Nearly a quarter of millennials (22 percent) are living with their parents, and more than half of those living with them (55 percent) made the move in 2022, according to a December survey from PropertyManagement.com.
Many said they’re back home due to high rent, money concerns or job losses—and 9 in 10 say they would move out if they made more money.
“It can be very frustrating for the parents and the young adult to be in a more dependent position than what their age dictates,” says Mariana Martinez, senior family dynamics consultant and vice president for Wells Fargo Wealth and Investment Management. “It is useful to keep in mind that there were extraordinary circumstances that led them to their current situation.”
1. Get Clear on What You Want
“I ask every client I work with, ‘What are your goals, what are you trying to accomplish?’” says Angela Moore, a financial literacy educator and coach with Modern Money Education. “And most people do not know. They’re trying to wing it.”Write down your intentions. Do you want to get an apartment? Buy a house? Do you want to stay in the same city? Do you want a better-paying job?
2. Make a Spending Plan
Use whatever tool you like—an app, spreadsheet, etc.—to design a budget. How much do you have in savings versus debt? What are your monthly expenses? What needs to change to help you achieve your goals?“Find out what you need to do and how much you’re going to need in savings or money or income to make the changes needed,” Moore says.
Use your circumstances to your advantage—but that doesn’t mean endless shopping sprees.
“I have a client who is in this situation and the allure to still live ‘the successful’ lifestyle is strong,” says Kyle Newell, a financial adviser in Winter Garden, Florida. “Saying no to going out or finding alternatives to still have fun is key.”
3. Build an Emergency Fund
Before you fly the coop, save up a cushion of three to 12 months of living expenses. If the numbers feel overwhelming, start with one month and aim to build up to three months. This might feel like overkill, but it’s a crucial safety net.4. Brainstorm Ways to Increase Income, if Needed
If money is an issue, you’ll have to take steps to bump up your numbers, whether that’s asking for a raise, looking for a new position or taking on a side hustle.5. Consider Housing Alternatives
In some cities, soaring rent paired with a competitive market have made it hard to find an affordable place to live. You may need to think outside the luxury condo or consider a roommate to make it easier for you to pay the rent on an apartment or house.“We’re seeing more and more people that are partnering up with same-age people,” says Dennis Nolte, a certified financial planner in Winter Park, Florida. “My 26-year-old stepson, who moved back to central Florida—he’s got four roommates from his church and they’re all about his age and they all have jobs.”
With the pandemic boost to remote work, you may also be able to move somewhere cheaper to set up shop.
6. Communicate
Even if you have the world’s best parents, moving back in with them might not have been the ideal living situation you—or they—envisioned for yourself. The arrangement can be stressful, so it’s key to keep them updated on your goals and your progress.“Keeping open and honest communication between the two parties is super important,” Martinez says. “The more transparent you are, the less frustration there is, because you know the person is doing what they can to change the situation.”
