Are your adult children “yuckies”?
Another new acronym has been coined to describe adult children living at home: yuckies. It stands for Young Unwitting Costly Kid.
The interesting thing is that so many of the adult children who still rely on their parents for financial support really are unwitting about the amount of financial pressure it can put on parents to support their children well beyond childhood. If your adult children are thinking about moving home — or are already there — make sure you talk to them honestly about any concerns you have about your own financial well-being, whether it’s major, like concerns about being able to pay the larger grocery or heating bills, or whether it’s a simple thing — like you’d been planning a vacation that you can no longer afford to take. A family budget can be a good way to get a clear picture of your boomerang kid’s impact on your household finances.
Video Tip: How much rent to charge adult children living at home
Are your adult child’s finances your business?
One of the biggest sources of conflict between parents and adult children living at home — in fact, between just about any adults who share a household — is money. In a recent column for the Washington Post, Michelle Singletary explained when — and why — and adult child’s finances are, in fact, their parents’ business. The column was written in response to a letter from an adult child living at home that began like this:
“My parents and I are at an impasse,” she said. “After graduating college, I had minor credit card debt. I asked to move into my parents’ home after living on my own for a while to get rid of the debt, and to get other finances in order. I wanted to do a reset and start off right before it got out of hand.”
To see what Singletary had to say about this hot topic, you can read her column online here.
More on how to talk to your adult kids about money
A few days ago I posted a link to a Washington Post column by Michelle Singletary, inc which she talked about when adult children’s finances may be their parents’ business. Today, I’ve got a link to the transcript of a live online chat Singletary hosted, where she answered questions about various topics. With her column fresh on their minds, many people asked for more information about dealing with adult children’s finances. It makes for an interesting read, and you can find it here.
20% of fathers willing to help adult kids with $20,000 or more
A new survey from CreditCards.com shows that 20% of fathers would help their children to pay off $20,000 or more in debt, even without expecting to be repaid. Just 12% of mothers said they would make the same decision.
In both cases, parents were willing to help pay off credit cards, a mortgage, or student loans, and were much less likely to help pay off gambling debts.
You can read an article about the survey here.
Teaching your adult children about investing
If you’re planning on helping your adult children out with a financial gift, it can be a great opportunity to teach them about investing. After all, the goal is for your adult children to someday become financially independent, so any tips you can give them now to help them toward that path will benefit everyone later.
This article from Carrie Schwab-Pomerantz of Charles Schwab & Co., Inc. offers some great tips for how to turn a financial gift into a life lesson in financial management.
Giving financial assistance to adult children
Whether or not your adult children live with you, it’s likely you’re providing them with some financial assistance. Make sure you do so in a way that helps your adult children work towards the ultimate goal of independence, and doesn’t interfere with your own financial well-being or retirement plans.
This article from SeaCostOnline.com offers some good tips, and some reminders about what to consider when setting up a repayment plan for a loan to your adult kids.
Talking to your Adult Children About Money
Here’s a link to a video with some great advice for talking to your adult children about money — whether they live with you or not.
Advice To Give Adult Children About Money
Parents’ Health Insurance for Adult Children Living at Home
We’ve talked before about legislation in various states that allows parents to keep their dependent adult children on their health insurance.
Here’s an article from the Wall Street Journal that summarizes the various states’ coverage all in one place. If you need to know whether your health insurance could cover your adult child, you should definitely take a look!
http://online.wsj.com/article/SB125098113262151655.html?mod=rss_Health
Dreading the empty nest?
For some parents with adult children living at home, “empty-nest syndrome” is a delayed phenomenon, happening when children are in their late 20s or even 30s rather than when they are heading off to college as very young adults. Recent research has shown that empty nest syndrome may be a myth — that parents whose adult children live at home are actually more depresses that those whose kids live away — but for the writer of this article from the Telegraph, looming empty nest syndrome is a reality.
Two things about this article — the writer is doing a couple of things that conflict with the advice we offer, so we want to make sure you spot them. She’s not charging her adult daughter rent, hoping that the adult daughter is saving for a down payment on her own home. We suggest that parents always charge at least some form of rent (even if it’s paid in labor by doing chores around the house) to get the adult kids in the mentality of having that monthly expense. If you want to help them save for their own place, give that money back to them when they leave — you don’t even have to tell them that’s your plan as you’re collecting the money.
She’s also wondering about putting herself in debt to help her daughter by a home. We strongly advise against putting your own financial situation in jeopardy to help out your kids. If the money’s not there, it’s not there. Look for other ways to support them.