`Boomerang kids' keep returning home

Money: Parents are often happy to help their adult children, but financial planners warn of risk.

February 16, 2004|By Eileen Ambrose | Eileen Ambrose,SUN STAFF

Gayle Lomax of Columbia figured she had successfully launched her first child from the nest four years ago when her daughter moved to Washington to attend Howard University.

But six months ago, her daughter was back home, no longer able to afford her apartment on a part-time job and saddled with more than $5,000 in credit card debt. The 22-year-old has finished school and is working as a waitress while searching for a job in television production.

"The prospects aren't really good. She may be home longer than a year or so," said Lomax, a single parent.

Across the country, more and more parents are finding their adult children returning home to live for months or even years when they had been expected to be deep into their own lives. The latest census figures show that 56 percent of men and 43 percent of women ages 18 to 24 live with one or both parents.

These so-called "boomerang kids" are appearing on their parents' doorsteps for reasons that include a lackluster job market, health problems, divorce or the realization that they can't afford the kind of lifestyle their parents offer.

Parents are often happy to help their adult children get on their feet, both financially and emotionally.

But an offspring's return is frequently a financial burden. In serious cases, where adult children repeatedly boomerang home, their parents' lives can be derailed, financial planners say.

"Children are the No. 1 financial risk to parents, far beyond anything that the stock market can do," said John Bacci, a financial planner with Foundation Financial Advisors in Linthicum.

Young adults who come home frequently expect to pick up where they left off -- living rent-free in their old room, with Mom and Dad footing the bills, experts say. Food and utility costs shoot up. Parents might pay health and auto insurance and supply a monthly allowance. Many children arrive deep in debt, and some parents feel obligated to bail them out.

Money shelled out to help adult offspring means fewer dollars going toward the parents' goals, including retirement.

James Klima, a financial planner in Ellicott City, bluntly told a Howard County couple recently that their retirement plan is being jeopardized by their two daughters, both in their 30s and divorced.

The couple want to sell their large house and move to a smaller place on the Eastern Shore. They haven't done so because each daughter has come home two or three times in the past five or so years, Klima said. By continuing to support their daughters this way, the parents risk a lower standard of living in retirement, he said.

"It's an emotional tug of war. Doing what you need to do for your own best interest and giving in to your kids' failings," Klima said.

Lomax said she postponed some discretionary spending, such as travel and replacing an 8-year-old car, when her daughter returned.

"There are some things that I would love to do that will have to wait," she said.

Living rent-free at home has allowed her daughter, Sharon McDonald, to use her paycheck to paying off the credit card debt.

"I kind of miss being on my own," McDonald said. But she added: "It's convenient. Free food. No bills. I'm glad to have my mom close by."

Lomax, a vice president at T. Rowe Price Investment Services, said her generosity has its limits.

"The prospect of her being at home at age 30 would scare me to death," said Lomax, 44, who also has a son in college. "I'm at a point in my life and understand money enough to know that I'm going to do what I need to do to make sure my retirement is taken care of."

Many parents who welcome their adult children home acknowledge that they wouldn't have dreamed of doing the same thing when they were young.

"We were actually in the mind-set that once you get out of the house you're an adult and ... you have to make your own way," said Dalene Robinson, 60, of Ellicott City, who jokingly referred to her two adult children as "revolving-door kids."

"The kids today can't make their own way," said Robinson, whose daughter, Carmon, a single parent, makes about $10 an hour. "That's tough."

A tough job market has prompted some children to return home.

Ricky Harris, 26, has been living with his parents in Denver since he graduated from George Washington University Law School in May.

"It's really tough," Harris said. "I didn't think I would be living at home as long as I had been."

His mother gives him $300 a month for spending. He helps out by running errands, such as grocery shopping, picking up the dry cleaning or taking her dog to the vet.

"It's not bad," said his mother, Susie Johnston. "The only problem is he's kind of messy. I just shut his door."

Some young adults move back home to live rent-free while attending graduate school or building up a down payment on a house. Others return because their parents can provide a higher standard of living than they can afford on their entry level salaries, experts said.

Sometimes it's more than economics.

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