Life as a Boomerang Kid

Hmm. Dirt-cheap housing. Home-cooked meals. A full-time housekeeper. The catch: sleeping in your old room.

If the thought of moving in with your parents has crossed your mind, you aren't alone. More than half of all college seniors move back home after graduation each year. In fact, according to the U.S. Census Bureau, about 18 million young adults ages 18 to 34 now live at home -- a 42% increase since 1970. That group includes men and women, singles and marrieds, new grads and seasoned professionals, and many who never even left.

While some are drawn home by family issues such as a divorce, illness or death, financial issues are the most popular reason. Consider this: The median household income for adults ages 25 to 34 has risen only 7% over the past five years, yet the nation's median home price has jumped 48%. Student loan and credit-card debt among twentysomethings are also on the rise. No wonder so many of us are having a hard time getting ahead.

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Whether you join the throng of so-called "boomerang kids" is largely up to your parents. For example, my dad would lecture us at the dinner table that once we moved out on our own, we were OUT. He loves when we come home to visit, but living there is completely out of the question. My husband's family, on the other hand, is the opposite. His parents begged us to live with them after we got married. We declined, but they have welcomed three of their other four children home over the years.

While making the move home can be a good way to make ends meet while you look for a job, save up for your own place, chip away at your debt, or recover from a breakup or failed business venture, you (and your parents) don't want the living arrangement to become permanent. It's important to plan your return to an independent life from the start, before you can even say, "Mom, I'm home!"

Plan your comeback

First identify your purpose for moving home. Is your goal to find a job? Pay off debt? Save for a house down payment? Go to grad school? Write down your goal and post it somewhere in your old room so you'll see it every day to help keep you motivated.

Then decide how long it will take to reach your goal. A timeline isn't just for Mom and Dad's sake. "It's just as important for you," says Elina Furman, author of Boomerang Nation: How to Survive Living With Your Parents the Second Time Around. "Without a clear goal or time limit, it's very tempting to defer looking for a job, saving money and finding a new place to live." Without a target, Furman says, you're much more likely to procrastinate and live at home even longer.

Discuss your goals and timeline with your parents before moving in, being sure to stipulate how long you plan to stay. Be open about your situation so you can come to an arrangement that works for everyone.

Set financial goals

If you don't have a budget, now is the time to start one. (Use Kiplinger.com's Budget Worksheet for a blueprint.) Figuring out your monthly expenses under the new arrangement will help you anticipate how much money you'll save and come up with a realistic timeline.

If your aim is to pay off debt -- whether student loans, credit cards or other obligations -- our calculator will show you how much time and money it will take. If your goal is to save a certain amount of money, we've got a calculator for that, too. (For ideas on where to stash your savings, see Build Your Financial Foundation.)

Once you have a plan, you've got to stick with it, or you blow the whole advantage of living at home. "Since many of us are living rent-free and have more discretionary income than we're used to, it's not unusual to indulge in a few splurge fests," says Furman. In fact, many boomerangers actually end up spending more once they move home. It's easy to rationalize that new laptop computer, a shiny SUV, a tropical getaway, lavish meals or a designer wardrobe when you finally aren't merely scraping by. But don't give in. Stay focused on your goals. After all, says Furman, you're lucky enough to get a chance to regain your financial footing. You shouldn't waste that opportunity.

Other money matters

You may be sleeping in your old room again and dining on Mom's meatloaf, but you shouldn't expect to mooch 100% off your parents' generosity. After all, they've got their own retirement and other financial goals to worry about. You wouldn't want to derail their efforts. You should plan to pitch in financially to the household.

If you have a job and are making money -- no matter how little -- offer to pay a token amount of rent, say, 10% of your paycheck. Parents: Even if you don't need the money, you still should charge your kids rent to keep them focused and encourage budgeting, says Janet Bodnar, author of Raising Money-Smart Kids and columnist for Kiplinger.com. If you really don't want the money, set it aside to help your child pay for a security deposit on an apartment or a down payment on a house. Or use it to make a surprise contribution toward their student-loan debt on their birthday. Get more advice on being a parent to a boomeranger.

You should pitch in toward other household costs, too. You should pay your own phone bills and contribute toward food, cable and utilities. If you're using the family car, you should pay for your own gas and insurance, too. Even with paying a token amount of rent and making small contributions here and there, you're still saving a bundle over what you would in the real world. (See our Cost-Of-Living Reality Check.)

If you don't have income, offer to pay in the form of service, says Bodnar. You can cook meals, mow the lawn, run errands or take over household cleaning responsibilities.

Non-financial matters

Before you set foot in the door, discuss non-financial expectations with your parents, too. Will your mother want you home for dinner every night? Is there a curfew? Can you have friends over or overnight guests? What about rules for smoking and drinking? How can you ensure your privacy is respected?

Put this in writing, as well as your timeline and your household financial obligations, to ensure everyone is on the same page and to avoid friction should an issue arise. This is as much for your peace of mind as it is for your parents'. In fact, if you approach your parents with a draft in-hand, they'll see how serious you are about making this arrangement work that they might be less apprehensive about welcoming you home and more open to negotiating the terms in your favor. See Writing a Contract for Boomerang Kids for more information.

Don't forget to consider the impact the move will have on your social life. "It may feel as if you're in social Siberia," says Furman. If your friends are living it up in the city while you're chilling on Mom's couch, you need to come up with a plan to stay connected. Or you may need to look for other social outlets close to home.

And then there's your love life. If you're moving home and bringing a spouse, make sure he or she gets along with your parents, and that you both agree on your goals and time frame. And if you're single, nothing puts a damper on a budding romance like these five little words: "I live with my parents." Perhaps that's all the motivation you need to stick to your timeline and get back on your own two feet as soon as possible.

See also: Advice for Parents of Boomerang Kids