Returning to the family roost

MILWAUKEE — After being laid off from her job as an events planner at an upscale resort, Jo Ann Bauer struggled financially. She worked at several lower-paying jobs, relocated to a new city and even declared bankruptcy.

Then in December, she finally accepted her parents’ invitation to move into their home — at age 52. “I’m back living in the bedroom that I grew up in,” she said.

Taking shelter with parents isn’t uncommon for young people in their 20s, especially when the job market is poor. But now the slumping economy and the credit crunch are forcing some children to do so later in life — even in middle age.

Financial planners report receiving many calls from parents seeking advice about taking in their grown children following divorces and layoffs.

Kim Foss Erickson, a financial planner in Roseville, Calif., north of Sacramento, said she has never seen older children, even those in their 50s, depending so much on their parents as in the last six months.

“This is not like, ‘OK, my son just graduated from college and needs to move back in’ type of thing,” she said. “These are 40- and 50-year-old children of my clients that they’re helping out.”

Parents “jeopardize their financial freedom by continuing to subsidize their children,” said Karin Maloney Stifler, a financial planner in Hudson, Ohio, and a board member of the Financial Planning Association. “We have a hard time saying no as a culture to our children, and they keep asking for more.”

Bauer’s parents won’t take rent money or let her help much with groceries. She’s trying to save several hundred dollars a month for a house while working as a meetings coordinator.

Bauer would prefer to live on her own, but without her parents’ help would “probably be renting again and trying to stick minimal money in the bank,” she said.

Shirley Smith, 80, said she and her husband didn’t hesitate when they invited Bauer to return to their home in Eden, Wis. Buying groceries for another person isn’t stretching her budget too much, she said.

“I’ve got three kids and any of them can come home if they want,” she said.

But plenty of well-meaning parents must delay retirement or scale back their dreams because they have to help their children, Stifler said.

Some of Erickson’s clients are giving as much as $50,000 at a time to their kids, many of whom have overextended themselves with big houses or lavish lifestyles. And the sliding economy might threaten their jobs.

Parents feel guilty if they don’t offer help, but she warns them to be careful with their savings.

“I almost have to act like a financial therapist if you will,” she said. ” ‘Here is the line I’m drawing for you. That’s fine. You can do up to this point, but at this point, now you’re starting to erode your own wealth.’ “

Anna Maggiore, 27, lost her job as a publicist in Los Angeles about three years ago and moved into her parents’ house in Los Alamos, N.M.

She tried to find jobs, but nothing stuck, so she enrolled full-time at the College of Santa Fe to finish her bachelor’s degree in business.

She figures her parents spend about $1,000 a month on her, including a car payment, car and health insurance, school and other costs. Her father is a retired nuclear physicist and her mother, a guidance counselor, will retire this spring. Now Maggiore is looking for work so she can supplement their income.

“It’s kind of hitting me finally that I need to get out there and find a job,” she said. “Even if it’s just part-time just to help out however I can.”

A new survey by the retiree-advocacy group AARP found that one-fourth of Generation Xers, those 28 to 39 years old, receive financial help from family and friends.

The online survey of nearly 1,800 people ages 19 to 39 also found 57 percent believed they were “financially independent.” But in a separate question, 33 percent said they received financial support from family and friends.

Bauer was caught by surprise when her job at a resort in Kohler, Wis., was cut four years ago, one year after she got divorced. The single mother bounced around to several lesser-paying jobs, declared bankruptcy and even moved 60 miles south to Milwaukee.

Her daughter, now 12, moved in with Bauer’s ex-husband near her hometown.

Bauer decided to move to be closer to her and in December she found a job with the Experimental Aircraft Association in nearby Oshkosh. She tried to buy a house but needed 5 percent down. She only had 2 percent. She’s now saving for a down payment and hopes to have it as early as June.

Bauer said she gets along well with her parents and knows she’ll never get to spend so much time with them again. But it hurts her ego to live at home.

“I’ve had people say to me, ‘Oh God, I could never do that,’ ” she said. “But you take humble steps in order to move forward.”

Talk to us

More in Herald Business Journal

FILE - A Boeing 737 Max jet prepares to land at Boeing Field following a test flight in Seattle, Sept. 30, 2020. Boeing said Tuesday, Jan. 10, 2023, that it took more than 200 net orders for passenger airplanes in December and finished 2022 with its best year since 2018, which was before two deadly crashes involving its 737 Max jet and a pandemic that choked off demand for new planes. (AP Photo/Elaine Thompson, File)
Boeing inks deal for up to 300 737 Max planes with Ryanair

At Boeing’s list prices, the deal would be worth more than $40 billion if Ryanair exercises all the options.

Logo for news use featuring Snohomish County, Washington. 220118
Four recognized for building a better community

Economic Alliance of Snohomish County hosts annual awards

Logo for news use featuring Snohomish County, Washington. 220118
Business Briefs: Pandemic recovery aid and workforce support program

Snohomish County launches small business COVID recovery program, and is now accepting NOFA grant applications.

Elson S. Floyd Award winner NAACP President Janice Greene. (Olivia Vanni / The Herald)
Janice Greene: An advocate for supplier diversity and BIPOC opportunities

The president of the Snohomish County NAACP since 2008 is the recipient of this year’s Elson S. Floyd Award.

Emerging Leader Rilee Louangphakdy (Olivia Vanni / The Herald)
Rilee Louangphakdy: A community volunteer since his teens

Volunteering lifted his spirits and connected him with others after the death of a family member.

Emerging Leader Alex McGinty (Olivia Vanni / The Herald)
Alex Zitnik-McGinty: Find a group you like and volunteer!

Her volunteer activities cover the spectrum. Fitting in “service work is important as we grow.”

Opportunity Lives Here award winner Workforce Snohomish and director, Joy Emory. (Olivia Vanni / The Herald)
Workforce Snohomish receives Opportunity Lives Here Award

Workforce offers a suite of free services to job seekers and businesses in Snohomish County.

Henry M. Jackson award winner Tom Lane. (Olivia Vanni / The Herald)
Tom Lane: An advocate for small and local businesses

The CEO of Dwayne Lane’s Auto Family is a recipient of this year’s Henry M. Jackson Award.

John M. Fluke Sr. award winner Dom Amor. (Olivia Vanni / The Herald)
Dom Amor: Working behind the scenes to improve the region

Dom Amor is the recipient of this year’s John M. Fluke Sr. Award

Dr. David Kirtley at the new Helion headquarters in Everett, Washington on Wednesday, Jan. 19, 2022  (Olivia Vanni / The Herald)
Everett nuclear fusion energy company nets first customer: Microsoft

The Everett company, on a quest to produce carbon-free electricity, agreed to provide power to the software giant by 2028.

Hunter Mattson, center, is guided by Blake Horton, right, on a virtual welding simulation during a trade fair at the Evergreen State Fairgrounds in Monroe, Washington, on Wednesday, May 3, 2023. High school kids learned about various trades at the event. (Annie Barker / The Herald)
Trade fair gives Snohomish County kids glimpse of college alternatives

Showcasing the trades, the Trade Up event in Monroe drew hundreds of high school students from east Snohomish County.

A Tesla Model Y Long Range is displayed on Feb. 24, 2021, at the Tesla Gallery in Troy, Mich.  Opinion polls show that most Americans would consider an EV if it cost less, if more charging stations existed and if a wider variety of models were available. The models are coming, but they may roll out ahead of consumer tastes. And that could spell problems for the U.S. auto industry, which is sinking billions into the new technology with dozens of new vehicles on the way.  (AP Photo/Carlos Osorio)
Tesla leases space at Marysville business park

Elon Musk’s electric car company reportedly leased a massive new building at the Cascade Business Park.