but don’t derail your own financial plans. Keep your savings and retirement plans intact.