The “Boomerang Generation” is a subset of Millenials who have either returned home following college, or are still living at home well into their 20’s and 30’s.  According to a recent study by Pew Research, about 3 in 10 young adults ages 25-34 are living at home with mom and dad.  A weak economy is to blame for some of this to be sure.  However, many of these young adults are coming home because they realize they can’t afford to live the lifestyle they had while at home, and they want it back.

Baby boomers are obviously the ones supporting these young adults, and it’s happening right at a time when they need to be stashing away as much cash as possible for their retirement.  Currently about 1/3 of all baby boomers are providing financial support to others.  Here’s how it breaks down:

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Baby Boomers are not the only ones providing financial support to others, but they are the largest group that’s getting hit up for money.  Late career would be most of the baby boomers today.  Late career is when you are earning the most you’ve ever made, and it’s when you should be putting away the most towards retirement.  This is hard to do if you’re still supporting adult children who just won’t launch out on their own.

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So what can you do?

If an adult child comes to you and needs help, turning them out into the cold is an option, but not the ONLY option.  Having adult kids at home can cause a lot of tension and stress on you, your spouse, and the child.  If you decide to allow one of these boomerangers to come back home, you need to establish some guidelines with them.  Having a clear understanding up front will save both of you a lot of headache.  Here are some things to discuss:

• What will I pay for?
• What will you pay for?
• How long can they stay?  Set a timeline.
• Help them develop a financial plan.

Remember, the best thing you can give your child may not be money, but rather their independence.  Chance are you had to make your own way in the world, which didn’t come easy or quickly.  Our kids need to do the same thing if they are going to be successful adults.  They need to understand that they are most likely not going to be able to continue to live the lifestyle you have for a while.  You got to where you are through many years of hard work, and they will too.  Providing too much support to a boomeranger can seriously delay your retirement, or derail it all together.  While it’s always good to help those in need, you should not feel guilty saying “no”.