The high cost of living and home prices may mean that your home has become one of many countries. For many young adults, living with their parents alleviates concerns about high prices and job insecurity.
But retirees may worry about high grocery bills and utility bills affecting their savings and monthly budget when a child comes along. Here’s how to support your older children while keeping your nest egg in shape.
Why do older children return home?
High living costs, student debt and a challenging job market can make it difficult for young people to survive on their own. Pew Research found that 18% of adults aged 25 to 34 lived in the parental home by 2023, with young men more likely to do so than young women.
While this arrangement can help you create more memories with your older children, you should still keep your financial goals in mind, such as paying off debt and planning for your retirement.
How it can affect your retirement
Having an older child at home will lead to some higher costs. Groceries, utilities, insurance, transportation and phone plans can be very expensive. If your older child is not working, you may have to feed even more, which can reduce your nest egg.
All of these extra costs can lead parents to reduce their 401(k) and individual retirement account (IRA) contributions and tap into their emergency savings. Parents without those resources may also need to take on credit card debt, which can delay retirement in the process.
A 2025 study from Thrivent found that 38% of parents with older children at home say their long-term financial goals, including retirement, have been affected by an older child living at home. The study also found that 60% of older children say that their parents do not discuss financial implications with them.
How to set boundaries without damaging the relationship
Having a plan for how much money an older child will contribute to the household can help — and it’s even better if you write it down. (This can help establish non-money related rules as well, such as chores, privacy and visitors). This clarity can prevent any disputes that may arise from both parties not understanding how to approach the arrangement.
Parents should estimate their monthly expenses now instead of being caught suddenly. Having your older child donate regularly – and run errands if they’re not currently employed – can give you extra cash to cover other expenses. It can also serve as a good bridge for young adults looking for full-time jobs.
Although parents can charge rent to their older children, they do not have to put them on the rental market. A modest donation may be enough to cover additional expenses and ensure that the older child can save for their financial future. If your child has doubts about getting their own place, you might ask them to co-sign the loan or rent with them. Just remember that if you do that, you are on the hook legally and financially.
