Hi, Kids! We're Moving In
Would you be comfortable moving in with an adult child? Many fifty-somethings expect to do just that when they retire
The 2024 Pulse of the American Retiree survey by Prudential Financial found that nearly one-quarter of 55-year-olds expect to need financial support from family or friends in retirement — twice as many as 65- to 75-year-olds. One in five expects they will need to move back in with adult children.
That would be a radically new dynamic and may take some adjusting to get it right. Here are tips for families living together in the adult child's house.
1. Be clear about expectations. Discuss where the older parent or grandparent will live and how long they will be there.
"You really do need to be clear about what this living arrangement is going to look like and what the expectations are," says Cathleen Summers, a nurse and attorney at Generations Law Group in Massachusetts. "When you fail to be clear, it really is an open door for tensions."
She hosted a webinar on multigenerational living with her husband Phil Summers, who is also an attorney at Generations Law Group.
2. Talk over household expenses. Will the parent be contributing to household costs? If so, how much and how often?
"We regularly check our clients' parents' finances, and we usually find that they are in worse condition than we thought, or they have a lot more money than they thought."
"Explore ways for parents to contribute," says Justin Pritchard, a certified financial planner at Approach Financial in Montrose, Colorado. "Even if they're not paying market-rate rent, parents may want to contribute something. That might mean paying a modest amount, helping with meal preparation and cleanup, home improvements, childcare or anything else."
Have this discussion before or as soon as a parent moves in with an adult child.
"You really need to discuss upfront who is going to pay for what," Phil Summers says.
3. Be fair about household finances. Make sure expenses are split in an equitable way.
"There is also the issue of whether finances are being fairly shared," Cathleen Summers says. "You end up with someone who is feeling like they are putting more money to groceries, they're paying more of the electric costs, they're paying for the cable television and not really using it. These things can become big issues if you haven't talked them through and thought about them ahead of time."
4. Outline household duties and tasks. How will a parent participate in household tasks? If they are not able to contribute much, will the family hire a cleaning service to help with the additional household work?
"Is there the expectation that you'll be contributing to the household or will someone be brought in to help out?" asks Phil Summers.
5. Set financial boundary lines. If there is a limit to how long you can house an aging parent, you need to be clear about this up front.
"Discuss expectations for how long the arrangement will last."
"What can start as caring for mom for six months after a hip fracture can turn into decades of living with her unless there are boundaries," says Jay Zigmont, a certified financial planner and founder of Childfree Wealth. "There is also a financial limit to how much you can support your parents before your retirement and long-term care are impacted."
Really think over and discuss how long an older parent may live with an adult child and their family.
"Discuss expectations for how long the arrangement will last," Pritchard says. "Is this the plan for the rest of each parent's life, including periods where long-term care is needed? Is it temporary, until Social Security benefits or a pension begin?"
6. Grandparents set personal boundary lines. Any group living situation needs healthy boundaries. As much as a grandparent loves the grandkids, they may need a break from them from time to time.
"Is your privacy important? When is it OK for the grandchildren to barge into your room or apartment? When is it not OK?" Phil Summers says. "Is there a certain way you like things done? Do you like to watch TV at night and like to do it alone or read? Or are you more sociable? Think about your own lifestyle and how that will work with your family."
7. Deep dive into older parents' finances. Once you have set household boundaries, you'll want to take a close look at your parents' financial situation.
"With boundaries set, the next step is to get a good picture of your parents' financial and medical situation," Zigmont says. "We regularly check our clients' parents' finances, and we usually find that they are in worse condition than we thought or they have a lot more money than they thought. Income disparities are rampant in the elderly population, and you need to know which side your parents are on."
Be sure to examine a parent's insurance and long-term care policies.
"Pay particular attention to any insurance policies your parents may have. They may be paying too much for life insurance or other products that they don't need," Zigmont says. "At the same time, if your parents have a long-term care insurance policy, you want to get listed as an additional payer to ensure a payment is never missed. One missed payment to an LTC insurance policy can result in the coverage being canceled, and hundreds of thousands of dollars of coverage lost."
"If your parents have a long-term care insurance policy, you want to get listed as an additional payer to ensure a payment is never missed."
8. Get things in writing. It is a smart strategy to get the details of your new living arrangement with a parent down in writing.
"Write it in a contract or at least write it down so if there's any conflict down the road or misunderstandings, hopefully you had a chance to address the issues in advance," Phil Summers says.
9. Welcome your parents into your home. Be kind when helping your parents move into your home.
"Invite your parent into your home with an open-heart. Emphasize that the parent is wanted and that he/she isn't a burden," says Shira Block, a psychotherapist and author of "When Your Parent Moves In: Every Adult Child's Guide to Living With an Aging Parent."
"Change your routine to include the parent rather than have the parent as a side thought," she advises.
10. Adjust the plan as needed. Multigenerational living can work great for a family. But if anything changes, such as the older parent having financial or health issues, you may need to make changes.
"It really can be an incredibly positive experience for everyone," Cathleen Summers says. "You just have to have clarity about things and an ability to openly communicate and adjust the plan as time goes on."
Continuous, open communication is key.
"Keep the lines of communication open and be ready to make adjustments as time passes," Block says.
