“The 20 Somethings”
I was having coffee with my friend the other day at our usual spot. Once again and as typical the conversation always leads back to our “20 somethings” You know you’re in good company when you can tell it like it is, no pretending you have the perfect husband, perfect kids etc. Someone you can share the good the bad and the ugly with. We chatted about the fine line of parenting “20 somethings “ that are still living under foot , oops I meant under our roof.
We laughed at the fact that kids don’t seem to have the same urgency to get outta mom and dad’s house, that they’re quite content with their come and go easy peasy lifestyle....but of course they are, if you’re anything like my friend and I you can easily be talked into making them a grilled cheese sandwich “ cause no one makes them like you mom “ hmmm… I hesitate using the word manipulation but you get my drift. It’s particularly tough on us mom’s though isn’t it. Stuck somewhere between the paradox of wanting your little monkeys all tucked in under one roof and wanting to turn that room into a sewing room , better yet a wine cellar!
So I think we can concluded with 3 reasons for this phenomenon , first we’ve made it far too comfy for them , second kids are spending longer in school not necessarily needing the perfect job right away ,content to spend their earnings on Starbucks and Skip The Dishes. The third and most understandable reason is , who can blame them for not wanting to move out, have you seen the prices of rent? If you remember our last blog, apparently the comparative between wages vs mortgages over the last 15-20 years appears to be relative to rent as well.
So how do we marry these two concepts, encouraging our sweet little “ 20 somethings “ out of Chez Mom and Dads , yet assist them to be financially responsible and invest wisely. Certainly wasting thousands on rent is often unfortunately a necessary evil but should be as temporary as possible. Last month I mentioned 4 ways we would be discussing in the months ahead on how we can assist our “20 somethings” into the market. But before we even go there I would recommend your “20 something “ be in a financial position to be paying a mortgage. Start charging them to live at home, and I suggest you be very firm on rent date, amount and charge penalties if you have to. Be prepared for some of those toddler like tantrums, with statements such as “this is my room, my house etc!!! But be firm. Remember this is a teachable moment, its the smartest thing you could do that way if they go straight from mom and dads into a mortgage they will have had some practice on being financially responsible.
You can take the money they pay in rent and put it into a TFSA for the duration, while they continue to live at home. If after a year or so of your "20 something " accumulating their 5 or 10% down this is where you have to make some decisions that will effect you in the years ahead . If you plan on helping your child(ren) with some of the down payment you have to keep in my your other children, are you or will you be able to fairly manage helping them when the time comes, because sure as sugar no matter how poorly your kids did in math they can pull facts from fair distribution of money between themselves and their sibling going back decades, so think ahead.
If you have “20 somethings” and want to get them started saving for a down payment, I have a great checklist for them, just get in touch with me. If you have any questions or remarks please feel free to comment, send a private message ,or better yet , let’s do coffee