One of the casualties of the economic crisis has been parents’ much-anticipated empty nest, or rather lack of it. It’s a refrain that is becoming all too familiar across the U.S. “Reoccupy Elm Street” is in full swing, and it’s up to your clients to shore up their defenses, according to wealth management firm Brinton Eaton. What’s on the line? Only their financial security and long-awaited plans for retirement.  

The firm suggests that clients establish firm ground rules when it comes to their adult children moving back in, commonly known as the “Boomerang Generation.”

“On one hand, you want to help your child,” according to commentary released by the firm this week.  “On the other, you need to keep an eye on your own wallet.  You also want to empower your child and not contribute to his helplessness. If your child is over 18 and comes back home once he’s done with his education—try to dispassionately assess his situation and your own—which can be difficult.” 

However, if they want to reclaim their empty nest, it’s “critical to lay down some important guidelines sooner rather than later,” according to Brinton Eaton. 

Here are six tips from the firm.

1) The rules have changed.

He may be your child, but he is no longer a kid and you expect him to behave like the young adult he is. Whenever he was younger, it was fine for you to support all his financial needs. However, this is no longer the case. He now needs to pull his own weight in terms of contributing to the household—both financially and logistically, to whatever degree he can.

2) Encourage your child to get a college degree.

For all the dismal employment headlines, one fact remains crystal clear: people with college degrees have an unemployment rate of 4.0%, versus 8.7% for those without a degree. If your child is entering college, take an active role in helping her select a course of study and degree choice. Make sure it is something marketable.  Nursing—yes. History of basket weaving—no.

3) Make it clear that your child is expected to work. 

Even if your child can’t get her dream job now, she should look for some kind of job to pay for her own expenses including gas, entertainment, etc.  If your child is employed, but wants to live at home because she has student loans, help her make a savings plan, as well as a payment plan, for the debt. Giving the gift of a financial plan will save you money in the long run.

4) Outline what your child will do to fulfill his responsibilities.

Make sure you have a timeline for how long you expect him to be with you. Perhaps part of the plan can stipulate that for a certain amount of time, perhaps six months or so, you will help him financially, but after that any money spent on his behalf can be considered a loan. It may sound harsh, but this might motivate Junior to think with more clarity and speed about what he needs to do to grow his wings and fly the coop. In addition, if it’s structured properly, it could benefit both of you on your taxes. Consult your tax provider for more details.

5) Remind your child that she is expected to be productive and helpful.

She should wash her own dishes and clean up after herself, do her own laundry, help with other chores whenever possible, and abide by any other rules set by you and your spouse.

6) Don’t lose sight of your own needs.

“It may not be easy enforcing all the rules, but it’s necessary,” the firm concludes. “Naturally, you want to help your child, but remember not to lose sight of your own needs, especially in this stressed economy. You and your spouse have put your children ahead of yourselves for years—it’s not a good idea to do this any longer. It could put a strain on your current budget, or worse, postpone the retirement that you and your spouse have been looking forward to for so long.”  


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