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Moving Back With The ‘Rents to Take Care of My Finances

This is a guest article by Glen Craig, the publisher of Free From Broke and Parenting Family Money. See how he currently deals with his family and finances and find out how you can too. In the article, Glen shares his story of how moving back with this parents provided a second chance for his financial life, mirroring a similar experience in my life. It’s a common thread with the “Boomerang Generation.”

Once upon a time there was a care-free bachelor. He had his own apartment, a full-time job, lots of credit card debt, and virtually no savings. That person was me.

I moved out of my parents’ place before I understood what it really meant to take care of my finances myself. I got by, though. My rent was paid on time, as were my utilities, but over time, my credit card debt grew. And when I say I got by, what I really mean is I was living paycheck to paycheck, crossing my fingers that I’d have enough money until my next paycheck came.

Living on your own is expensive. I don’t need to tell you that. And the money for all of the little things had to come from somewhere. Dishware? Credit card. New broom? Credit card. Going out? Credit card. CD player dies and I need a new one? Credit card. You get the picture.

I managed to get thousands of dollars in credit card debt, and all with just about zero savings.

I knew it was no way to live. I hated seeing my credit card debt growing without anything to really show for it besides my CD collection. (Remember those?)

So I started to wise up and figure out how to get rid of my debt. I called up my credit card companies to get my interest rate lowered. I made sure to get my bills paid on time after getting hit with a bunch of late payments. I did what I could to pay more than the minimum. I even transferred a balance or two to new cards with zero balances so I could pay my debt off faster. I stopped putting so much on credit — if I couldn’t pay for something, well I couldn’t get it.

I saw my debt going down but not by as much as I wanted.

Then an interesting thing happened: I lost my apartment.

I was living in a converted one-bedroom apartment basement in a house. What I didn’t know was that the house wasn’t zoned to be two-family. Somehow the city found out and I was forced to leave the apartment. What to do? My rent was pretty reasonable where I had been — and know I knew why. Finding a new apartment would mean higher rent, a bigger security deposit, and probably paying a broker’s fee to get a place. That was a lot of money I would need up front, and remember, my savings were hardly existent at the time.

Quite honestly, I felt choked just thinking of how I was going to afford another apartment. I mean it, I felt sick. I was just getting to the point where there was a dent in my credit card debt and I was slowly starting to put away money into my savings. I was even getting smart about retirement, upping the percentage I was putting into my 401(k) at work.

There was another choice, but it wasn’t pretty: move back in with my parents.

Look, I love my parents, and they have always been there when I needed them, but giving up my freedom was a hard pill to swallow! The alternative was going back to just eking by on my paycheck because I had to pay more in rent every month.

I sucked it up. I needed to retreat and build myself back up financially before I could live on my own again. It was the only way to even have a real financial future.

My parents were awesome and welcomed me back with wide-open arms. I agreed to pay them a rent for my room and utilities, an expense that was much lower than any rent I would find.

It wasn’t easy. Moving back with my folks and my sister brought back a lot of memories, wounds, and arguments. If I was going to start-over with my finances in order to put my financial future on the right path, I would have to make sacrifices, and this was one of them.

Moving back with my folks meant that my paycheck stretched much farther than it had in a long time, but I didn’t go and blow it all. I tried to be smart about this second chance. I started putting money away in savings. I had heard about this online bank, ING Direct, that I took a chance on, socking away a good amount of savings every month. I increased the percentage that was going into my 401(k). This was a little bit after a stock market crash, so I was purchasing the funds in the plan relatively cheap.

Next was the credit cards. I was putting a lot into savings, but after some time it dawned on me that I was still paying a lot in interest on my credit card debt. I was paying more than the minimum payment, mind you, but there was still a lot of debt to take care of.

What was the point of saving more money if I was still losing on credit card interest? I switched things up and attacked my credit card debt. I put all I could into paying off that debt. With my new lower rent and expenses it didn’t take long to pay of my credit cards entirely. You don’t know how good it felt to mail out that last check!

With the next paycheck after paying off the credit card debt, I started putting money back into savings. I realized something. For the first time in I don’t know how long I actually had a positive net worth! I wasn’t in debt anymore. It was such a liberating and validating realization. The money in my paycheck was mine again and wasn’t slated for a credit card company. Yes!

It was a tough road, but after many years of increasing my debt without a whole lot to show for it I was able to come out ahead again.

Fast forward many years. I’m now married to a beautiful woman with three awesome kids. We just moved into our first house this past summer, a house we purchased with a down payment of more than 20 percent, in large part because I was able to wake up about my finances and take steps to improve my situation. And we have zero credit card debt.

If you told me when I moved out for the first time that I would move back with my parents, and it would be one of the best financial decisions I would make, I’d have told you that you were crazy. But it was one of the best moves, by far.

Here’s the moral of this story. You’ve heard other people say it, but if I can get out of credit card debt then anyone can. It’s about being able to make the sacrifices. For me that meant moving back with my folks. What does it mean for you to get out of debt?

Photo: erix!

Updated April 26, 2011 and originally published April 22, 2011.

About the author

Glen Craig is the publisher of Free From Broke and Credit Card Smarts. He's married and a stay-at-home-dad to three children. Glen started blogging in 2007 so that others wouldn't have to be as confused as he was with personal finances. View all articles by .

{ 43 comments… read them below or add one }

avatar 1 Kristia

You mentioned that by moving back with your parents, you were giving up your freedom. But really moving back with your parents brought you freedom. I made a similar mistake after college. I insisted on moving into my own apartment when my parents were pleading with me to live with them, rent free, and pay off my student loan. I never took them up on the offer; I was too stubborn on being ‘independent’. I eventually paid off the loan, but I would have done it much earlier had I listened to my parents.

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avatar 2 Anonymous

You make a good point Kristia. The freedom I gave up was a short-term social freedom, while moving back allowed me to have a long-term financial freedom.

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avatar 3 tbork84

I managed to avoid moving back in with my parents, but it certainly took a lot of effort and work on my part to become self-sufficient and learn to control my finances. I have a sibling or two who moved back home after college, and it worked out very well for them to get a start on saving and their careers.

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avatar 4 Glen Craig

You know, I didn’t mention that when I was going to college I was still living at home with my parents. That was part of the reason I moved out when I got a chance.

Moving back for the right reasons can definitely work in getting a head-start on your financial situation.

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avatar 5 Anonymous

Glen, I’m glad you paid rent and utilities. That way you respected the sacrifice your parents were making for you.

Sounds like everything worked out for the best.

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avatar 6 Glen Craig

I wouldn’t have felt right trying to take of my finances while not chipping in my share. At one point my Dad told me he would understand if I didn’t pay anything but I wouldn’t let myself go that route.

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avatar 7 skylog

i agree dr dean, i have read many similar stories online where this was not the case. not even at some “token” rate. it just floors me. everyone who moves back in seems to stress everything they are giving up, yet very few of these same people respect what their parents are giving up. clearly, they are your parents, they would more or less do anything for you, but do not think for a second they are not giving in these arangements as well.

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avatar 8 Anonymous

You’re right. I think if a child is moving back they shouldn’t think that life should be like it was when they were younger, before they moved out.

I think the child should want to help out financially and understand why they are back and I also think the parents need to set some rules for their kids to make them understand that things are different; the kids should understand they are adults now.

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avatar 9 Sarah

That was a really great story about getting back on track.

I like the idea of paying rent/utilities to your parents. I imagine that helps them out a bit financially as well.

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avatar 10 Glen Craig

I guess it helped them a bit overall but it mostly covered what I was using.

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avatar 11 Ceecee

When I was starting out, I drove a very old car. Some people would laugh. But a relative and I bought a house in our twenties. We sold it ten years later for twice what we paid. It gave me a nice cushion when I moved on. I’d never buy a new, fancy car. It just depreciates, and you can’t live in it—well, not easily.

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avatar 12 Anonymous

I would totally move back in with my parents in a heartbeat if they lived within 1 hour of where I currently worked or would like to work. No brainer and no shame at all!

It does help they have a nice house though….. :)

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avatar 13 Anonymous

People need to suck in their pride and really work on getting these debts rid of… You are an inspiration.

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avatar 14 Glen Craig

Let me tell you, I sucked in a LOT of pride. But it was all for the best. Thanks for the kind words Forest.

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avatar 15 shellye

When I was in college, I faced a couple of hard times when my temp job or campus job would end and I would struggle to pay my little electric and utility bills (I had a very small apartment). Even though I would eventually find another part-time job, I would use credit cards to fill in the gap for gas, groceries, school supplies, etc. Although my parents and I have always gotten along beautifully and have always been close to me, I would rather pull my fingernails out than move back in with them. LOL! Once you experience freedom, there is no going back!

My solution to getting out of debt at that time was rather stupid…I got married. Not for that reason, but it was a convenient benefit at the time. He had already graduated and had a full-time job w/benefits. I was just graduating and had started a full-time job, but had saved no money and had about $5k in debt. After the wedding, we used his savings to pay off my debt so we started our marriage debt-free. I wouldn’t recommend marriage as a solution to one’s debt problems, though. Great article, Glen. I can only hope my college-age kids learn from my mistakes so that they don’t have to move back in with me! :-)

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avatar 16 Glen Craig

Haha, I think a couple of my fingernails are just growing back! The same happened with me and my credit cards – they would fill in the gaps between paychecks.

I love my kids but I hope when they are ready to leave the nest they are equipped to fly on their own and stay on their own.

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avatar 17 Donna Freedman

Keep in mind that a lot of PARENTS would rather pull out their fingernails than to have their fully fledged younguns fly back to the nest.
It’s good that you paid rent and utilities. I would recommend that anyone thinking about asking to move back home sit down with the ‘rents (accurate abbreviation, that one) and hammer out some basic rules. That way if your parents’ expectations are untenable, you can look for a different solution — or at least prepare to be home by 11 p.m. because your folks just can’t sleep for worrying over you.

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avatar 18 Anonymous

Yes Donna, you are probably right. I’m probably no saint to live with (perhaps my wife is though for putting up with me). I’m sure I added a couple of grey hairs to the ‘rents heads.

Having a plan with the folks is a great idea. This way the boundaries and expectations are set out before-hand.

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avatar 19 Anonymous

I think it is a cultural thing for me. I would move back with my parents in a heartbeat. In Asia, “nuclear” family trend is recent. My parents lived with their parents along with me and my sister. I would get back that joint family.

Back to topic, I am glad everything worked out. You probably gave up some social freedom to lay your path to financial freedom.

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avatar 20 Anonymous

Hmm, I have seen that in different cultures where more of the family stays together. That’s a great thing. I’m sure if I grew up like that then moving back, or moving out even, would have been a different matter altogether. I love how in a nuclear family like that you have grandparents that can take care of the grandkids. That’s gotta be nice having everyone so close.

I should note that moving back also gave my parents and I new respect for each other. I understood what it took for them to keep the household going growing up and how they had my back when I needed it and I think they were able to see my determination in fixing a problem I created and that I would turn to them for help.

As for freedom, it was absolutely a trade-off. But definitely well-worth it.

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avatar 21 KNS Financial

I hope I can get a lot of people to read this before running out to be on their own! It’s great that you were able to get over any apprehensions you had about moving back – I’m sure your wife and children are thankful!

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avatar 22 Anonymous

Well, when I met my future wife I met her without any debt and with a decent amount of savings. Much better than being in debt!

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avatar 23 Anonymous

I lived with my folds immediately after college and then later during a medical issue. After college, I thought it was great, I could max out my 401K on my small salary and I learned to cook, because my parents purchased the groceries. Life goes by so fast that it is so worth it. I would love to have my kids live me if it helped them financially.

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avatar 24 Anonymous

I was putting a nice sum into my 401(k) after I moved back. It’s grown quite nicely. Moving back with my folks helped me plant the seeds of my retirement. For that I’ll alwasy be grateful.

I would always do what I could to help my kids. There will come a day when I just might have to tell them this story to help them determine if they are really ready to move out.

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avatar 25 Anonymous

I had a friend post college who moved to Sunny land to live the dream. He barely scraped by living with his sister and then as it seemed like he was longing to escape the high cost low pay San Diego, my wife and I offered, knowing he had literally no money, we’d let him stay rent free for 6 months in our basement and then charge $400 a month. (it’s unfinished, so the $400 was more an incentive for him to find an alternate solution than for us to collect rent).

He stayed 7 months for $400, rarely helped cover costs for food, found a part time job to cover the other stuff for 6 months and when the $400 rent started, we finally found him a full-time job (through an old college roommate of mine). He did help w/ cooking/cleaning and such.

I begged him to sell his car that was too much money for someone with his income ($350 a month) and he never did. He still owns the car to this day now paid by cashing out his retirement when he got laid off. Several years later, he’s lived on his own, and living an active life style but he’s had stints of unemployment and periods of living in other friends basements for cheap… I love having him around but we’re in our early 30’s now, it’s time to grow up. I think he’ll get there some day but he doesn’t have the drive that one needs to seize the opportunity but has the drive to enjoy life and get by. I want more for him. Hope he figures it out someday.

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avatar 26 Anonymous

I’ve known people like that. It’s hard to watch. You want to help but the truth is they have to want to change themselves. I hope your friend can figure it out for himself.

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avatar 27 Anonymous

Great story. Thankfully we are all a little older and wiser. Looking back, pride is such a silly thing. Glad your sacrifice worked out. Now it makes for a good story and lesson for everyone!

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avatar 28 Anonymous

Indeed it does make for a great story and lesson! I’m glad I was able to share it.

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avatar 29 Anonymous

My parents gave me a six month maximum time frame if I had to move back in with them. Quite “Amy Chua” of my parents i’d say.

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avatar 30 Anonymous

Six months is quite the incentive to make things happen!

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avatar 31 Cejay

Great story Glen. I love the fact that you were willing to make that sacrifice to get back on tract. I could have never moved back in with my parents since they would revert back to me being 16 years old. But I was willing to make the sacrifice of no new clothes, making do with what I have and anything else I could do in order to pay off those bills. The freedom I now feel is priceless.

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avatar 32 Anonymous

I tried cutting back on everything but I needed a bigger boost to take care of my debt. Glad to hear you were able to do whatever it took to knock out your bills!

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avatar 33 Abby Freedman

I spent a good chunk of my 20s in denial that I was really disabled by my chronic fatigue and severe depression. By the time I finally admitted reality, I was beyond burned out. My mom had just moved to the city I was in, and she begged me to just apply for disability and try and get my health back up to something approaching normal.

So we moved into a two-bedroom apartment for 9 months and did the best we could to get through.

I honestly don’t think I could have made it financially on my own. I am forever grateful to her for that. It wasn’t easy for either of us. She was going through some of her own life dramas and I was dealing with some very scary prospects — potentially never being able to support myself — along with severe depression. The whole situation was a huge blow to my pride, and I didn’t really handle it well. But she bore it pretty well. Overall, she saved me in so many ways — including insisting I go to therapy, even though it drained what savings she had.

While I did end up on disability, I was eventually able to find a job I can do around my limitations. (It took six years from the time I moved in with my mom, but I’m just thrilled I found it!) I’m now off disability, and my husband and I were even able to move out of state and maintain financial independence (including freedom from most of our debt), which is huge. Still, I know I wouldn’t be where I am today if I hadn’t had a parent who was willing to sacrifice so much.

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avatar 34 Anonymous

I think one of the toughest things about being a parent is seeing your child hurting. Another tough thing is knowing when to back away and let a child be on their own or to get involved. Sounds like your Mom really came through for. You’re real fortunate. Glad to hear you’re financially independent with your husband.

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avatar 35 tigernicole86

I’m glad to hear everything got worked out! I was lucky enough to move in with my grandparents the summer after I graduated from college when I got a temp job. We carpooled(my grandmother worked about 2 blocks from where I got my temp job on a college campus), and I got fed and had a place to stay really cheaply. And by cheaply, that meant taking care of the dog when they were away on vacation for 2 weeks(and their dog is awesome.). I was able to take care of some debts, throw some money at my student loans, and be fed. Yay!

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avatar 36 Anonymous

My family (My mom, brother, and I) doesn’t own a house but we pay a relatively cheap rent. I’ve been away for college and now I’m graduating soon, my mom wants me to move back home. The thing is, my mom and I share the same bedroom because there’s only two bedrooms in the house and my brother have the other one. I am thinking what we can do is to to move to a three bedroom house ( I predict the rent would cost double since we have lived in the current place for a long time and the landlord has not increased our rent over the years) or, I simply move out and have my own place, which is what i would prefer. It would be greatly appreciated if you can give me some advise on this! Thank you.

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avatar 37 lynn

This is more common today than people would think. My son moved back after going through the same stubborn stage. Ah the thoughts of youth. We beggfed him not to, as well. he made a mess of his financial life, like most other boomarangers did. Now he is on track, but still needs to think about his retirement future more than he does.

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avatar 38 Anonymous

I live with my parents, went away for school, graduated and came back. Just remember that it’s fast forward 4-5 year later.

You aren’t that 18 year old kid out of high school that left for college. At my age our relationship has evolved into a friendship. I know what I need to do and they don’t bother me much about going out, cause heck I’m old now.

I love my roommates (mom and dad)! I do pay for utilities but living rent free is really helping me get rid of my debt!

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avatar 39 Kristina

So glad to know I am not the only one who did this. I moved back after graduate school to complete a practicum for my degree.

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avatar 40 Laure

Glad it worked out for you and your parents. Another option I have seen work well is to move in with a different relative, often a grandparent or great-aunt or uncle. The older relative gets company, and perhaps some physical work around the house that is becoming difficult with age. There also aren’t the old wounds, etc that can exist between parents and children. Most friends – and people in my own family who have done this – would have been too shy/nervous/scared to approach the older family member, so I encourage the older family member to suggest it! Also, the younger family member could pay for some rent, or even just the utilites, which could really help those living on a fixed income.
As for myself, I didn’t do anything so drastic, but when the budget got tight, to avert credit card debt, I stopped buying *things.* I still socialized with friends, frugally, but wore the clothes I had, listed to the radio instead of buying CDs, etc…and have found that it’s the socializing that brings me happiness, not the things.

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avatar 41 lynn

What a good article and the comments are helpful. I always thought this type of arrangement would work out if both parties were responsible to their end of the arrangement. It’s working for us and no one is in need of food, shelter, gas, a vehicle, or clothing. DS lives his life and I live mine. He does the heavy work and I keep the house clean. I guess you could say we peacefully co exist.

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avatar 42 avonbyc

We were debt free for most of our marriage until unemployment hit. Our finances took a huge hit and we have never quite been able to come out from under it. I have been attacking our debt a little at a time and recently paid off a car loan a whole year early. At the same time I am chipping away at a credit card and have cut it nearly in half in the past two years (was a pretty big balance). We don’t have the option of living with parents but there are other sacrifices we have made- our oldest child left private school for the public school system soon to be followed by the younger one. Our “fun” revolves around “free” and if we do go to a restaurant, i find places where the kids eat free. I know there is more we can do and I am working on it even as I write this.

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avatar 43 Anonymous

When I was down on my luck my parents offered me a room back at home but I had too much pride as a man who believed himself to be independent from his mommy and daddy to move back into my childhood crib. I threw away most of my belongings and moved into a 99 square foot room with a communal toilet and shower in the hallway. The rent was 1/3 the cheapest market rent for a studio in the same town. Still, that didn’t help in paying back my debts because the money freed up was used to further fuel my addiction. Amazingly, a few years later I am in more debt and more broke but with more credit I am doing better. The crash, however, will come unless something happens. I made $30,000 extra money from a recent natural disaster which increased business but I can’t rely on Mother Nature. Perhaps, my next step is bankruptcy.

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