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How to Set Money Ground Rules for a Boomerang Kid

If your adult child is about to move back home, follow these four rules to keep your finances and family intact

By Geoff Williams

As some parents have been discovering lately, just because your kids have grown up, that doesn't mean they’ve moved out. If your adult child has boomeranged back into your home, you'll need to set money ground rules – or likely face tension under your roof.

It’s hardly unusual for boomers to live with boomerangs these days. A Pew Research Center survey last year found that 13 percent of parents with grown children had at least one of their adult sons or daughters return to the nest. And the recent Clark University Poll of Emerging Adults noted that today's young adults frequently receive financial support, if not lodging, from their parents.

(MORE: Best Ways to Comfort Your Unemployed Adult Child)

Little surprise that ABC recently aired How to Live With Your Parents (For the Rest of Your Life), a TV sitcom, albeit short-lived, that reflected the boomerang phenomenon.

4 Money Tips for Parents of Boomerang Kids

Since your finances and feelings could take a hit if your adult kid moves in, here are four tips from experts to help keep your boomerang situation from blowing up, manage the relationship wisely and foster your son or daughter's step into adulthood:

1. Negotiate expectations together. This can be tough if your offspring just shows up on your doorstep one day, begging to be let in. But with some notice, this discussion will be helpful for all concerned, says Suzanna de Baca, vice president of wealth strategies at Ameriprise Financial.

You’ll need to decide whether you'll: charge rent (if so, how much) and require contributions to the cost of grocery and utility bills, gas for the use of your car, his or her cell phone bill (perhaps on a family plan) and any student loans. In addition, you'll want to agree on the household duties, if any, your child must handle.

"There's no hard and fast rule on what you should charge your adult kid for staying with you,” says Jeffrey Jensen Arnett, a Clark University psychology professor and co-author of the new book, When Will My Grown-Up Kid Grow Up? Loving and Understanding Your Emerging Adult. “That would be presumptuous for me or anyone to declare. It depends on the parents' financial situation."

If you want to cover your child’s living expenses but don’t want to do so indefinitely, you might set a time limit on your generosity – like three months, six months or a year. That’ll keep your own finances from spiraling out of control and ensure your kid keeps his or her dignity.

Keep in mind, though, that your time is valuable. So if you’ll resent the thought of doing your kid's laundry or cooking meals, don't agree to it, says Don Grant, a certified financial planner in Wichita, Kan. Just be sure to establish early on that, as an independent adult, he’s on his own when it comes to these types of things.

When a grown child moves in, "you're not just 'parents,’ you become adult roommates," Grant says. "The parent role will always be there, but independence is the goal."

2. If you want your child to help shoulder costs, keep your ultimate goal in mind. It's a simple one: You want to help your kid — but you want him or her to move out eventually.

So this isn't the time to make like a Three's Company episode and summon your inner Stanley Roper, the overbearing landlord. The more you charge, Arnett says, the longer it’s apt to take your son or daughter to save enough money to move out.

(MORE: 11 Essential Money Tips for New College Grads)

"Don’t charge rent so high that it will be a while before your emerging adult can live independently again," he adds.

In other words, if you'd charge a stranger $200 a month to rent out a room, ask your kid for $50 or so — assuming he or she has an income, savings or job prospects.

3. Keep financial arrangements businesslike. If you plan to charge rent or offer a short-term loan, you might want to write up a contract with a repayment schedule, says Tina B. Tessina of Long Beach, Calif., a psychotherapist and author of Money, Sex and Kids: Stop Fighting About the Three Things That Can Ruin Your Marriage. The document could also note your plan to assist with the first month's rent or security deposit when your child is ready to move into an apartment.

Aside from eliminating any confusion about the rules, a written agreement can help ensure your other children won't feel their sibling is getting special treatment. It can also prevent a low self-esteem problem with your boomerang kid, who might otherwise feel like a charity case, Tessina says.


"It is important for the adult child to know that housing is not free," says Donald K. Freedheim, a clinical psychologist and professor at Case Western Reserve University. If your son or daughter doesn't have money for rent now, Freedheim says, you could instead offer a loan to be paid back eventually.

(MORE: Options for College-Dropout Boomerang Kids)

Some parents will roll their eyes at the thought of drafting a contract for their kid’s rent, believing that’s not the kind of thing a parent should do.

But it really comes down to how responsible your grown child is and your relationship with him or her. If you’re certain your kid won’t take advantage of your generosity and you’ll even enjoy having him or her back home for a bit, you may be able to dispense with a contract and rent.

4. Be careful about butting into your child’s finances. If your adult son adds to his comic book collection or buys a used iPod and you think that’s unwise given his current state of affairs, hold your tongue.

This type of inexpensive purchase might be just what he needs to brighten his spirits.

Now, if he's about to sign a lease on an expensive car while you're footing the bill for his rent and food, that’s a different matter. In that case, a frank conversation is probably in order.

But in the interest of not saying something you’ll later later regret, Freedheim recommends speaking to your grown kid "in an adult, mature way and not like a scolding parent."

For instance, you could take your daughter out for coffee and discuss her money situation like peers. If you try to have a meaningful discussion about finances just as she’s going out the door to see friends, both of you might suddenly feel like you've set the clock back to her high school days all over again. And you don't want that.

"The important thing is that both parties not regress to the former child-parent relationship that repeats childhood conflicts," Freedheim says.

Constance Stone, a certified financial planner in Chagrin Falls, Ohio, says you'll probably have a much more harmonious and cooperative relationship with your boomerang kid if you avoid criticism. Instead offer compliments when you see him or her doing something positive that may lead to financial independence. "It's better to be happy than right,” Stone says.

Geoff Williams lives in Loveland, Ohio, with his two daughters and has written for media outlets including Next Avenue, Reuters and U.S. News & World Report. His book, Washed Away: How the Great Flood of 1913, America's Most Widespread Natural Disaster, Terrorized a Nation and Changed It Forever hit stores in February.

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