More than two years after moving in with their parents, many millennials and Gen Zers have yet to leave, according to a new report. Those still in the coop use their time to pay down debt and save for homeownership.
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In the early days of the pandemic, many parents saw their chicks come back to the coop as rapidly rising rents, layoffs and other economic stressors made it impossible to maintain nests of their own.
However, two-and-a-half years later, two-thirds of those chicks still struggle to spread their wings, according to LendingTree’s latest report published on Tuesday.
Using survey results from 1,300 U.S. parents and their children and U.S. Census Bureau data, LendingTree found that 32 percent of millennials — people born between 1981 and 1996 — and Generation Z (Gen Zers) — people born between 1997 and 2012 — have moved back home during the pandemic and two-thirds of them are still cozying up with their parents.
The report shows Gen Zers most likely to boomerang back home (30 percent), and those who’ve had an easier time transitioning back to their own digs (14 percent). Meanwhile, younger (18 percent) and older millennials (17 percent) have been less likely to move back home, but have had a harder time transitioning back to independent living (13 percent and 8 percent, respectively).
Although boomerang kids — a decade-old term coined by the Pew Center for adult children who move back home — get a bad rep, LendingTree said millennials and Gen Zers have used the extra dollars in their budgets to reduce their student loans and consumer debt (39 percent) and save for down payments (31 percent).
Another 23 percent padded their retirement savings, 16 percent were able to accept a lower-paying job they loved and 10 percent saved for a life event, such as a wedding. Only 15 percent of respondents said moving back home didn’t make a difference in meeting their financial goals.
So, what about the parents?
LendingTree said 56 percent of U.S. parents are open to having their children move back home, with parents aged 57 to 76 most likely to have already welcomed their adult children back home (45 percent). Hawaii (21.6 percent), New Jersey (20.7 percent) and Florida (20.1 percent) have the greatest share of multigenerational households, which LendingTree credited to higher costs of living and some children moving back in to care for aging parents.
North Dakota (5.3 percent), Nebraska (8.0 percent) and South Dakota (8.3 percent) had the lowest percentage of adult children living with parents, thanks to rock-bottom unemployment rates and an affordable cost of living.
Nearly half of parents and children said living together again has improved their relationship (49 percent), with children helping with cooking and cleaning (58 percent), contributing to food and utilities (56 percent) or paying rent (27 percent). Only 10 percent of parents said they had no rules at all.
Current economic factors, primarily inflation, will continue to impact young adults’ decisions to move back home and whether they make the jump into homeownership, LendingTree Senior Economist Jacob Channel said.
“With inflation as high as it is and with rates rising, it can be difficult for anyone to make ends meet in today’s economy,” he said. “[However], if you’ve got enough money to afford to buy a house and pay for a mortgage each month, now can be a good time to buy a home, even if prices and rates are high.”