Finance for Boomerang Families

How to ensure financial support doesn’t lead to chronic mooching.

The face of the modern American family has certainly changed recently. From higher rates of divorce and new definitions of family to new trends like boomerang families, there are financial situations that American families face today that don’t fit the traditional mold. As a result, they need specialized financial guidance to help them succeed.

A boomerang family is a relatively new trend that gained traction during and after the Great Recession. This is where adult children move back home after leaving the nest for college or their first job, only to come back within a few years because they cannot support themselves on their own. The concept certainly existed before the Great Recession, but high youth unemployment rates combined with issues like overwhelming student loan debt have left many young adults stuck at rates that had never been seen before.

The information below is designed to help parents with boomerang kids that have moved back in the house. It helps you navigate the tough financial environment the situation can create in your household, so you can avoid conflict and ensure you’re helping without becoming a crutch. If you need help or the added financial burden is proving too much for your outlook, we can help. Call Consolidated Credit today at or complete an online application to request a free debt and budget evaluation with a certified credit counselor.

Tip No. 1: Set ground rules early

The first mistake parents usually make with boomerang kids is that they don’t set ground rules for how the financial situation will work in the house early enough. Remember, your adult children are pretty much conditioned to rely on you when they’re living in your house. When they were coming from school or for a visit, you probably prided yourself on pampering them.

However, moving back in is another situation entirely. Relying on you completely for money, food, housing and utilities isn’t doing them any favors – it’s just reinforcing the idea that you’re happy letting them mooch.

If your children move back in, you need to set expectations immediately. Discuss how they’re expected to contribute, what bills they’ll be expected to cover on their own, and how much effort your expect them to put into looking for jobs every day.

Tip No. 2: A job search should be a full-time job

Allowing adult children to sleep in because they don’t have anywhere to be in the mornings is only making it easy for them to continue to rely on your support. You should see them working to apply for jobs, going out on interviews and hitting the pavement to find opportunities. If you don’t, then you shouldn’t feel bad about asking what they’re doing to find a job – you may feel like you’re hassling them, but the alternative is allowing them to stay with you indefinitely.

If your child has a job, but it’s not enough to pay their own way, then at least some of that money should be put towards the household budget. They should also be setting a portion of every paycheck aside to prepare for things like a deposit on future housing.

Tip No. 3: Part-time is better than no-time

Adult children may have the same resistance to getting a filler job that any adult would – they just spent all that time and effort getting a degree or working to advance their career, only to find themselves back at square one, having a hard time getting off the ground.

If your children can’t find gainful employment within their chosen career field within the first 1-2 months, then they need to get a part-time position to help with the household finances. Even if you have the means to support them fully without them working, doing so is only encouraging them to leave the work to you while they enjoy their leisure.

Ideally, they can get a job relevant to their real career path while they look for full-time employment. However, even if that’s not possible, getting any employment will help with the household budget. In addition, remind them that it will make them look better to potential employers if they’re working while looking for the perfect job.

Tip No. 4: Extras are their responsibility

Any luxury expenses should be your children’s responsibility to cover – and they should cover those expenses AFTER they’ve contributed to the household budget for things like groceries and utilities. This includes things like mobile service, expanded cable or satellite packages, gaming or movie and music streaming accounts, gym memberships, salon visits, non-job-search related clothing, and the list goes on.

If it’s not necessary for their life or helping them find a full-time job, then it’s something they should cover on their own or live without until they have the means to pay for it.

Tip No. 5: You are not a source of startup capital

When children struggle to find their dream job, in some cases they may decide that they’d be better off starting a business of their own. That ambition is great, but starting a business is a huge responsibility and takes more work and effort than most regular 9-5 jobs where you work for someone else – it’s not an “easy out.”

It also shouldn’t be something they do on your dime. If you have to invest a significant portion of your own income or cash out assets to get their business off the ground, it’s probably not a good idea. It puts your financial stability and future at risk for a venture that may or may not end up being their true passion. Most adult children haven’t worked long enough to really know where they want their professional life to go. Using your assets to fund their money-making schemes is a risky proposition for both your money and the peace in your home.

Tip No. 6: Don’t sacrifice your own future

Even if they aren’t asking for startup capital for a business venture, any path where you end up cashing out assets that were meant to support you in the future so you can support your adult children now is a risky path to take.  If the choice is between your child getting a full-time hourly job versus you cashing out a 401(k), the first choice should always be made before the second option is ever considered.

Make sure to protect your own interests and financial future even as you support adult children. Remember, risking your own financial stability now may mean that you’ll be ill equipped for retirement – which in turn means you might end up financially dependent on them in a few years, making it harder for them to reach their own financial goals like homeownership. It’s better for everyone in the long run if your assets are protected.

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