Has the proverbial “empty nest” become a thing of the past? Data suggests this traditional stage of the American household lifecycle is undergoing some dramatic changes.
In the U.S., increasing numbers of late middle-age couples are struggling with different lifestyle adjustments than those seen in the past. For these families, the challenge isn’t about adapting to loneliness as their offspring grow up and leave home. Rather, it’s about coping with a “full nest”: their adult children are still living at home and their elderly parents are moving in, too.
A perfect storm of events has created a new lifestyle dynamic.
The recession that began in 2008 resulted in record unemployment and an increased demand for higher levels of education and experience, creating a myriad of financial challenges for younger adults. At the same time, extraordinary medical advances have made it possible for many seniors to extend their lives, although not always in good health and frequently requiring extensive care or assistance. Those in the middle are known as the ‘sandwich generation’, juggling caring responsibilities for both their older and younger family members at the same time. According to a recent study by researchers at Oregon State University, what was once a life stage filled with freedom and new opportunities has largely disappeared. The end result? Empty nest plans that have to be put on hold, creating a mixed bag of emotions that range from eagerness to help, to frustration and exhaustion.
‘Boomerang kids’ are on the rise.
According to the U.S. Census Bureau, today’s adults between the ages of 18 and 34 are more likely to be living in their parents’ home than they are to be residing with a spouse or partner in their own household. This steady rise in adult children who return to the nest, dubbed ‘boomerang kids’, can be attributed to a combination of socioeconomic factors. Financial hardship is the primary reason for most adult children moving back home. Whether it’s the result of inadequate income levels, student debt, or rising housing costs, millennials are finding it harder to survive on their own. Their income, even if it seems ample, is often no longer sufficient to maintain a home of their own. In many cases, it puts heightened pressure on middle-aged parents to financially assist their grown children. While this situation is especially common in expensive housing markets, it’s become a growing trend nationwide that’s gaining cultural acceptance. These boomerang kids go from living on their own with the independence they’ve become accustomed to, to having to live under their parents’ rules once again. For the parents, plans to downsize or enjoy their newly acquired post-employment freedom must be put on hold. Depending upon the reason that these adult children have returned to the nest, new financial pressures may also come into play. There’s often a period of significant adjustment for everyone involved.
Caring for aging parents creates a different set of challenges.
In the U.S., people aren’t generally socialized to expect to take on an aging parent-caring role, despite the fact that most of us will shoulder this responsibility at some point in our lives. The response to helping elderly parents who require increasing amounts of assistance also comes with a wide range of conflicting emotions, often viewed as both rewarding and taxing. Many middle-aged Americans whose elderly parents live with them say they’re starved for time, physically exhausted, and that making plans is challenging due to health uncertainties and other disruptions. The rising cost of healthcare and prescription medicines is a common financial burden. Still, many people find that having the opportunity to provide for those who raised them brings immense joy and satisfaction.
Planning helps to ‘ease the squeeze’.
When you learn that you thirty-something daughter lost her job and is moving back home, or that your Dad’s declining mobility is forcing some hard decisions about where he should live, it’s time to get planning. Multigenerational family living situations can be successfully managed as long as there are strategies in place to ease the burden. For your boomerang kids, it’s important to determine up front how long they plan to live with you and in what ways they can contribute to the household. Are they able to pay rent, help pay for utilities and/or assist with buying groceries? If they aren’t in a position to make financial contributions, determine how they can help in other ways. Cutting the lawn, preparing meals and performing various household chores can be big benefits to a busy professional. If your aging parents are part of the equation, too, can they realistically cover their own basic needs, such as medical care, prescriptions, and clothing? From there, you can calculate how much additional financial assistance, if any, will be necessary. If your aging parents need aid in the form of help with their daily activities, perhaps your adult children can step in to lend a hand. At the end of the day, the older and younger generations may wind up forming a closer bond than they ever had before.
A new awakening is on the horizon, too.
The dual demands of adult children still transitioning to independence and aging parents who need increasing amounts of care is causing many Americans in their 50s and 60s to re-evaluate their own lives. From making plans for their futures so they don’t pose a burden on their children, to soul searching their desires as they grow older, the sandwich generation is becoming more self-aware. If you’re among this growing population of late middle-aged adults whose nest is far from empty, now is the time to learn more about the unique ways your generation is evolving and how you can successfully meet these new challenges.
FAI’s experienced financial advisors can help you make the most of your resources and safeguard your assets so you can best assist your loved ones, both young and old. Please contact us to learn more.
About FAI Wealth Management, Inc.: Located in Columbia, Maryland, FAI focuses on helping clients create the financial future they desire by protecting their wealth, making the most of their assets, and planning for life's uncertainties. The firm combines fee-only, fiduciary-driven guidance with highly personalized, consultative financial planning and investment services that enable individuals, families, and businesses to navigate complex life transitions. Founded in 1987, FAI currently manages more than $350 million in client assets nationwide. For more information about FAI Wealth Management, please visit the website at https://www.faiwealth.com or call 410.715.9200.