Home sweet home for adult kids

Skyrocketing rents and high property prices prevent many young people from striking out on their own

“He’s 18. He’s finished school. I’ve done my job to get him there. It’s up to him now,” a friend of mine told me recently.

I understood where she was coming from, but my experience is that parents are still involved – particularly financially – in the next phase of their kid’s life from 18 up to when they establish themselves in the workforce. Most likely she will have him living at home for several more years.

In fact, even after your kids have finished studying, they may still be living at home, according to census data. Around 50% of all 20- to 24-year-olds still live in the parental home, up from 33% in 1981. Men are more likely to stay at home than women.

Young adults are facing greater financial burdens and uncertainties. There is a shortage of affordable housing, rents are rising and financial issues, such as tertiary education debt, mean they are reluctant to move out of home.

Often parents provide valuable financial and emotional support to their adult children while they save money and work on their career. It can be a mutually beneficial arrangement for both parents and adult children.

Parents are typically generous when it comes to their own children and some provide food and pay utility bills. They lend them the family car, not to mention doing their laundry, their cooking, and their share of the housework.

Parents feel the pressure

Older parents who had their kids in their late thirties or even their forties feel the pressure to keep working to help support their twenty-somethings. And unless they make it clear otherwise, their adult children expect the generosity to continue.

Adult kids may assume their parents are well off, but this isn’t necessarily the case. Parents should not neglect their own retirement savings and plans.