VOL. 133 | NO. 158 | Friday, August 10, 2018
Rays of Wisdom
Dana and Ray Brandon
Multi-generational Living on the Rise
Ray’s Take: Almost 20 percent of Americans today live in households with multiple generations. According to a recent report from the Pew Research Center, 64 million people reside in a property with two or more adult generations.
This trend started picking up steam during the 2007-2009 recession when high unemployment rates forced many adult children back home with their parents. In addition, many seniors aren’t able to afford the high cost of retirement homes or assisted living facilities, making it more affordable to move in with a family member.
When contemplating adding a family member to your household, consider these financial tips.
First, have regular family meetings. Living in a multi-generational household means sharing many responsibilities, not just financial. Make a list of regular jobs and expenses such as the mortgage and utilities and clearly agree on who will do and pay for what and how much. Continue these meetings at least once a month as a family pulse check. Frustrations can build if there’s not a regular schedule for “venting”. Budgeting tools like Mint.com or Quicken can also help you analyze costs to make sure bills are equitably allocated.
If you have a family member having financial difficulties and can’t afford to pay much toward rent or utilities, assign them tasks or services to help out with the household in lieu of cash. This could be mowing the grass, helping kids with homework, washing dishes, cleaning the house, driving carpool, etc.
Another important financial tip when sharing a household with multi-generations is to not delay saving for your own retirement trying to pay for other family members. Saving for your retirement needs to always remain a priority, even when it may feel that your money should be spent elsewhere. Remember, the best gift you will ever give your family is maintaining your own financial independence.
Lastly, multi-generational living can be a great strategy for easing financial strains on everyone. By combining resources and working together, everyone can build savings.
Dana’s Take: I love the image of a three-generation family in a New York brownstone. The reality is more challenging. The problem with taking in either an aging parent or a young adult, or both, can be summed up with, “You’re not the boss of me!”
Roles get confused. The host loses privacy, space, and independence. The aging parent loses privacy, independence, and, often, a house. The young adult loses privacy and feels like a kid again. Creating a kitchenette in the guest’s room can create an apartment feeling. A mini-fridge, plus a small table with a microwave on top, should do the trick. A private bath also helps, when feasible.
Create alone time and space when possible to balance the togetherness. Best of all, find the silver lining in your time together and make some memories.
Ray Brandon, CEO of Brandon Financial Planning, and his wife, Dana, a licensed clinical social worker, can be reached at brandonplanning.com.