PITTSBURGH — After four years at the University of Pittsburgh earning a bachelor’s degree in athletic training, 21-year-old Shannon Renninger graduated last weekend, and like many of her classmates, she will find herself moving back into her old bedroom in her parents’ house until she can get her career off the ground.
“I feel good and bad about it,” said Renninger of Quakertown, Montgomery County, who plans to live at home while pursuing a master’s degree in athletic training at East Stroudsburg University in Monroe County.
“I don’t have to pay rent or utilities and they feed me,” she said. “But I also feel like a burden. I know I can do well on my own, but it’s just a little more convenient to live at home. My mom loves the fact that I’m coming back.”
For many families, the month of May tends to be the boomerang season. Parents who thought they had successfully launched their children from the nest four years ago will soon be faced with young grads who move back home after getting their degrees. That could add to the financial stress many households already are experiencing.
Young adults are more likely in today’s economy to rely on parents to contribute to major expenses, such as cars, groceries, rent and credit card bills. And a growing number are falling into a category called “boomerang kids” — children who were on their own and for various reasons move back in with their parents.
According to the Pew Research Center in Washington, D.C., young adults are driving the steady rise in multi-generational households. A record 57 million Americans, or 18.1 percent of the U.S. population in 2014, lived in households with more than two generations of adults — double the number in 1980.
The Pew study attributed the trend to a large loss of employment for young adults during the Great Recession.
Researchers found young adults age 25 to 34 have been a major component of the growth seen in multiple generations living under one roof. The trend has been especially strong since 2010 and is apparent across genders and among most racial and ethnic groups.
In the 15 years that Adam Yofan has been advising clients on managing their assets, experience has shown him that parents are more likely to scale back their financial support of adult children rather than outright eliminate it — despite his best efforts to convince them that they may need the money for retirement.
“Clients underestimate health care costs dramatically. They may spend $250,000 in health care costs alone during retirement,” said Yofan, president of Alpern Wealth Management. “When we give them that information, parents tend to dial back the support. Instead of giving the child $10,000, they will give $2,000.
“Not only is a parent’s financial future in jeopardy, their health is, too,” he said. “They will end up skipping doctor’s appointments and medications because they won’t have the money.”
Not all graduates plan to lean on their parents’ financial support after crossing the graduation stage.
Anthony Mianzo, a 27-year-old marketing major, attended Pitt on the GI Bill after serving four years in the Army. His veteran’s benefits covered all of his tuition and books and provided a housing allowance. Rather than going into debt, he was able to save money.
“I don’t have the stress,” said Mianzo, whose parents live in Plum, Pa. “I set myself up for success.”
Mianzo said he has some federal job interviews lined up. The lease on his apartment does not end until July, and he hopes by then to have a job with the federal government. If not, he will find work that will at least cover his living expenses until he gets the job he’s looking for.
“I know several people who plan to go back to living with their parents,” he said. “They don’t seem to care as much. It’s more commonly accepted now.”
Shomari Hearn, a certified financial planner with Palisades Hudson Financial Group in Fort Lauderdale, Fla., said parents should re-evaluate their finances when an adult child moves back in to see how having an extra mouth to feed affects their cash flow.
“Don’t let yourself get into financial trouble because you failed to reassess your own budget while helping your child,” Mr. Hearn said. “This holds true of all sorts of gifts, but it can be harder to say no when you share a living space and witness your child’s struggles firsthand.
“If your child has a job, strongly consider charging rent,” he said. “That will help them responsibly manage their money. If you don’t need the money, you can place it in an account that can be used for your child’s future needs.”
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