Forty-one percent of parents are currently allowing their adult children to live with them ( that ’ s up just a tick from 40 %

in 2022 ). But 39 % of parents are also reporting that this year they had to either completely withdraw or scale back their financial support , according to the firm ’ s second annual “ Boomerang Kids Survey .”

This makes the next statistic even more surprising , according to one advisor familiar with the survey : There ’ s been a seven percentage point increase in the number of parents who admit they are not actively setting boundaries for the support they ’ re giving ( 60 % said that this year while 53 % said so in 2022 ). More specifically , that means 60 % of the parents are not having conversations with their child about expectations ,

Fifty-one percent of parents have put off their own savings in order to help financially support their children , the survey found .

money management or the establishment of a time line for when the kids will move out or consult with a financial advisor .

“ There ’ s a fair amount of avoidance ,” says Alex Gonzalez , a certified financial planner and Thrivent advisor based in Bloomington , Minn . “ This study is a cross-section of all of our society , and a lot of households don ’ t work with a financial advisor . The ones that do are having conversations with their advisor about where they stand in short- and long-term goals , and this allows the advisor to also have a candid discussion about the impact of supporting an adult child .”

Given that parents are also trying to prepare financially for their own life goals — 48 % of the survey respondents said they were saving for retirement , 25 % were saving to buy a home , 56 % were paying off debt , 24 % were caring for aging parents , and 15 % were saving for college for other children — understanding that impact may be what ’ s needed to move the needle on those heart-to-hearts .

“ Ask the client , ‘ Are you willing to work longer or spend less in retirement ?’ We love our kids and want to help as much as we can , but putting it in context with their financial plan is what we have to do ,” Gonzalez says .

Fifty-one percent of parents have put off their own savings in order to help financially support their children , the survey found . That means they ’ ve had to compromise on their own future healthcare needs . Yet despite that strain , 75 % of parents with boomerang kids aren ’ t discussing money management at all , 80 % aren ’ t setting financial expectations , and 92 % haven ’ t set a time line for their kids to move out .

And those expectations from parents need to be brought out into the open , because right now parents and kids aren ’ t on the same page : While only 16 % of parents said they could fully support their children , 53 % of adult children thought they could .

“ I get it , I ’ m one of these parents myself ,” says Gonzalez , who has three adult children . “ Two have boomeranged back , so my wife and I have had to set their expectations from the beginning . We want to stay on our financial goals and not expose ourselves to more financial risk .”

He says his children are employed , invest in 401 ( k ) s and pay for health insurance . They ’ re also paying off their own cars , paying car insurance and phone bills , and contributing to the household groceries and utilities .

His approach is in keeping with the survey results , which showed that 52 % of parents with boomerang kids want their adult child to help pay for groceries ; 32 % want partial rent or mortgage payments ; and 31 % expect help with water , gas and utilities .

He says he ’ s not charging his own kids rent , and that means “ they can save that and build up some cash so they have the flexibility ,” he says . “ This is teaching them some good money lessons long term — they ’ ve already set up flexible spending accounts at work . But the real lesson is life is expensive .”

— Jennifer Lea Reed

10 | FINANCIAL ADVISOR MAGAZINE | JULY / AUGUST 2023 WWW . FA-MAG . COM