If you’re a recent college graduate or a 20-something living in the U.S., there is a 50/50 chance you are not enjoying the comforts of your own digs. Simply meaning, you’re probably stuck enjoying the comforts of your parent’s home instead. Basking in the warmth of your childhood home may be ideal for some, but for most it’s a financially motivated move powered by the weak job market and economy.
According to the Kansas City Star, many young adults under the age of 24 have been influenced by the Great Recession that struck while they were still in school and have decided to move back home rather than move into their own place. Many of them have college loans to pay off, are still searching for a job or want to be smart and save a good amount of money before they decide to go off on their own. It may be a smart move, but a lot of young adults are not particularly excited about moving back home with their parents. “I miss my independence,” said Teresa Shum, a recent graduate from the University of Florida. Happiness aside, Shum stated in the Star that she is able to save $1,000 a month – money that she can put towards her own place when she is ready to move out. “It makes more sense to save money before moving out.”
According to the U.S. Census Bureau, the number of 20 to 29-year-olds that live with their parents has increased to 30 percent in 20011 from 27 percent in 2007. With that data, almost half of 20 to 24-year-olds live at home with their parents. Some of those young adults already have a steady job and are already preparing their finances for retirement. The Star highlights 22-year-old Alex Seaman who works as a firefighter-paramedic and is living at home with his parents specifically to save up for his own home. “I’m fortunate to have a career and can save some money,” Seaman said in the Star. Since he is able to live with his parents, he thinks he will be able to save up the money he needs for his house in a year or two as opposed to maybe four or five if he was living alone and paying for rent.
Some economists believe that young adults living at home are hurting the economy because they are not spending money on goods needed to build a new household, like furniture. On the contrary though, economist Salazar-Carrillo says that they instead choosing to spend their money elsewhere, mostly in entertainment. “Those 26 and under have their own ideas of consumption,” he said. “That includes a car, some weekend splurge money, as much as $200 a weekend.”
But moving home doesn’t exactly mean they’re living for free. As the Star highlights, Bryan Sharkey, a 2009 Princeton graduate who works for an investment bank in Miami, does household chores as well as pays $500 a month to his parents for room and board at their Pinecrest, Fla., home. Others may not pay their parents for living in their house, but are an extra helping hand. Estee Pinzon, a 2010 Loyola University graduate makes family dinners and does other household chores. “I want to help,” she said. Moving back home may be hard for some and the loss of independence may send some searching for a cheap apartment, but in the end it seems to many young adults that living back home is a smart investment and a secure move considering the current state of the job market and economy.
SOURCE: The Kansas City Star
IMAGE: Courtesy of the Houston Chronicle