As a Gen-Xer, I’ve seen much of this phenomenon — grown children moving back in to their parent’s home due to financial struggles — among my fellow Gen-Xers, as well as a fair number of older Millenials.
But it’s a telling sign that the US economy is not doing so well when younger Baby Boomers are faced with having to do so, as well.
The case of Ann Bauer is telling: Her job, “an events planner at an upscale resort,” is dependent on the discretionary spending of well-off customers — or at least, middle-class folk with “mad money” to spend on luxuries. But in a tight economy, that demand drops big time, and, thus, her job as well.
In addition, she didn’t have a college degree. So being laid off was pretty much a death-knell to the level of income that she was accustomed to and the cause of her series of “several lower-paying jobs”. Most likely, these jobs did not pay the debts that she accrued and the standard of living that she was used to when she was a middle-class events planner, catering to upper-class clientel, leading to her eventual declaration of bankruptcy.
Finally, her divorce, which happened a year before being laid off, already made her financially vulnerable. As with most female Baby Boomers who divorce, she likely was trying to hold on to her house and quality of life, even though her household income was reduced to at least 50%, what with the loss of her husband’s income.
All of these life events — divorced, laid off, no college degree, insurmountalbe debts — became ingredients for a 52-year old woman to move back in with her 80-something year old parents, at their behest. And, as the saying goes, not looking a gift-horse in the mouth, Bauer swallowed her pride and accepted the financial lifeboat that her parents offered her. “[Y]ou take humble steps in order to move forward,” she explains to those who shudder at the idea of moving back to one’s childhood home.
My own family has experienced this as well, although not with a Baby Boomer. My Gen-Xer sister moved back in with my parents after her divorce last fall because 1) she was under incredible amounts of debt due to her deadbeat ex-husband, and 2) her house, trashed by said ex, was de facto unlivable. My parents paid for her lawyer and then paid to reconstruct the house. They also helped out to pay some of that debt-load, since, unfortunately, the accounts were in my sister’s name, even though it was her ex who ran up the balances.
Fortunately, she’s been able to move back into her house this spring, albeit cancelling her cable, Internet service, and land-line in order to keep up with her basic utilites, mortgage, and minimum payments on the credit cards. Unfortunately, my parents stretched themselves financially too thin, helping out my sister, hence my mother’s sheepish call a couple of weeks ago, asking me if I could lend them money to help them keep afloat for March.
It felt really weird, assuring my mom and dad not to feel guilty that they were asking me for money. Just as they helped out my sister because she was in trouble, why would I not do the same for my own parents?
Better me than another high-interest loan — like credit cards — to pay off necessities, which gets people into trouble in the first place. Like Ann Bauer.