How to Handle a Suddenly Full Nest (Again)

By Carla Fried

An increasingly popular coping mechanism for recent college graduates who are finding it excruciatingly difficult to launch their careers when jobs are so scarce-and college loans are so large- is to move back home. That’s what family is for. But at the same time, parents are wise to set ground rules on how the once again full-nest will run. Your child will always be a child, but they are also an adult now. Setting some financial ground rules isn’t punishment. It’s instilling a sense of adult responsibility. And let’s be honest, that’s going to make the time together run a lot more smoothly for you as well.

Some tips to help your family live happily ever after (again) under one roof:

1. Insist on Rent. Doesn’t matter if you need the help or not. This is about conveying to your child that you do not see them as a 10 year old, but as an adult 22-year-old. While they are looking for a full-time career job they can also find some part-time work to contribute to the family.
2. Save The Rent for Their First Deposit. If you’re still squirming at the idea of charging rent, how about tucking away that money into a separate savings account. Then when your child lands a job you can spring it on him or her that you saved every penny they paid you. That should be a huge help with the deposit when they are ready to move into their own rental.
3. Make Sure They are on Top of their Student Loans. There is a six-month grace period between graduation and when the first payment is due on student loans. That means November or December is when most grads must begin repaying their loans. Simply ignoring this fact will only make matters worse. Much worse. As in penalties and fees, and a huge ding on their credit report. And a credit report ding is the last thing they want to self-inflict. Many employers now request permission to check a job applicant’s credit report. Your child can’t afford to have any red flags show up. And make sure your child understands that even if they do not have a job they still must contact their lender and make a formal request for deferment. The federal loan program is set up to allow deferment for the unemployed, but only if borrowers apply for deferment. Otherwise you are considered to be in default. Private loan lenders have no obligation to offer deferment, but that doesn’t mean they won’t agree to a delay. Again, the important step is to be proactive and ask for the deferment before the loan is in default.
4. Insist on Health Insurance. If you have a health plan through work, you can re-enroll your child on your plan. A provision of the 2010 health care reform legislation allows adult children to piggyback on a parent’s insurance until the age of 26. (And again, don’t be shy about having your child pay at least part of the premium cost.) Or insist that your child obtain a short-term insurance plan on their own. Yes, the odds are thankfully low that a healthy young adult will need costly medical care. But low does not mean zero. Your family cannot afford that risk. Send your kid over to ehealthinsurance to shop for short-term insurance. If you need to suspend or scale back rent payments so your child can cover this expense that’s a solid parental assist.