I don’t know about you, but I didn’t go to university (it was free then, too!), so it was quite a steep learning curve when Sam, and then Charlie, went off to uni. There’s so much to think about, from accommodation to finances, but one of the things we never really considered was what would happen when they came home again after graduating. I’ve heard of parents turning the spare room into a gym as soon as their offspring were out the door, but we’ve always made it really clear to our kids that this is their home forever. The thing is, though, it’s an expensive old business, in fact, new research from Skipton Building Society has found that 2.7 million parents in the UK are supporting their grown-up children into later life. But what does this mean for your own finances? Can you help out your kids while still saving for yourself and planning for your own future? And how do you readjust as a household full of adults? Skipton asked me for my managing your finances when your kids bounce back from uni, so here are my top tips:
1 Celebrate their achievement!
First things first, you need to celebrate their achievements and see their return home as a positive. So many times, returning home is seen as some sort of failure, but in this financial climate, it’s something that a lot of young people are going to have to do, so there’s really no stigma attached.
2 Acknowledge this may be a difficult time
Whether they’re job hunting or starting their first job, your boomerang kid is probably already going to be saddled with quite a large amount of debt, whether that be student loans, overdraft or even money owed to you. They might not even have particularly wanted to move back home, so be empathetic to their situation and acknowledge how they’re feeling. Remember, it’s also a bit of a transition period for you too. After being a couple for so long, having them home takes a bit of getting used to (the general noise level, having their mates back around, the extra washing and ironing, etc.).
3 Talk, talk and talk some more
Being completely open (and non-judgmental) about money suits everyone best. If the kids are worried about money, it’s easiest to get everything written down and chat about a plan for managing the debt. With Sam, we found that sitting down and chatting about everything he was worried about (getting a job, the end of his 0% student overdraft, etc) made it easier to reassure him that it was all manageable, and it suited us to attack it together and come up with a workable plan to pay off his most pressing debts, and also sort out a savings account for him to start putting money away for the future.
4 Agree a rent figure that suits everyone
Talking about money can be boring but chatting openly is a great way to work out how you can come to a solution that suits everyone. Obviously with them moving back in, the bills are going to go up (Skipton found that the average boomerang kid increases household outgoings by an average of £86 a month, or £1,032 a year), so it makes sense that they contribute to the household purse.
It’s easy to fall into the trap of loving having them back and not asking them for money, but if you’ve already had a chat about finances, it makes it easier to come to a rent figure that suits everyone. Plus, paying rent is good practice for managing bills when they finally move out into their own place.
5 Help with other things
Another mouth to feed (especially one with a midnight frozen pizza addiction) is always going to add to the food bill so another way of asking them to contribute could be getting them to help out with the food bills, or even to shop for and cook a specific meal at home once a week, a great time for everyone to get together.
I think we often forget that it’s not a one way street – it’s brilliant for us having the kids home, whether that’s being here to look after the house and dog while I’m travelling for work, or being here to pick me up from the station if I’ve been in London for meetings. It’s a two way street.
6 Sneaky savings
If you’re in a great financial situation and really don’t feel like you need the money, another way to look at it is that’s it’s a great way to save money for your kids. If you’ve agreed a rent figure, you could always save the money in a savings account for them. This could be a great way to help them save to pay off their student overdraft, or even save for their first house deposit.
7 Don’t feel bad for asking
After 18 years of providing for their every need, we all fall into the trap of feeling like we need to parent our kids forever, but honestly, having talked to my kids, it’s the last thing they want. Now you’re all adults, they understand that you have your own finances to think about (oh hey, retirement, you’re coming up very fast there in the distance) and that it’s unrealistic for you to provide everything for them. Have an honest conversation about what’s possible, and don’t forget to actively plan to ensure you’re saving for yourselves at the same time.
8 See if you can help in other ways
If they’re off to job interviews or starting a new job, they might initially need help getting around, or if they’re lucky enough to already have a car, help with car insurance or tax.
9 Don’t ignore your own finances
Don’t forget, as well as being a completely new situation for them, having adults instead of children is a big step for you. It’s a great time to have a look at your own finances, and take stock of your savings, pensions, mortgage and plans for retirement. Many parents choose to downsize if some of their kids have left home, or maybe, like us, are considering a move to somewhere cheaper now we don’t have to worry about being in the specific school catchment area. Take the opportunity to delve into your own money as you’re helping your boomerang kids with theirs.
10 And finally… look at the positives
Congratulations, you’ve created a fully functioning, responsible adult! Plus, you’ve still got them all to yourselves for the time being, so enjoy spending time with your boomerang kids, without all the associated worry that you used to have about exams and agreeing times for them coming home. We love having our kids at home and feel it’s a privilege to enjoy them a little longer before they head into the big wide world!
For more information and advice about managing your finances when your kids bounce back from uni, why not visit Skipton Building Society here.