The Millennials Living at Home Are Laughing All the Way to the Bank
So of course, taking into consideration that a number of millennials live at home with their parents, many people jump to the conclusion that it’s because they’re lazy and not ready to face adulthood — a conclusion that’s as unfair as it is inaccurate.
Before you buy into the stereotypes, consider this: millennials want to be homeowners, and saving up for that — especially on an entry level salary — while also paying rent is no easy feat, even if you live in a city that’s known for having more affordable rent prices. And once you also factor in student debt, you piece together the picture that it can be a massive challenge for millennials to set money aside to for a down payment these days.
Every Little Bit Adds Up—and Parents Get it
According to Zillow, the median price of homes sold in the US is $225,262 and the median rent is $1,600. One year of rent at that price is $19,200, nearly half of a 20 percent down payment on the median home price, and a sizable chunk of change that could be put towards a down payment if it weren’t being direct debited to a landlord. Along with first time homebuyer assistance programs and other reduced down payment options, a year or two of living at home could very well translate into a millennial purchasing their first home.
Most parents seem to understand this, too—since the majority (64 percent, according to a 2017 Bank of America report) don’t actually charge their adult children living at home for rent or monthly bills to live with them.
Take it From Those Who’ve Done it
A recent article from USA Today reached out to a few millennials (ranging in age from 23 to 34) who shared their personal experiences living at home and saving up. Twenty-three-year-old Katie Powers, for example, moved back home rent-free after graduating in 2016, and in about a year was able to save up $25,000—and that’s on a salary of $32,000, with help from a part-time job, too. She told USA Today that she planned to stay at home for another year to reach $50,000 so she would have enough for a 20 percent down payment on a home in the $200,000 to 250,000 range. (You can read more about her story—and the others profiled—here).
So, maybe it’s not what you’ve been led to believe after all — millennials aren’t living at home because they’re lazy, they’re doing it because it makes a ton of financial sense.