Life after college isn't exactly what Elizabeth McCown thought it would be.
After graduating in August, she moved back into her mother and stepfather's Longwood, Florida, home. While she initially planned to study for the LSAT, the law school entrance exam, she opted to find work instead.
"It is not the time to spend a couple hundred thousand dollars on another degree, not knowing what is going to happen in the future," McCown said.
"Being able to financially support myself, that is really important with everything going on."
McCown, 22, now works out of her bedroom for the same payroll company where her mother, Suzanne Ceballos, 52, is employed.
For Ceballos, the new arrangement makes her happy. She gets to spend time with McCown, while her daughter is able to save money for her future. McCown is contributing to her 401(k) and is also trying to save 30% of her paycheck, after paying for her car and other expenses.
"I haven't asked her to really contribute to the family expenses," Ceballos said. "It's really not costing me very much extra to have her in the house."
Instead McCown is contributing in other ways, including driving her younger brothers around and doing errands for the household.
Their situation is similar for many other families across the country. Young adult children are living at home with their parents in record numbers.
In July, 52% of young adults lived with one or both of their parents, according to a recent Pew Research Center analysis. That's up from 47% in February and higher than the peak reached during the Great Depression, Pew found.
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Parents are also helping their adult children with expenses, whether or not the kids are living at home, a September survey from Country Financial found. In fact, 50% said they help pay everyday expenses, such as cell phone bills, gas or groceries, 21% are assisting with health-care costs and 11% are helping to cover their kid's rent or mortgage.
It's no surprise that parents want to aid their kids, but they should be careful not to sacrifice their own future, said certified financial planner Lawrence Sprung, president of Mitlin Financial, based in Hauppauge, New York.
They should also think of the impact on their children.
"I understand you want to be a parent and do the helpful thing," he said, "but at the same time that help may be actually hurting them and hurting their discipline going forward.
You have to balance those two and it is not an easy thing to do."
Here is what families can try to ensure the financial stability of everyone involved.
Make a plan
If you are a parent and your adult child out of work and living at home, come up with a game plan together that lays out what the options are if the child doesn't find employment in a certain period of time.
"Hold them accountable to make sure they are making progress," Sprung said.
That may mean giving them some time to find a certain job, and if that doesn't pan out, then finding other ways to bring in money.
Also talk about how long they may be living at home or how long you will be willing to help them financially. By being specific, they won't get a false sense that the help is unlimited.
"We've seen too many situations where once people let the kids tap into that well, it becomes a spout that is uncontrollable and you can't turn it off," Sprung said.
"A lot of it comes down to the fact that parameters weren't laid out properly from the beginning."
Kids take on responsibility
If the adult children have an income, they should contribute to the household expenses.
"We don't want to give our kids a hard time. We don't want them to struggle," Sprung said.
"However, if there is no contribution by them, what is going to be their motivation to change the situation?"
If they can't contribute financially, they can find other ways to pitch in. It can be cleaning the house, cooking or other chores that help ease the burden on other family members.
"You want to instill that sense of responsibility," said Troy Frerichs, vice president of investment services at Country Financial, based in Bloomington, Illinois.
Craft a budget
Both parents and children need to come up with a budget or re-evaluate the current one in place.
"You have to control what you can — how much coming in and how much going out," Frerichs said.
When parents help support their kids, they need to account for the increased expenses.
If you start spending more than you are bringing in, you have to make some tough decisions.
"You really have to start asking whether going into debt to fund the situation is the appropriate thing, '" Frerichs said. "Or are you looking at cutting some household expenses across the board?"
Don't forget about retirement savings
Children, if working, and parents should both be contributing towards their retirement plans.
For the adult kids, Sprung advises contributing a minimum of what the company matches up to a maximum of 10% — and working the expenses out around the remaining 90%.
Parents also have to make sure that they aren't hurting their retirement savings to support their children. If they are, they'll have to make a decision about whether they are willing to delay retirement.
"They are really going to have to revisit their own financial plan and see how this is going to affect their goals and objectives," Sprung said.
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