Did you know that more than half of adults between the ages of and 18 and 29 live with their parents? This statistic, which comes from the Pew Research Center, reflects the highest number of young adults living with at least one parent since before the Great Depression.
Parents in this situation are in a complicated position. On the one hand, it could be a relief for financially dependent children to live with their parents. On the other hand, it can be costly for parents. If your children have returned to the nest (or if they never left), consider how you can protect your financial resources from being spent elsewhere.
Setting boundaries and expectations
Parents of adult children know that it can be challenging to determine how to treat them. Yes, they are adults, but you are still their parents.
To avoid miscommunications, conflict and instances of children taking financial advantage of their parents, parents can set boundaries and expectations.
You might have your child contribute to monthly expenses, complete house chores or perform care support services.
Additionally, look at your budget and see what your limits are in terms of providing support. Some parents can comfortably pay for a child’s car, phone, health insurance and more. Others may not have any wiggle room. Know what you have before you commit to providing financial assistance.
Consider your long-term plans
You likely will not live with your child forever. Either your child will move out, or you may need to move into a long-term care facility if you become ill or incapacitated.
Perhaps surprisingly, however, is the fact that it can be a good thing to have your children at home in terms of your financial planning, particularly if you expect to apply for Medicaid. Having a child care for you at home for two years before entering a care facility allows you to transfer your home title to that child without incurring Medicaid penalties.
In other words, if you have a child at home, you might want to formalize an arrangement where he or she serves as your care provider. Doing so can make it easier and less costly to transfer your home if you require long-term care.
You should not have to choose between helping your kids and preserving your future financial goals. With legal assistance and financial guidance, you can find ways to avoid having to make that choice.