September 1, 2011

Junior is Back Home...Now What?

They have been called bommerang children who end up moving back in with mom and dad. Sometimes the return is brief, for others it becomes an extended stay. I was surprised by the statistics: 13% of parents with grown children say one of their adult sons or daughters has moved back home in the past year. During a bad economic period, up to 40% of college grads are back with their folks a full year after graduation. (2009 study)

Obviously, having an adult child move back home presents both challenges and opportunities to your satisfying retirement lifestyle.  Beyond the basic change an extra person makes to your day-to-day routines, space use, and costs, there are other important issues that need to be addressed.  Consider the following if you have an adult child ready to move "home:"

Protect your retirement assets. The worst thing you could do it tap deeply into what you will need to help your child out. If you are retired, or soon to be, you do not have the time to build those funds back up to the level you have determined you will need. While you may feel pressured to bail your son or daughter out with the money you have in your 401 (k)) or IRA, don't do it. That advice comes from every financial source I could find on the Internet and makes complete sense to me.

If you do provide some money, make it a loan, not a gift. If you are able to help your child out while he or she attempts to get back on their feet without tapping your retirement money, then by all means do so. But, the suggestion is to loan the money rather than making it an outright gift. You will feel more like a partner in helping your child. And he will feel more like an adult than a child, still getting gifts from mommy and daddy. Establish a regular repayment schedule and charge at least some interest.

Charge room and board. Yes, I know she is your own family member. But, for the same reason you should loan money instead of giving it to her, the fact is she will increase your living costs. Charge a monthly rent that is well below normal market rates. But, the extra money will help you with the increased food and electric bills. Paying something toward those costs will help the child's self-respect, too.

Agree on basic ground rules. The new "tenant" should help with some household chores, handle his own laundry, offer to go food shopping on occasion, and help with the cooking or cleanup. If you prefer a neat home, insist that his living space (and yours) remains that way. What about bringing over dates or friends? What about "sleepovers" with members of the opposite sex? Decide well ahead of time the answers to these questions.

Insist that he or she actively look for a job or whatever it takes to become independent again. Lying on the coach while watching 6 hours of TV a day,  playing video games, or sleeping until noon is going to cause problems....quickly. Agree before the child moves in what is a reasonable plan for moving back out again.

Set a timetable. There should be some sort of "finish line" to this arrangement. Set a time-based limit, or when a certain income level has been met. Of course, you may need to be a bit flexible with this requirement. But, a timetable does help motivate the returning child to become creative in solving his problems. That may mean 2 or 3 part time jobs and living with a roommate. It may mean sharing a car or relying on public transportation. If there is a projected end to the bommerang phase, both parents and child have a goal to aim for.

Treat your "child" like you would an adult renter, not as his parent. It is quite likely he or she already feels bad about having to move back with mom and dad. Don't compound that by reminding him whenever possible of that fact. Respect his privacy, opinions, and needs. Realize that while he still wants your respect, he doesn't really need your permission. If he is following the ground rules you have both agreed upon, then take off your parent hat.

On the positive side, if your relationship with the returning child is good, this may be a tremendous time period together. Your "child" is an adult in opinions and actions. You can enjoy him or her for who they have become. The need to "parent" has diminished. The time is there to enjoy his or her uniqueness. It also feels good as a parent to help a child in time of need.

Having an adult child move home when he or she has lost a job, suffered the end of a bad marriage, or is recuperating from a serious illness will change you life, and theirs. By establishing fair and clearly defined rules and obligations it can be a time of discovery and a time of deepening relationships. It could be a tremendous plus for your retirement lifestyle.

Have you experienced the "boomerang" effect? Do you have any ideas or suggestions we can benefit from? Even if an adult child of yours has never returned home, I'll bet you have some opinions about the subject. Here's the place to let it fly!

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Alert: Money Magazine will have a feature story in the October issue about how Betty & I have built a satisfying retirement. Look for it in your mailbox, on the newsstands, or right here in a few weeks. 


  1. If you loan your child money, have them sign a promissory note, with interest and how and when the loan will be paid back.

    Trust me. It'll come in very handy later on. Like, ah, when they deny you ever loaned them money in the first place.

  2. Morrison,

    Probably a smart move on a variety of levels. The IRS is happier, too.

  3. Up until now- any money coming from us has been a gift. If you should ever gift more than $13,000 - the child has to pay income tax on the gift! Our daughter has moved home three times since getting married. She has normally stayed six weeks between her husband's assignments. We have a large house and she takes over the bottom floor. So far it has worked for all of us.
    My brother lives at my sister's second home rent free. This is slowly becoming a problem now that he is making an income....
    It is an interesting time in our country now that so many are losing their homes....

  4. JBO,

    With your daughter back home several times you have an excellent perspective on this topic. The rent-free situation sounds like a problem waiting to happen. Good luck with that.

    This is a tough time for a lot of people. Luckily family is often there to help hold everything together until things improve, which could take a lot longer that we expect.

    I just read the govt is planning on suing 10 major banks for billions of dollars over the mortgage mess. Will that make it even harder to get a loan? I guess we'll see.

  5. Neither child has needed to move back home yet, but both have needed some financial help in the recession. Our son was three years into his first job when the company closed its doors.

    He believed he could pick up the former clients and serve them better and less expensively by starting his own business. He was prepared to be available 24 hrs. a day, all week, to his clients. By careful agreement, we paid his bills for nine months to give him a shot at it. We knew his work ethic and knew there was a steady market for his services in his area.

    It worked; his business has been thriving since '09. We may see that money back and we may not, but any time we help our kids, we know in our hearts that it's a gift. If we determine to give it, we have to be willing to let it go.

    I think your advice is good in general. In this case, we haven't regretted doing it differently.

  6. Re JBO:just wanted to add that each of them can give individually up to $13,000 a year-so they could give up to $26,000 before the gift tax applies. Also,generally donor pays gift tax per IRS.GOV but donee may agree to pay it.
    Sorry if this is a duplicate-tried to previously send this.

  7. Donna,

    You are correct. The $13,000 amount is per gifter. Just be sure to write 2 separate checks to avoid problems

  8. My adult son moved back in with us for a year after he was unable to find work. Although we were happy to be able to help we made a few mistakes that I'll share here. 1.) didn't charge R&B ( in my culture this is not generally done) but in hindsight it was a misrake. In retrospect we should have, in large part because he ended up being very expensive our utility bills went up x3. 2.) expect him to participate/cooperate (for us, we assumed he would, but years of dorm and roomate living made our son assume we were roomies NOT! He didn't consistently pick up after himself, his room was a disaster with food dishes and clutter, he would use our food to make himself a terrific meal which he didn't offer to share with us after we came home from work 3.) outline clear expectations and consider putting them in writing and have him sign it much like a tenant agreement. We didn't do this, but would now, as we were surprised by all of the above. Could be partly a young adult thing but he actually argued with us about the AC ( which we pay for), we'd come home and find it set to 70 !!!! He took a minimum of 3 looooooonnng showers a day, again using up quite a bit of water. Anyways that's my two cents. I can think of more but then it would turn into a rant rather than a comment. Thankfully, he's been out and on his own for a year and a half!

  9. Terry,

    Your situation makes a strong case for several of the suggestions in this post. Expectations that aren't clearly spelled out can create problems for everyone.

    Thanks very much for sharing your less than pleasant experiences. We all can learn from each other in cases like this.

  10. You are the Solomon of boomerang kids. When my daughter moved back in after only a few months on her own and pregnant(!), we set out the rules. She resumed her share of chores (my kids have always done all the housework), of course. I told her I would provide housing and food while she finished her school program. And I will provide limited childcare once the baby is here while she is at work or school. (The dad and his family will be helping, too.) I will not pay for anything else. She has continued to work and go to school full time during her pregnancy. She is taking fall quarter off (baby is due in 3 weeks), and then she will go back to work and school full time. I told her she has one year after the baby is born to finish school and move out.

    You are also right about the unexpected benefits. She and I have grown even closer during this time. I am proud of how she has grown up quickly into a responsible young woman ready to be a good mother. And I'm excited about my first grandchild.

    But I would not be going forward with a positive attitude if we had not set out clear boundaries and rules. Your advice is right on target.

  11. Hi Galen,

    The Solomon of Bommerang kids. Wow! Thanks for the compliment, unless you are implying I am very, very old.

    I like your comment. It summaries the way you and your daughter handled what could have been a tough situation in a loving and helpful manner. As a bonus you are about to receive one of the great joys in life: a grandchild. Best of luck to your daughter and her child. It is rather obvious they are surrounded with love.

  12. Nance...a few comments back,

    Have you been home since Irene? Are things OK?

    General guidelines are just that...meant for the average situation. Every family knows what will work best for everyone. You obviously chose well in your son's case. That fact that he is succeeding now is great news.

  13. To me it seems the parents' basic paradigm is the same whether your child is 5 years old or 25 years old, starting with how can I best love my child and assist them in their long term development. That, of course, doesn't rule out boundaries or ignoring the parents' legitimate needs from the equation.

    Often the dialogue on this subject from parents seems to self center on the hardship for the parents without regard to the ongoing opportunities for age appropriate "parenting." Well, parenting, like many great vocations, can be challenging at times. But, it is certainly life giving and rewarding too!

    Btw, Bob, I read your post (like always) to be well balanced and mindful of all these dynamics.

  14. Good Morning Rick,

    Thanks for the compliment on balance. I am quite aware of the need to present information that might help someone resolve a problem, not just get something off my chest. There are enough blogs like that!

    Being a parent is a job that never ends. Your "child" can be 50 and still you worry. It is the most rewarding role I have ever played. I wouldn't replace a single moment of it.

    I was just wondering if someone who feels his or her job is done at a certain age is really more of a father or mother, than a parent. The former is a simple biological fact while the latter is a lifetime commitment that goes well beyond being simply half of the team that created that person.

  15. Some years ago, I had a neighbor whose 29 year old son just wouldn't move out of the house. So the couple sold their home and moved into a small condominium. Their doing so wasn't entirely based on getting the kid out of the house, but the kid's comfort level was a large contributing factor. Bill

  16. Bill,

    Sounds like the parents were enablers. Moving to a small place to get a child to move on seems a bit extreme. I gather the communication between parents and son were not the best.

    I've never heard of that "solution" to the problem before. Interesting addition to the discussion. Thanks, Bill.