Financial Literacy - Families and Finance
smart spending
6 tips for living with boomerang kids

Prepare for money requests

If you don't need your child's rent money, think about putting some or all of it aside into a savings account. The money can be tapped later if your child asks you for money, or if not, it can be used to defray future wedding expenses.

It's generally not a good idea to lend or give money arbitrarily before you assess your own financial situation.

If your child does ask for money, take the time to plan where this money will come from and how soon you'll need it back, if ever.

“Graduating seniors owe $20,000 in student loan debt on average, according to a study by Ameriprise Financial.”

"It goes back to expectations," Skeels says. "Are these funds meant to be a gift or a loan? Decide which one it's going to be, and let's treat them as that."

If you decide to lend your child money, set up a payment plan and insist that the money be paid back. "If it's not paid back, don't loan in the future, just like a bank wouldn't," says Skeels.

Compel your child to start saving

College graduates often have two things in common: They have bills to pay, and they need money.

If your goal is to nudge your boomerang kid out of the house within a specific time frame, now is a good time to help him or her build wealth.

If your boomerang kid is working, encourage him or her to start saving some income every month and build up cash reserves.

This will help with the short-term goal, which is to help your child become independent and move out.

Getting children to start saving for long-term goals such as retirement may be a little trickier. With homecoming rallies and keg parties still fresh in their minds, children will likely give no reaction other than a glassy-eyed stare when a conversation about retirement is brought up.

Still, it should be part of the living-at-home discussion.

If your child is working and his or her employer provides a 401(k) match, encourage the child to participate in the company plan. Even if there is no match, your child should contribute at least the minimum.

If the employer doesn't offer a retirement plan, persuade your child to save in a Traditional IRA or Roth IRA.

"The real key is for them to get some direction," Skeels says. "A lot of time when they move back in with folks, they don't have that direction."

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