Posted By susanne On March 4, 2013
How would you feel if Mom and Dad became your roommates?
For some families, it’s a reality as they give shelter to financially struggling parents or ill parents who can no longer care for themselves.
But as much as you may want to repay your parents for their care of you, you have to look at the financial and emotional ramifications of taking them in.
“Parents are in the habit of taking care of their children,” says Rick Salmeron, certified financial planner at the Salmeron Financial Network. “The flow of wealth from older to younger generation feels natural to many.”
But changing demographics is making the reverse more common.
“We are living so much longer now,” Salmeron says. “The older generation may be running out of savings, or may be mentally or physically unable to tend for themselves. The younger generation had better do more thinking about possible new roommates — their parents — and how they might prepare themselves.”
Here are the areas you need to look at:
“When considering having a parent come live with you, there are direct costs and indirect costs,” said Tom Murphy, certified financial planner at Murphy & Sylvestin Dallas.
Direct costs include groceries, household supplies and dining out. Indirect costs can include increased utility bills, higher auto insurance rates if the parent is still driving, and more laundry, hobby or activity costs of the parent, he said.
“Adding one person to a home with two will increase these variable expenses by an average of 23 percent, according to U.S. census figures,” Murphy said.