Multigenerational living in the U.S. is becoming quite a trend. While culturally mainstream in countries across the globe, American extended families have shied away from living under one roof for decades. But those societal norms are rapidly changing. Why? Because household sharing has lots of benefits for everyone involved. From cost of living to childcare to socialization and beyond, multigenerational living just makes sense for families. And it comes as no surprise that as the baby boomers age, many adult children are taking them in.
Now, family dynamics can get complicated quickly when you’re sharing the same square footage day in and day out. If you’re considering combining households with an older family member in the foreseeable future, there’s lots to plan for. Here are the most important financial questions to think about now to help avoid potential surprises later:
- How will this change affect your monthly expenses?
- Will your monthly budget need to be adjusted?
- How will you split up household costs so that nobody gets taken advantage of?
- Will you have any financial help from siblings or other relatives?
- Can you continue to save for your personal financial goals?
- Do you need to update your home to make it more handicap accessible?
- Are you planning to renovate beforehand?
- Can you afford to build an addition? How about a small guest home?
- Do you need to purchase furniture?
- Will the space you currently have still be functional as your loved one gets older?
Daily elder care:
- Can you provide the day to day care for your family member?
- How will you handle care while you’re at work, traveling, or otherwise away from the house?
- Do you need to hire additional help now?
- Will you need more help in the future?
Writing down a financial plan which takes these topics into account is a great way to go. Agree on how to move forward, review your plan often and update it as time goes by. Be cognizant that your aging relatives will likely have additional needs in the future. Think long term so you’re not blindsided unnecessarily. And don’t forget to have an ongoing dialog to avoid any hurt feelings, disappointments, or hidden animosity. If we can be of any help in the process, just give us a shout.