What rent should ‘boomerang’ kids pay?

The Tribune (NZ) - - YOUR HEALTH - ROB STOCK rob.stock@fair­fax­me­dia.co.nz

Turn­ing the kids into a cash cow to boost your su­per sav­ings may have un­in­tended con­se­quences for you later on.

Charg­ing your boomerang child rent is an emo­tive sub­ject. We live in an age of stupidly high rents and stupidly high house prices in some cities thanks to our self-cre­ated hous­ing cri­sis.

It’s no won­der many grown-up chil­dren re­turn to their fam­ily homes af­ter study, at least for a few years.

That raises the ques­tion of how they should con­trib­ute to the house­hold’s fi­nances.

Ask­ing whether par­ents should charge mar­ket rent to a boomerang child brings a hearty ‘‘Heck, yes!’’ from folk who see the young as feck­less and in need of a dose of the real world.

‘‘That’ll wake them up to cold, hard facts and end their sense that the world owes them a liv­ing,’’ they cry.

I’ve never been able to take joy in the idea of peo­ple charg­ing their kids for the right to oc­cupy their old bed­room.

Some­times it is an eco­nomic ne­ces­sity. If money is tight in a

home, then earn­ing chil­dren need to con­trib­ute for their room and board.

Even if money is not tight, it’s rea­son­able for an earn­ing adult oc­cu­pant of a home to pay their share of the food, power and wa­ter bills, and if the par­ents are renters, a por­tion of the rent.

I’d sup­port par­ents who de­cided to charge board be­cause they gen­uinely felt their boomerang child was tak­ing the mickey by liv­ing gratis at home while spend­ing money freely on a party life­style.

But I don’t think many boomerang kids do come back to freeload.

I think they of­ten come back be­cause the world is harder than they can cur­rently cope with, or be­cause they have a wealth en­hance­ment plan such as to save to­wards a house de­posit, or to pay off debt.

Viewed in this light, par­ents are able to use their home to help their chil­dren lay a foun­da­tion for a bet­ter fi­nan­cial fu­ture. That is a great use of a house, es­pe­cially if the par­ents had no in­ten­tion of ever rent­ing a room out to a boarder.

I even know of a case where rent and board was charged, squir­relled away sur­rep­ti­tiously, and then given back later to­wards a house de­posit. While chip­ping in for house­hold costs shouldn’t be emo­tion­ally fraught, charg­ing mar­ket rent for a room sends odd sig­nals to your chil­dren.

It en­cour­ages them to leave and pay that money to a stranger. That’s hardly a vic­tory for fam­ily fi­nances.

It also sends a pow­er­ful mes­sage about in­ter­gen­er­a­tional de­pen­dency.

When we are young, we de­pend on our par­ents. When we are old we de­pend on our chil­dren.

Turn­ing the kids into a cash cow to boost your su­per sav­ings may have un­in­tended con­se­quences for you later on.

Fam­ily cir­cum­stances will de­ter­mine what kind of board, if any, par­ents charge their boomerang kids, though in all cases, the blighters should ex­pect to do their share of chores as well.

PHOTO: 123RF

Ask­ing younger earn­ers in the house­hold to chip in to­wards its run­ning costs is not an easy con­ver­sa­tion to have.

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