The term “boomerang kid” is nothing new. Many college students move home after graduating college to look for a job, save some money, and figure out the next step of their post-grad life.
But the pandemic caused a huge spike in young adults returning home to the nest. And a new study has found that more than two years later, the majority of kids who moved back in with mom and dad are still there — and for some pretty solid reasons.
At the start of the pandemic, many kids moved home because they had no choice — college campuses were closed, much of the world shut down, and no one was hiring. Though some did have plans to boomerang back to their parents’ for a bit, many have stayed a little longer than expected. The world has “opened back up” in many ways, but kids are still hanging out at home with their parents.
In fact, more than two years later, 67% of millennials and Gen Z who moved home in 2020 are still living with their parents, according to a recent report released by LendingTree.
Why aren’t they moving out? There are a number of factors, and they’re sometimes working together.
Large student loan payments and high cost of living (that keeps getting higher) in most areas have made being independent after college tough those just starting out. Even when landing an entry level job after graduation, many salaries are not compensating enough to pay for housing costs.
“With inflation as high as it is and with rates rising, it can be difficult for anyone to make ends meet in today’s economy,” said Jacob Channel, LendingTree’s senior economist.
According to the National Center for Education Statistics, the average student with a Bachelor’s degree in 2022 is averaging a salary of $59,600. If that student wanted to live in a major US city where they would more likely be able to find a well-paying job, meet friends and begin a new chapter of life, such as Austin, Texas, a one-bedroom apartment would cost them a cool $2,245 a month. That’s almost half of a month’s paycheck going to rent alone.
Again, boomeranging back after college is nothing new and has been on the rise since the 1960s. The concept of multigenerational living is common across the world, and in the U.S., the number of households with two or more adult generations has quadrupled over the past five decades, according to a Pew Research Center report based on 50 years of census data.
However, the pandemic launched a large spike in the growth that sent millions of young adults back to sleeping in their race car beds.
“The pandemic was a short-term rocket, but the levels today are still significantly above where they were in 2019 — and it’s been rising over the past 50 years,” said Richard Fry, a senior researcher at Pew.
Now, 25% of young adults live in a multigenerational household, up 16% from 1971.
Pew also found that the typical 25- to 34-year-old in a multigenerational household contributes just 22% to the total household income and their parents or caregivers are picking up the rest of the tab.
However, in an ever-changing economy like today’s, supporting grown children — buying groceries, paying for gas, etc. — can be large financial drain when their own bank accounts could be looking a bit lean.
Given the difficulties in the job market, the housing market, and the economy over the past three years, will the number of kids graduating college continue to go back to mom and dad’s continue to rise? Seems like only time will tell — but maybe wait to convert that old bedroom into an office.