Are Your Adult Children Living at Home?

How my parents’ wise rules (and kicking me out of the nest, but in a nice way, years ago) helped me become financially independent.

A mother and daughter drink coffee at home
(Image credit: Getty Images)

What kinds of rules can parents put in place for their adult children living at home to ensure they can launch successfully? This question is more relevant now than ever before. More young adults were living with their families in July (52%) than the previous high just after the Great Depression (48%), according to a Pew Research Center analysis of Census Bureau data.

Any parents struggling with this new reality might benefit from my own family’s experience a few years back as I got started on my career path. Let’s just say that after college, I needed a little extra push to try new things and spread my wings. I’m a worrier by nature and avoid change like the plague. The comfort of home was just that – probably a little too comfortable. In my head, I was saving money for my future by not paying rent, depending on my parents a little too much, and enjoying not having to be on a budget. But if you aren’t living independently – even while saving money – you never have full responsibility.

Living away from home while in college wasn’t the same. I needed to learn how to create a real budget, start saving for my future, and do all things adult. What follows is not a one-size-fits-all plan. But these guidelines are what I needed so that I could continue to grow into a more responsible person.

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Luckily, my parents knew me only too well – and hence comes Rule No. 1.

1. Set a timeline for living at home

From the moment I moved home, we had an agreement that after a year it would be time for me to live on my own and find an apartment – and I should not plan on coming back. I was asked to decide on an appropriate time frame and stick with it.

Man, did that year come fast! But my dad helped hold me accountable. A month before the year mark hit, we started looking for apartments. I didn’t want to live alone (and frankly couldn’t afford it), so I found a friend to live with. And so began the need for a budget.

2. Help your kids develop a budget

Even before moving out, help your child start tracking their spending – you might suggest they try or an old-fashioned Excel spreadsheet. They should figure out how much is essential spending (phone, car, insurance, etc.) vs. fun spending (eating out, shopping, hobbies, etc.) – then figure out how much they have left for rent.

Or even better: Have them practice “paying” rent to a savings account to build up that emergency savings fund for a couple months before they move out. The goal is to have a set amount for each category in their lives and then try to stick to it. This should include adding a “miscellaneous or fun buffer” because random purchases (coffee habits or those spur-of-the-moment Amazon purchases) can add up!

3. Require a savings plan based on goals

Normally with first-time jobs comes a smaller salary, so there’s not a lot of wiggle room for savings – but those starting out should start small, make it automatic, and then build on it.

Working at a financial services firm, I got plenty of advice on how to get my savings going. JC, my boss for the last 13 years, told me early on to start contributing to my 401(k) even if it was a small amount. His advice was to increase my deferral amount as my salary increased, so each time I received a raise he’d remind me to bump up my 401(k). I’ve stayed true to that strategy, and it’s helped compound my retirement savings.

The message is, if it’s not a 401(k), then save for that next car, a house, a big trip – whatever is on your goal list. But starting a retirement savings account is a must. If your kids don’t have access to a 401(k), then they should start an IRA or Roth IRA. Their older selves will thank you!

The ultimate upshot: Gratitude

These were just a few of the tips that my parents and mentors instilled in me. I plan to use them with my own children. To enable them to continue to grow, we need to push our children out of their comfort zones, even if it’s not what they want to hear. Many years later, I am thankful for these life lessons.


This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Kelli Kiemle, AIF®
Managing Director of Growth and Client Experience, Halbert Hargrove

Kelli Kiemle holds multiple roles with Halbert Hargrove. As Managing Director of Growth and Client Experience, she sets the tone for the quality and character of Halbert Hargrove's client service relationships. She also manages the associate wealth advisers and client service managers. Kelli is also responsible for overseeing the firm's wide-ranging marketing and communications initiatives, including their mentor program.