As shared living with spouses or partners continues to fall, there are now more people under 35 living with their parents than in the late 1800s. Why is this historic shift taking place in 2018?

The Pew Research Center recently reported that 32.1 percent of adults aged 18-34 are living at home with their parents. Broad demographic shifts in marital status, educational attainment and employment have transformed the way young adults in the U.S. are living.

The Modern Mindset

Dating back to 1880, the most common living arrangement among young adults has been living with a romantic partner, whether a spouse or a significant other. This type of arrangement peaked around 1960, when 62% of the nation’s 18- to 34-year-olds were living with a spouse or partner in their own household, and only one-in-five were living with their parents.

Throw this forward to today, and only around 31% of young adults were living with a spouse or partner in their own household. Pew says the main reasons for this dramatic shift is younger people are less willing to romantically settle down earlier in life. Millennials tend to marry later, and less frequently, than earlier generations. Only about a third of them have tied the knot, according to Pew. That compares with 44 percent of Generation Xers and over half of boomers (when they were that young).

The Gender Gap

Living arrangements among young adults differ significantly by gender:

• The rise in young adults living at home coincided with a decline in the economic status of young men. In 1975, only 25 percent of men, aged 25 to 34, had incomes of less than $30,000 per year. By 2016, that share rose to 41 percent of young men according to the Census Bureau study. (Based on the present-day dollar). Also, “There are now more young women than young men with a college degree, whereas in 1975 educational attainment among young men outpaced that of women,” says the study.
• For men ages 18 to 34, living at home with mom and/or dad has been the dominant living arrangement since 2009. In 2014, 28% of young men were living with a spouse or partner in their own home, while 35% were living in the home of their parent(s). For their part, young women are on the cusp of crossing over this threshold: They are still more likely to be living with a spouse or romantic partner (35%) than they are to be living with their parent(s) (29%).
• In 2014, more young women (16%) than young men (13%) were heading up a household without a spouse or partner. This is mainly because women are more likely than men to be single parents living with their children. For their part, young men (25%) are more likely than young women (19%) to be living in the home of another family member, a non-relative or in some type of group quarters.

Stability at Home

Once upon a time, living at home carried a kind of stigma; it was considered a sign that you weren’t progressing through life at the proper pace. Now that’s lifting. The Boston Fed found some suggestive evidence in its analysis – Among other things, a growing number of Americans now say it’s OK for older people to share a home with grown children. Almost 9 in 10 young people who were living in their parents’ home a year ago are still living there today, making it the most stable living arrangement.

Keeping Your Retirement on Track

When you have an adult child living at home it can be easy to forget your own retirement plans. Education and communication are key in making sure your retirement plans don’t get derailed if your kids end up moving back home, or never left in the first place!

1. Know your retirement needs – making sure everyone is on the same page of what your financial needs will be in your golden years is crucial. By sharing this vital information, your children can help you out financially to compensate their presence.
2. Discuss accountability and priorities – Ask yourself how much you’ll be spending in having your child/children living at home and have the conversation of their financial contributions.
3. Visualize your long-term future with your kids – Thinking clearly about the future financials and lifestyle is a sure way you won;t face unexpected surprises later down the line. Not saving (or spending your retirement savings) now will have a profound impact on both you and your children.  Are your children going to be able to take care of you in the future the way you are taking care of them now?  Addressing these tough issues right away will help iron out any instabilities in securing a happy future for the whole family.