When The Empty Nest Fills Back Up

When The Empty Nest Fills Back Up

The idea of sending the kids off to college, selling the family home and downsizing to a comfortable retirement destination has become harder for those who find their empty nest is not really empty. The Pew Research center noted that 29 percent of young adults ages 25 to 34 are living with parents. Other reports have the number as high as 36 percent.

Sometimes labeled emerging adults or boomerang kids, this trend can be viewed positively or negatively. On the positive side, these young adults are able to start their career without racking up a lot of debt until they get established. On the negative side, this can affect parents’ plans by delaying retirement or adding unplanned extra expenses. For parents who already assisted with the cost of college, this can be especially stressful.

Even if they are not under the same roof in the physical sense, a record number of parents are assisting their adult children financially. A Pew survey of 2,500 adults found that nearly half the people ages 40 to 59 have given money in the past year to at least one child who is 18 or older, with 27 percent providing the primary support. 

It can be a tough decision how much to assist, especially if this comes at the cost of withdrawing from retirement accounts or other long-term investments. Financial implications can range from actual monetary amounts given, to holding off on the decision to downsize or move to a different location.

Reevaluating how much you can really help is a conversation you should have with your financial advisor. Contact your financial advisor today if you have concerns about how unplanned expenses for your adult children could affect your financial security.

FINANCIAL FACTS

Profitable – Aggregate earnings per share of the S&P 500 companies are projected to increase by 18 percent in 2014 over actual earnings from 2013 (source: S&P, BTN Research). 

Do I Believe It? – The official unemployment rate in the U.S. has dropped 1.3 percent from Jan. 31, 2013, to Jan. 31, 2014, its largest year-over-year drop since Nov. 30, 1984 (source: Department of Labor, BTN Research). 

Get Out – U.S. banks repossessed 462,970 homes in 2013, an average of 1,268 homes per day, the lowest annual total in the United States since 2007 (source: RealtyTrac, BTN Research).