Home Improvement

 Thanks partly to the COVID-19 pandemic and persistent inflation, boomerang kids are back (again).

Of course, you welcome your children back home until they get back on their feet—but to what extent do you foot the bill? In some cases, it might help to practice a little tough love from the get-go to prevent your adult child from getting too comfortable.

“We love our children dearly, but we’re in charge of teaching them how to make their own way in this world,” says Dj Olhausen, a real estate agent in San Diego. “The idea behind charging rent is to allow them to grow.”

So how do you make the transition from parent and child to landlord and tenant? Here’s how to strike the perfect balance.

Start with an open dialogue

Okay, your “baby” is moving home and turning your meditation room back into their bedroom. But before any moving boxes arrive at your house, establish ground rules for living together.

And No. 1 on that list should be whether your child will pay you rent. For some, that choice is easy.

“The advice we would give parents dealing with boomerang kids is to charge rent,” says Janice Shokrian, CEO and founder of Tausi Brands in Lake Oswego, OR. She also encourages discussing conflict resolution tactics upfront and making sure to build in family time.

Shokrian did all this and had a positive experience when her adult child and their partner moved in for two and a half years. And according to Shorkain, the experience worked out so well, she would “welcome them back in a heartbeat.”

Consider your child’s current income

Consider your child’s financial situation when deciding how much to charge them in rent. Overcharging your child can strain your relationship and make it harder for them to save up for their own place.

To determine a fair number, Rany Burstein, CEO and founder of Diggz.com, notes that most financial advisors recommend spending no more than 30% of your income on rent. He suggests adding a “friends and family” discount on top of that.

So talk to your child and see what 15% to 20% of their income would look like as rent. You’re good to go if you’re both comfortable with the number.

Shokrian, who had two people move in (her child and their partner), charged the couple half the amount of their previous apartment rental, which worked out to be $600 a month.

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Be clear about utilities and groceries

If your child is moving back in due to financial hardship, charging a monthly rental fee might not be possible. But there are other ways to ensure your child contributes to the household.

After all, your monthly mortgage payments won’t increase when your child moves home. But your gas, electric, and grocery bills certainly will.

“Your child is an adult and should be contributing to household expenses,” says Jeff Hunt, the co-founder of Kid Travel, a blog for families. “However, it’s important to communicate these charges clearly and fairly.”

For guidance, gather your bills, add them up, and divide them by how many people live in your home. For example, if you have four people (including your newly returned child) under your roof, consider charging your kid for one-fourth of the total expenses.

Think of creative ways your child can contribute

Not entirely comfortable charging a monthly anything? We hear you.

If that’s the case, you can substitute cash with alternate ways your kid can contribute around the house.

“This could be assuming all the responsibilities for grocery shopping, maintenance, walking the dog, or making any upgrades to the residence,” Burstein says. (Do not underestimate the power of the young to help you get a handle on all things tech.)

Adjusting rent or foregoing rent entirely in exchange for household chores is also an excellent way for your child to cultivate healthy financial habits.

“It demonstrates how household finances work and the importance of contributing,” says Daniel Anderson, founder and editor at The Money Maniac.

Help them save for their own place

When your adult child moves back in, you can also (gently) offer some financial guidance to help them get back on their feet—and out of the nest.

“Parents can help their adult children create a budget and help them stick to it,” says Samantha Zhou, manager of health and mental wellbeing at Freedom Dividend. “Second, parents can encourage the child to save as much money as possible.”

Some parents might even be financially secure enough to put the rent they collect into an account and later return the money to their child.