A recent survey by Thrivent reveals that nearly half of parents with adult children aged 18 to 35 report their children have returned home, a phenomenon known as “boomeranging.” According to the survey, nearly half of adult children (46%) received a perfect score on their budgeting abilities. In comparison, 63% of those who never returned to live in their parents’ house did far better in this respect. This disparity begs the question—does living at home affect the level of financial literacy?
Accountant and certified financial planner Alex Gonzalez at Thrivent believes open discussions about money are critical. He wants to inspire parents to have productive, respectful conversations with their adult kids about money. To prepare his kids to succeed financially, he’s tapped a number of different approaches. This advocacy and mobilization effort proved even more pivotal once they returned home during the Covid-19 pandemic.
To Gonzalez, the most important thing is to have a good financial plan in place. He shares with his children the value of having a good plan of action. This trauma-informed approach promotes their independence, allowing them to find and maintain their own housing and build their own futures.
To facilitate this learning process, Gonzalez required his children to research local rental costs and set aside a comparable amount in a savings account each month. He argued with them for them to pay their share of living costs. To counter those doubts, he focuses on the bright side of leaving home. By adopting this approach, it reinforces a sense of accountability and structure as they begin their transition.
“Every family has their own culture and approach to talking about money,” Gonzalez stated. That’s good, because he’s concerned some parents would be unwilling to discuss money matters. This is particularly the case when their adult children are boomeranging home. This fear or avoidance makes it even more difficult for young adults to take control of their financial futures.
For Gonzalez, the most important part is communication. Rote financial skills cannot be mastered in a vacuum. If adult children enter their lives without having these important conversations, they’ll be ill-equipped with their financial acumen and will receive failing grades. He writes that one of the biggest difficulties families have had to deal with in this period has been twofold. These impediments can undermine the developing financial knowledge and skills of boomerang children.
Gonzalez’s approach is a perfect example of how proactive conversations about finances can better prepare our young adults with the tools they need to succeed in the future. By guiding his children with love and high expectations, he wants to create a home that eventually allows them to soar on their own.