25% of Millennials Live With Their Parents -- but Is That a Bad Thing?

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KEY POINTS

  • An estimated 1 in 8 millennials moved back in with their parents this year.
  • Financial concerns and rising rent costs helped fuel that trend.
  • While living at home can have financial benefits, it can have its drawbacks.

Given current economic conditions, it's easy to see why.

Some parents struggle when their grown children move out of the house and they become empty nesters. But new data from PropertyManagement.com reveals that fewer parents may be grappling with empty nest syndrome these days.

The reason? A growing number of young adults are opting to move back in with their parents.

In fact, this year alone, 1 out of every 8 millennials moved back home. And all told, a good 25% of millennials live with their parents.

Of course, it's easy to see why so many young adults live under their parents' roofs. Living costs have soared over the past 18 months as inflation levels have surged. And therefore, many millennials have moved back home in an attempt to save money and avoid financial struggles.

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Then there's the rising cost of rent to consider. Higher home values and mortgage rates have pushed many would-be buyers out of the real estate market over the past couple of years. And so that drove up demand for rentals, paving the way for landlords to charge higher rent. And why would any young adult want to spend a small fortune on rent where there's a potentially free housing option available?

But while it's easy to see why so many millennials are choosing to live at home, the question is, is that a good thing? To some degree, yet. But there are pitfalls those who move back home might run into.

The upside of moving back home

Living with your parents for a period of time could afford you the opportunity to sock away a lot of money. After all, if you're not paying rent, and your parents aren't asking you to chip in for utilities, you can take the money you would've spent on those items and put it into your savings account instead.

If you're carrying debt, either in the form of a credit card balance or outstanding loan, moving back in with your parents might also allow you to chip away at that debt sooner. Plus, if you're working remotely these days and aren't leaving the house as often, you might appreciate sharing a home with other people who aren't messy roommates.

The downside of moving back home

For some people, moving back home can feel akin to failing at adulthood. This isn't to say that if you move in with your parents, you should feel that way. But you might end up feeling bad about your situation, even though there's no reason to.

What's more, when you share a living space with anyone, there's always the potential to clash. Your parents might have certain opinions about your career, your significant other, and the things you do in your free time. If you're living under their roof, that sort of gives them the right to voice those opinions.

Finally, while moving back home might help you save money, it could also make it harder to build up a credit history. Let's say you graduated college recently and decide to live with your parents for a year or two. If, during that time, you don't have any bills in your name, it could make it difficult to establish a credit history, which you'll need if you want to apply for a credit card, loan, or place to live.

All told, there are pros and cons to living at home. But if the former outweigh the latter, then it could make sense to move in with your parents for a period of time, especially if you're trying to build savings or get on your feet financially. And besides, it's hard to beat the comfort of living in the home you grew up in. So if that's an option, it's easy to see why you might be hard-pressed to give it up.

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