Boomerang – College Grads Returning Home

It’s that time of year when college seniors walk across the stage, throw their caps in the air, pack their stuff and move… back home. Sounds like four years, $50,000 spent with $27,000 still owed in student loans was well worth it. After all, for four years there was a false sense of semi-independence. Now, not so much. What does it mean when you (or your child) moves back home after college graduation? Was it a failure? A waste of time? A result of poor decisions? Or just life in 2015?

If you are moving back home or if it is your child moving back home they are in good company. I suppose there is strength in numbers because this is a common occurrence. As many as 65% of graduates are moving back home right away and about 45% of college grads 18-24 still live at home. Embrace the reality, then do what you can to make is as pain free as possible.

For parents, the thing that may surprise them the most is that their child is now an adult. Their “baby” that they dropped off at college four or five years ago is now all grown up. They have been living as an independent adult with very little structure and even fewer rules and hanging around with others in the same situation. Many parents expect their kid to pick up where they left off with a strict curfew, being around for dinner, participating in family activities, etc. Parents have to see that their child is on the opposite end of the spectrum. They have to make clear if their child is a kid, a guest, a renter, etc. Making these expectations clear can go a long way in understanding between both parents and child.

Parents should have an open and honest discussion with their adult child along (after discussing it with their spouse of course). See, we are back to communication again. Here is the key: Everything needs to be put in writing. I know it seems weird to make a contract with your own child, but he or she is an adult now.  In fact, it is less stressful for everyone when the rules are clear. It is only fair to make clear what their household responsibilities are, if they are responsible for rent and how much, how long they have until they need to move out and so forth. You don’t want to make it overly uncomfortable for your child, but you also don’t want to provide a maid and cleaning service either. They need an incentive to move out and do so quickly.

It is also a good idea to charge rent, especially if they are working… even if it is part-time. You don’t have to spend the money, you can keep it in an account and give the money back to them when they move out… but don’t tell them you are going to do that. The point is to make them have ‘skin in the game’ and help them learn the responsibility of regular monthly payments. Make it clear when the payment is due and the consequences (additional fees) if the rent is late. You can even set the rent payment to gradually increase as an incentive for them to eventually move out on their own.

For students, the reason they are moving back home makes a big difference. If they are unemployed then it is important for them to NOT behave like they are on summer break. Summer breaks ended when they graduated (unless they become a college professor). They should be spending a lot of time seeking employment and helping around the house as much as possible.

If the student does have a job then they need to be putting money back for a deposit on their apartment, possibly contributing rent to their parents, and have a specific plan in place for what month they will be moving out.

Either way, the returning graduate needs to understand they are cramping their parents’ style, especially if the parents were empty nesters. Suddenly this adult has moved in with them with their own opinions and late night schedule, etc. This is an inconvenience on their parents and they need to show appreciation for their parents’ kindness in allowing them into THEIR home.

One of the reasons recent graduates do not move out once they are in is because 70% say they are happy with their family lives! Time Magazine says most students are in no hurry to leave their parents’ warm, comfortable nest. (For a good movie on the topic watch ‘Failure to Launch’ with Matthew McConaughey and Sarah Jessica Parker). So if they overstay their welcome, parents need to give them an incentive to move out even if they have to subsidize their rent, food, or car insurance. But be sure to slowly wean them off that assistance over several months. I’m not saying push them out of the nest the way birds do and hope they fly, but I am saying you shouldn’t add a room over the garage complete with cleaning and food service either.

Download Our Free Report

The Top 10 Tips to Improve Your Credit Score

We will never give away, trade or sell your email address. You can unsubscribe at any time.


The three authors, Bill Pratt, Mark C. Weitzel, and Len Rhodes, are industry leaders in personal financial education. Together, they have a combined 75 years of experience in banking, economics, and entrepreneurship. Now, they teach thousands of students personal finance concepts and decision making skills, author textbooks and public press books on personal finance, and help schools develop innovative personal finance literacy programs. Recently, they were instrumental in developing a personal financial management certification program for leaders in higher education. The other books in The Money Professor series include The Graduate’s Guide to Life and Money and Extra Credit: The 7 Things Every College Student Needs to Know about Credit, Debt & Ca$h. Their books, lectures, and programs give students, parents, and educators the tools and knowledge to make good financial decisions all their lives.