Millennial living arrangements: More adults age 26 to 41 live with their parents

GREENVILLE, S.C. (FOX Carolina) - Households are growing, but not in the way you might think. It’s been found one in four people age 26 to 41, live with their parents. There are several reasons why, but what should you do with the extra cash?

Experts like Ashton Lawrence, Goldfinch Wealth Management partner and financial advisor, point to the change in mortgage interest rates over the last seven years as part of what’s fueling changes in housing.

“That’s changed the whole financial landscape drastically,” Lawrence said. “Everything is interconnected. If you end up squeezing a balloon on one end, it’s just going to inflate somewhere else.”

Which is why Lawrence isn’t surprised by recent data from PropertyManagement.com that finds half of young adults move back home to save money and 40% say rent is unaffordable. What’s also not surprising is 30% also say they prefer living with their parents.

“I would say, yes, living with your parents may not be a bad thing,” Lawrence said. “Own that uncomfortable feeling and take this time to actually better your situation.”

Other data shows in two dozen European countries, 40% of young adults live with their parents. But experts still urge all adults living with their parents to create a budget and have a long-term goal.

“If you have no clue what’s going in and you have no clue what’s going out, you’re really going to be at a loss,” Lawrence said.

Next, look for ways to increase your income. Data shows almost half of young adults living at home, typically take an additional job.

“You might want to take another job, ask for a raise or monetize a hobby or a skill,” Lawrence said.

Another tip, if your cash flow is low and you have a lot of debt, pay off the debt.

“Compounding interest works great if you’re investing – it works in your favor,” Lawrence said. “If you’ve got debt, it’s working against you and the longer that you keep that debt, the longer it’s working against you.

Lawrence also adds if you don’t have debt, it’s time to refocus on saving and retirement.

“Whether that’s a 401(k), an HSA, a taxable account, a non-qualified account – if you’re under the income limit it might just be let’s start looking at a Roth IRA,” he said.

He also advises against sticking strictly to social media for financial advice and encourages speaking with a real financial advisor.

“It’s prudent to go out and see based on your situation what you might have access to because there might something that’s available to you, to your benefit that you might not be aware of,” he said.

Experts also suggest an emergency fund of at least three to six months of savings as part of proactive planning.

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