How Genzennials Moving Back Home Is Reshaping Household Finances

In recent years, more and more young adults have been moving back in with their parents, largely fueled by a combination of economic challenges and personal factors. This trend has been most prominent among younger millennials and older Gen Zers — aka genzennials — dubbed the “Boomerang Generation.”

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Pew Research reports that 24% of adults between 18 and 34 have returned to their parents’ homes in recent years, driven by rising living costs, student loan debt and overall financial instability. As many struggle to achieve financial independence, the impact of these living arrangements is significantly altering the financial dynamics within families .

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What’s Really Causing This?

One of the biggest factors behind this trend is the cost of housing. From 2019 to 2023, rent prices jumped by 30.4%, while wages increased by only 20.2%. This has been particularly tough in cities like Atlanta, Miami and Phoenix, where many are now spending over 30% of their income on rent. These rising costs are also linked to the broader issues of homelessness and persistent inflation.

Another key factor is the heavy burden of student loan debt. By 2023, total student debt in the U.S. had reached $1.7 trillion, leaving many graduates financially stretched and unable to live independently. The Federal Reserve reports that 55% of young adults with student loans say the debt has affected their ability to afford housing and save for major milestones like buying a home or starting a family.

The COVID-19 pandemic also played a major role in the rise of the Boomerang Generation. Many young adults lost jobs or faced pay cuts during the pandemic, prompting them to return home as a way to reduce financial strain.

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Affect on Household Finances

When young adults move back home, the impact on household finances can vary — either positively or negatively — depending on how much they contribute. While some help with expenses, Pew Research shows that only about a quarter regularly pay rent or cover bills. This often increases the financial strain on parents, particularly those nearing retirement, as they take on higher costs for food, utilities and supplies.

On the flip side, many families find ways to make the situation work for everyone. Adult children may help with household chores or child care, reducing the need for outside services. For young adults, living at home provides a chance to save money, pay off debt and build up their savings.

However, having adult children move back in can also create financial strain for parents, especially if they are older. Many parents end up tapping into their savings or delaying retirement, while others may put off plans like home renovations or travel. In some cases, parents even take on additional debt to cover household expenses, which can threaten their long-term financial security.

How To Manage the Situation

Experts suggest that clear communication and setting financial boundaries can help families manage these situations better. Discussing household contributions early on, whether it’s paying rent or helping with groceries, can prevent misunderstandings and ensure that everyone benefits. Open conversations about financial goals — both for parents and young adults — can make these arrangements smoother.

For young adults, living at home can be a great opportunity to focus on saving and paying off debt. But experts warn that staying too long without contributing or planning for the future can delay progress toward key milestones like buying a home or starting a family.

As more young adults move back in with their parents, the financial effects are being felt across households. While there are benefits to these arrangements, it’s important for both parents and adult children to navigate them thoughtfully to avoid long-term financial issues.

This article originally appeared on GOBankingRates.com : How Genzennials Moving Back Home Is Reshaping Household Finances