When to Kick Your Kid Out of the House

[Joseph V]

Children are a long-term investment. But who knew it would be this long?

The tab to raise a kid in a middle-class household through age 17 is around $184,000, according to the U.S. Department of Agriculture. If the child then spends four years at a prestigious private college, you might cough up an additional $160,000.

Think the financial bleeding ends there? Think again. These days, we're talking graduate school, allowing the kids to move back home after college, covering the rent on a first apartment and maybe even buying it for them. Should parents really be forking over all this money -- and where do they draw the line?

Heading home. Like it or not, it's taking longer for adult children to become financially independent. One indication: As of 2001, almost four million 25-to-34 year olds were still living with their parents, according to a 2002 study by Harvard University's Joint Center for Housing Studies.
What's driving this trend? Many kids are taking five years to get an undergraduate degree, they're going on to graduate school, they are working as poorly paid interns, they are slow to settle on a career, and they can't afford to buy their own home because of lofty real-estate prices.

But it isn't just about the kids. Parents not only have the money and the room to keep their adult children at home, but also many enjoy having the kids around, in part because it helps them put off unsettling thoughts about their own mortality.

"There are a lot of reasons why children might still be at home in their 20s," says Jerrold Lee Shapiro, a licensed clinical psychologist and a professor of counseling psychology at Santa Clara University, Calif. "But the danger is that they never grow up."

Indeed, for parents, there's a difficult balancing act involved. Studies in Europe have found that young adults who get a lot of parental support tend to be more optimistic, more ambitious and more adventurous in their career choices, notes Terri Apter, author of "The Myth of Maturity" and a social psychologist at Cambridge University in England.

But if you provide too much support, there's a risk you will end up with an overly dependent child who has an unpleasant sense of entitlement -- and you could torpedo your own retirement plans.

Finding their feet. What to do? To help your adult children as they strive for financial independence, try these four strategies.
--Talk about your own struggles. Today, your kids likely view you as affluent and successful. In all likelihood, however, you had lean years after college, including difficulties landing a job and trouble covering the bills. Your kids will have similar struggles -- and they need to know that.

-- If your adult children ask to move home, immediately draw up a plan with your "boomerang kids." Nail down what they will do to pursue their desired career, how they might earn money in the meantime and when they will leave.

"Their job is to take steps to move into adulthood," says Cambridge's Dr. Apter. "Their job isn't to hang out and see what happens. If you've had a young, healthy adult at home after college for over three years, you have to ask, 'Is this in everybody's best interest?' "

-- Treat your adult children like adults. When they move back home, they should take on responsibilities, including paying rent, cooking and cleaning.

But this can be a little tricky. You want your kids to behave like grownups -- but you don't want to impose a slew of restrictions, effectively dealing with them as though they're children.

"What are the proper rules for your 24-year-old son?" Prof. Shapiro asks. "You have to treat him as the adult that he is and that you want him to be. You encourage independence by giving people freedom."

-- If you help your kids financially, aim to leverage your investment. "If parents have the money and they want to help, they should structure it as a partnership," advises Eileen Gallo, co-author of "The Financially Intelligent Parent" and a psychotherapist in Los Angeles. "That can empower the child."

For instance, if your children want to go to graduate school, you might insist that they take out loans to pay for at least part of the expense. That way, there's a real cost to staying in school -- and a real financial incentive to complete the degree and parlay it into a decent-paying job.

Similarly, if you initially subsidize your children's rent, you might slowly scale back the subsidy, while offering to match any home down payment dollar-for-dollar. That will have the double benefit of both weaning your kids financially and also encouraging them to sock away money for their first home purchase.

Don't, however, give your kids money you can't afford. For parents, it might seem logical to carry on as the big breadwinner for the entire family. After all, you're the one with the big salary, while your kids may be earning precious little.

But if, like many others, you have put off saving for retirement until your last 15 or 20 years in the work force, you really need to use your spare cash to fatten your own nest egg. That doesn't mean you can't be supportive of your kids. But your support may have to be more emotional than financial -- and that, in any case, is the most valuable kind.

Originally Posted by Joseph V

The tab to raise a kid in a middle-class household through age 17 is around $184,000, according to the U.S. Department of Agriculture. If the child then spends four years at a prestigious private college, you might cough up an additional $160,000.

I think this paragraph needs to be printed on every single box of condoms sold in the US.

[Binx]

The sum that Joseph mentioned is based on a child who attends public school from pre-school to 12th grade. Add another $4,000 each year they are in school if you intend on sending them to private school.

[VALI714]

Originally Posted by -m-

I think this paragraph needs to be printed on every single box of condoms sold in the US.

hahahaha

[Nyteshade]

I think this paragraph needs to be printed on every single box of condoms sold in the US.

I would agree except that if you are buying condoms, then you already have the right idea.

[Left]

shit,
my parents have helped me with a LOT of shit,
but once i finish 4 years (graduated or not), i'm out on my own with a fat student loan.

[PETA]

Originally Posted by -m-

I think this paragraph needs to be printed on every single box of condoms sold in the US.

don't make me agree with you again any time soon.....


but damn that was funny

[Hey Bubu]

Miles, that should be tattoed on every womans stomach and back....

[stellar faze]

This whole article is practically the same issue that I have. Not that this would change anyones life. boh!

[Big Andy]

Some good points, for sure.


BUT, keep in mind how much more quickly property values and cost of living have risen over the last few decades compared to how much we make. I've seen numbers somwhere in the area of cost of living expenses increasing ten fold while wages only increased 4 or 5 fold, for the same period of time. Less than a century for sure.


I mean, my parents talk about getting food for pennies on the dollar compared to food prices these days.


So I'm sure there are plenty of other reasons people are taking longer to become financially independant, but the changes in our economy I'm sure are the biggest reason. When the thirty somethings on this board were graduating high school, it was easier to make ends meet on a waiter's income.

[SenseOfCommons]

This is true Andy.. as generations come upon us, there are several factors to consider. I mean, damn, if I was living in the 70s in the same situation I am now, then I would be doing alright with no worries. I would be the cream of the crop! Unfortunately, as much as I love the computer age, we are all categorized and profiled much like cattle these days.. every single flaw or mistake is held against us on our record and further ousts us from moving ahead.

On another note, I know many foreigners who don't even understand this method of dealing with youth. Mostly, I hear from them that they are willing to help out their children until they are completely stable and able to make a life of their own.. even if it means keeping them at home until 25 - 30 - 35 or whatever. If I had children of my own, I would want to take the same approach. I would want to nurture their growth for as long as possible so that they would have a comfortable future.

Sure, there is much to be said for gaining character through turmoil... this is the life I have lived personally, but if you teach your children as much as possible about what is wrong with the world, then you may just succeed at giving them the right "stuff" for life. Hell, and just maybe they won't have ruined their credit by the time they are 21 by living with irresponsible roommates.

Oh.. and PS.. I don't really know about 35.. hopefully between 25 & 30, they would get to experience enough to not want to be at home anymore. I do have some limitations on the non-american outlook.

[PETA]

Originally Posted by Big Andy

Some good points, for sure.


BUT, keep in mind how much more quickly property values and cost of living have risen over the last few decades compared to how much we make. I've seen numbers somwhere in the area of cost of living expenses increasing ten fold while wages only increased 4 or 5 fold, for the same period of time. Less than a century for sure.


I mean, my parents talk about getting food for pennies on the dollar compared to food prices these days.


So I'm sure there are plenty of other reasons people are taking longer to become financially independant, but the changes in our economy I'm sure are the biggest reason. When the thirty somethings on this board were graduating high school, it was easier to make ends meet on a waiter's income.

our parents generation did not see the phenomenon of "extended adolescence" the way Gen X pioneered... and subsequent generations have apparently perfected. Its not entirely a result of increased costs but partially from an unwillingness to sacrifice a standard of living....(it was referred to as the "privileged poor" back home - a phenoenon commonly discussed in our version of the Observer - though that group was more highly educated people working coffee house jobs and living in dive apartments but otherwise resembling the description to follow....) how many twenty somethings live at home, pay no rent or costs for food etc but have kick as cars, great stereos, go out 5 nights a week, have every new game platform the week it comes out (plus 100 games for each), a stack of CDs 1000+ thick, great stereo to play it on etc etc - it happens pretty commonly - and parents of course enable it so they share a measure of critcism