Adult Children Returning to the Nest?
Published: Wednesday, June 20th 2012
One of the casualties of the Great Recession has been parents’ much-anticipated empty nest. “Susie can’t get a job after graduation and she’s coming back home until she gets on her feet.” It’s a refrain that is becoming all too familiar across the U.S.
“Reoccupy Elm Street” is in full swing, and it’s up to you and your spouse to shore up your defenses. What’s on the line? Your own financial security and long-awaited plans for retirement.
Establish Firm Ground Rules
On one hand, you want to help your child. On the other, you need to keep an eye on your own wallet. You also want to empower your child and not contribute to his or her helplessness.
If your child is over 18 and comes back home after graduation, try to objectively assess his or her situation and your own, which can be difficult. However, if you want to reclaim your empty nest, it’s critical to lay down some important guidelines sooner rather than later.
The Rules Have Changed
He may be your child, but he is no longer a kid, and you expect him to behave like the young adult he is. When he was younger, it was fine for you to support all his financial needs.
However, this is no longer the case. He now needs to pull his own weight in terms of contributing to the household — both financially and logistically, to whatever degree he can.
For all the dismal employment headlines, one fact remains crystal clear: people with college degrees have a lower unemployment rate (4%) than those without a degree (8.7%), according to a release from Bureau of Labor Statistics at the beginning of 2012.
If your child is entering college, take an active role in helping her select a course of study and degree choice. Make sure it is something marketable. Nursing — yes. History of basketweaving — no.
Make it clear that your child is expected to work. Even if your child can’t get her dream job now, she should look for some kind of job to pay for her own expenses, such as gas and entertainment. If your child is employed, but wants to live at home because she has student loans, help her make a savings plan, as well as a payment plan, for the debt. Giving the gift of a financial plan will save you money in the long run.
Make sure you have a timeline for how long you expect your child to be with you. Perhaps part of the plan can stipulate that for a certain amount of time, perhaps six months or so, you will help him financially, but after that any money spent on his behalf can be considered a loan.
It may sound harsh, but this might motivate junior to think with more clarity and speed about what he needs to do to grow his wings and fly the coop. In addition, if it’s structured properly, it could benefit both of you on your taxes. Consult your tax provider for more details.
Productive Member of the Household
She should wash her own dishes and clean up after herself, do her own laundry, help with other chores whenever possible, and abide by any other rules set by you and your spouse.
Think About Your Future
It may not be easy enforcing all the rules, but it’s necessary. Naturally, you want to help your child, but remember not to lose sight of your own needs, especially in this stressed economy.
You and your spouse have put your children ahead of yourselves for years — it’s not a good idea to do this any longer. It could put a strain on your current budget, or worse, postpone the retirement that you and your spouse have been looking forward to for so long.
Marina Goodman, CFP, is an Investment Strategist at Brinton Eaton, an SEC-registered wealth advisory firm in Madison, N.J. She can be reached at firstname.lastname@example.org.
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