My Adult Child Wants to Move Back In — What Should We Do? (DM Mail Bag)

THE BIG THING I WANT YOU TO KNOW:

Welcoming home adult children who can’t seem to get their feet underneath them is what family’s all about. However, parameters and expectations should be clearly communicated from the start. This is the DM Mail Bag.

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you write, we respond

Responding to your most pressing questions from our mail bag is one of my greatest rewards.

Nothing question’s too simple or off-limits or off-topic, so let’s tee up the questions.

 
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Question #1

Michael asked us “I have a 401k from my employer. It’s only growing at 6 to 8 percent a year. I haven’t even broken a $100,000. I’m contributing 15 percent with a 6 percent company match. I’m also investing in an IRA. I have rougly 15 more years to work -- is there a more aggressive option? Can a 401k be rolled over into an investment group that will manage it more aggressively? What options do I have?”

If you have a 401k at your company, you cannot move it to a private investment group unless you’re 59.5 years of age or older. Once you hit 59.5, many companies allow for an in-service transfer. That means you can roll your money out to a private investment firm (like Dynamic Money… maybe?!) into an IRA. If you leave the company, then all bets are off and you can take your money wherever you please.

Considering the flat state of the market, a 6 to 8 percent return is pretty decent and kind of surprises me. When people in your similar situation visit us and here’s what we do: even if you can’t move the money out, we’ll look at your investment options and we’ll help make sure that the way you’re invested fits the risk that you should be taking.

question #2

Jan emailed us “My son graduated from college last year and has had a hard time finding a job. He’s now asked if he can move back in with his dad and me. What are your thoughts on having adult children move back in? Is this healthy and what kind of boundaries would you recommend?”

I can’t say too much on this because you’re asking someone who did move back in with his in-laws (plus two kids) after college. At the time, my wife was very ill and unable to work. I was supporting our family on my meager youth pastor salary. As someone who’s been on receiving end of family kindness and generosity, I understand how this is something that you want to offer your son.

It comes down to knowing your child and open communication. If you know that he’s been pounding the pavement, networking and interviewing and just nothing has broke his way, I would say it’s okay to welcome your son home.

I suggest to draft a physical contract between you and your husband and your son. It should outline the timeline, expected contributions, expectations and a specific date you three will reevaluate the living situation. Leaving the arrangement open ended doesn’t set any one up for success and could lead to rifts. I’m sure everything will work out as it should and I hope your son lands on his feet soon!


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