Should Working, Adult Children Who Live at Home Pay Rent? By Kevin SunThere are many reasons why\u00a0it\u2019s a bad idea to financially bail out your adult children\u00a0when they\u2019re already working, but things are a bit more complicated when it comes to living at home\u00a0rent-free. Children who are used to the comforts of their family home might expect the same comforts in adulthood, even if they can\u2019t yet afford what you took years or decades to build. Yet letting them live at your home for free comes at a great cost to everyone. Here are 4 points to consider when deciding if and how you should charge your adult children rent:Paying Rent Helps Both Your and Your Adult Children\u2019s Finances in the Long Run Moms and Dads often underestimate how much it costs them when they allow their kids to live at home rent-free into their 20s, 30s, and beyond. Many times they\u2019re forced to put their own plans on hold, or\u00a0they risk jeopardizing their retirement\u00a0because they\u2019re in debt.\u00a0The fact is that if you\u2019re in financial trouble, you\u00a0can\u2019t afford\u00a0to let anyone stay in your home for free \u2013 even your sons and daughters. After all, you can\u2019t support them if you can\u2019t support yourself. It\u2019s obvious why getting rent money helps parents, but what\u2019s often overlooked is that in the long run, paying rent helps adult children too. If you already have enough money, you might feel that being your children\u2019s financial support pillar is the right thing to do. However, all adults eventually need to be responsible for their own living costs. You can\u2019t stop that from happening, but you can help prepare your children for it by getting them to pay rent. This will teach them to\u00a0be responsible for their own financial wellbeing\u00a0so that when you\u2019re eventually no longer with them, they\u2019ll still be able to take care of themselves. Why Messing Up Financially Might Be Good for Your Adult KidsEven If Your Adult Children Need to Save, You Can\u2019t Always Control Their Spending If you\u2019re financially stable and your adult children are\u00a0saving for a big purchase like a home, then letting them live rent-free so they can save faster might be a good idea. However, this requires a lot of either control or trust from you. If you control their finances and force them to save, then they\u2019re not learning how to spend wisely and could run into trouble later. If you trust them, then you\u2019re accepting the risk that they might take advantage of your kindness or make decisions you don\u2019t agree with. One way to get around this is to still charge them rent, save that money yourself, and then give it back to them as a gift when they\u2019re ready to make the big purchase (and move out). Even if money will go back to them in the end, be strict about collecting rent so that they take it seriously too. A rental contract, just as you\u2019d do with a stranger, will make your expectations clear. You may also not want to tell them your plans to gift any rent money back to them. Keep in mind that as adults, your children might bring partners or spouses into the picture who may influence their financial choices or even put an additional burden on you with poor spending habits. Be clear with your boundaries so that they don\u2019t accidentally overstep them.Transition Plans Work Better than All-or-Nothing Rather than go straight from free housing to demanding market rates, consider easing your adult children into paying rent by starting lower and building up. This will give them time to\u00a0fix their budget\u00a0so that when you do start charging full price, they\u2019re not making bad financial decisions just to pay you. How your transition plan works will depend on you and your family, but make sure that expectations are crystal clear on both sides. As with most things, there can be\u00a0room for negotiation when discussing the plan. Your kids will be much happier with paying rent if they feel like they had a part in deciding how they\u2019ll do it. However, make sure you\u2019re not taking advantage of each other. Just like good fences make good neighbours, clear expectations make for smoother relationships.For Families, Rent Can Come in Many Forms When you live in a stranger\u2019s property, you pay rent by giving money and that\u2019s usually the end of it. But how rent is paid when living with family can be much more flexible. The most common example is to have the children cover a part of household costs such as food and utilities. They could also do chores and other work for you to lower or replace their rent costs. This works especially well for children who are still in school or just entering the workforce. For cultures where\u00a0multi-generational living\u00a0is common or expected, this can also be a great way to make sure everyone is chipping in their fair share. Even if this isn\u2019t your household culture, splitting costs or housework could help your family feel more like a team and less like strangers. A combination of directly paying rent money and paying rent in other ways might help you and your adult children reach a happy medium. Just be sure to\u00a0track all of your household expenses\u00a0so that it\u2019s clear exactly how much your kids are contributing.Worried About Your or Your Adult Children\u2019s Finances? We\u2019re Here to Help In these tough times, it\u2019s hard for young and old alike to keep up with their costs. Both you and your children can achieve financial well-being, and if you need help, we\u2019re here for you. Call us toll-free at\u00a01-888-527-8999,\u00a0send us an email, or\u00a0chat anonymously\u00a0to get started. One of our credit counsellors would be happy to answer your questions and help you find solutions in a free and confidential appointment. Knowing your finances are taken care of will help give everyone in your family peace of mind.