Why You Should Charge Adult Children Rent

Smart Money Debate Blue

Welcome to the 8th Smart Money Debate at ReadyForZero! To see the other side of this debate, read Melissa’s post: Why You Should NOT Charge Adult Children Rent. And then let us know which argument was more convincing!

This post was written by Jana, author of the wonderful personal finance blog Daily Money Shot, where she discusses money, family, relationships, pop culture, and everything in-between. You can also find her on Twitter and Facebook.

Why You Should Charge Adult Children RentAsking a child to pay rent upon moving back home is undesirable, yet necessary. As a parent, it is hard for me to think about ever asking my child to pay to live in her own home. While she’s a child, that is. But if she’s finished college, has a job and simply wants to move back home because it’s easier, I can’t think how giving her a free ride would be at all beneficial to her in the long run. It wouldn’t make sense.

In fact, my husband and I have talked about this topic (granted, our child is almost 6 but why not discuss something that may or may not ever happen) and what we would do if our daughter came to us wanting to move back home. We’ve decided that we’d absolutely charge her rent. Maybe not the rent she’d pay living on her own in an apartment, but she would pay something. And here’s why:

Decreases parental dependency

Living rent-free in your parents’ house is a surefire way to continue to be dependent upon your parents. You rely on them for all the same things you did as a kid—a roof, food, utilities. Maybe not food or gas. But one guy I knew even had his mother still doing his laundry and packing his lunch for work every day! He came to rely on his parents so much that he actually didn’t know how to do much for himself.

Being dependent on your parents is not a great way to become an adult. By paying rent, that helps to break the dependency cycle and makes the adult child contribute to the household. Then he’ll feel like he has a stake in what happens and may step up and take charge of other areas of his life (additionally, the parents have to say no to performing these types of tasks in order for the dependency cycle to be fully broken).

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Encourages smart financial choices

And to cut frivolous spending. Many of the adult children I’ve known living rent free in their parents’ homes wasted money. Every meal was purchased. New DVDs every Tuesday. Every weekend at bars and clubs. New clothes, expensive cars, and yet, they complained about never having any money and not being able to move out of mommy’s house because rent is too expensive.

Had their parents asked them to pay rent, they’d cut back on much of the unnecessary spending and get a hold on how to pay their bills. Then they’d be able to move out on their own, making them more independent and responsible for their own financial choices.

Encourages responsibility

It’s hard to separate this one from making smart financial choices because really, they go together. When you mandate your child to pay rent—no matter how high or low—you are giving them a tool to learn how to be responsible for their money.

Paying rent is just like paying another bill and part of being a responsible adult is paying your bills and doing so on time. And, just as in real life, there needs to be consequences for late payments. Whether that’s a late fee or interest or something else is up to the landlord (read: parents) but a child will never learn to be responsible for his or her money if there’s no reason to be.

Just so you don’t think I’m completely heartless, there are two exceptions I’ll concede:

  • If the parent and child discuss logistics ahead of time, and the child is moving back home to pay off debt or save money for something big (like a house or graduate school or wedding), then not asking the child to pay rent is totally acceptable. However, it must be agreed upon by both parties and there must be some sort of tangible proof that the money is going towards the stated goal and not towards enhancing a wardrobe or an incessant need to buy electronics. I’ve seen this type of arrangement in action and it really does work.
  • If the child can’t find a job. If there’s no job, there’s no income and therefore cannot pay rent. However, if that’s the case, the parents must step in and make the child contribute to the household in some way. Whether that is doing housework or running errands or cooking meals, the child needs to be more than a lump on the couch.

As much as I’d like to say I’d be one of those cool moms who’d let my baby move back home with me and live rent free until she gets her finances in order, I know that I can’t be. Doing so is a detriment to her in the present and in the future.

Besides, knowing me, I’d put the rent money in a savings account and give it to her on her moving out day.

What about you? Share your opinion in the comments below.

To see the other side of this debate, read Melissa’s post: Why You Should NOT Charge Adult Children Rent. And then let us know which argument was more convincing!

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  • I would not charge my child rent, unless he is really crashing at my house like it is a hotel and I have to do laundry and feed his girlfriend. I come back in between houses and stay with my mum, and don’t pay rent or food. I cook for myself, clean, and the last time even painted her living room. But she is doing well financially and money she doesn’t spend now will be my inheritance, taxed at 50% by the government. I’d rather enjoy it now. That said, I think the most I have stayed was two months at a time.

    • That’s an interesting point about taxes. If you were to pay your rent to your mother and then gave it back to you later as a gift or an inheritance, it might be taxed twice.

      • Actually my mum even gets a tax credit for adult children living at home. It is not much, about $500 off tax per year, but about covers what I use in extra utilities.

        • Wow, I hadn’t thought about that. I guess that’s even another reason why it makes sense for her.

        • john fogleman

          I have a step daughter she moved in with us in Fla from Texas. I have asked for rent 40.00 a week no go even her mother will not let me charge. instead she buys drugs stays out all night attacks me nd tears up the house when I stop her from eating food she cant help or pay for. can I get a judge to help me override her the mother and tell here to pay are move out. robertclearview@yahoo.com

  • Bob

    I think it depends on your relationship with your parents. I’m in a situation now where I’m falling apart financially after college. I asked my mom if I could move back in, and she acted as if I was just annoying her and asked if I could pay rent. Big guilt trip. Being the kid that needs help I ask: Why live with your parents and pay rent if you could live alone or with a stranger and do the same? Maybe living with your parents is nicer for some, but historically In my situation it hasn’t been. I thought I could ask for help and I couldn’t. I don’t feel like I have a family anymore.

    • Hi Bob, I’m sorry to hear about that – it must be frustrating! I agree that if things are financially precarious for the son or daughter, it makes sense to try to save money by living at home. And if the parents can let them stay for a time, that is ideal. Of course, I understand that sometimes there won’t be room in the house or the parents themselves will be struggling financially in which case providing free rent might not be feasible. But in cases where it is feasible, it makes sense to me. Anyway, I wish you the best of luck in dealing with this situation.

  • cc

    I’m pretty late to this discussion but I had my first job for over 4 years and having no children allowed me to work all the OT they offered. I was/am still living with my parents. (very fortunate) however I did have a car payment/insurance/gas, cell phone bill,and numerous hospital bills. So after all my bills were paid every month my priority was to save every penny I could. I opened a second account to have a small amount transferred to earn interest (to quickly save a fair amount for nursing school) I bought my own groceries,toiletries,clothes..you name it. I never once asked for a handout or expected anything. If I needed it I bought it. Unfortunately I was let go and unemployed for close to three months. Keep in mind I saved a pretty decent amount to sustain myself for a few months. I literally ate rice and beans and hardly left the house to save gas. My step dad after my job loss asked me to pay the electric bill, he said I could pay $200 and whatever is left he’ll pay. And that I should fight my unemployment because he needs help with his bills. I was BLOWN AWAY to say the least. I have my own bills to worry about with no income stream. I am grateful to have somewhere to live rent free but I busted my ass to save for school to earn a degree to be able to move out and live my own life. My other 2 sisters (step,so different grandparents) did nothing like that,both moved out right away and were always getting hand out from my step dads parents. And yet he says I have to pay to help him. I can’t see his reasoning any way I look at it. In the few months I was unemployed my account came extremely close to $0 and my savings for school was gone. And that school money went to his electric bill. Ive been at my new job for 9 days and he already wants me to pick up the bill again. I just can’t help but think what if I didn’t live here,who would you bully to pay your bills then? I would love a place of my own but my money is tied up in bills and saving for school. Rant over,it is just so incredibly frustrating!!!

  • Joe

    I have a problem. My parents are going to be kicking me out soon,because I don’t pay rent. I’m 19, graduated school about 4 months ago, and have no job. I used to have one but quit because they were only giving me 4 hours a week. They we’re also mistreating me and I thought $25 a week wasn’t worth it. But my parents, mostly mother, calls me names and makes fun of me. She says I’m an embarrassment, I’m a scumbag, retard, bum, and many other things. She screams at me everyday yelling at me to get a job because I’m a free loader, and If she catches me sleeping when she gets home from work at 9am. I have been looking, and tried to get one but nothing yet. I just wanted a little bit to relax and get my bearings on what I want to do. But they won’t let me have any slack. Am I wrong in this?

    • Hi Joe, I’m really sorry to hear that. No mother should call her son names like that. I’m sure you don’t deserve that kind of treatment, and it must be very hard to deal with. Personally, I don’t see anything wrong with a 19 year old taking a few months to find a job. In fact, it seems pretty natural to me.

      With that said, it sounds like your parents are not going to support you in this, which means you’ll have to make other arrangements. Hopefully you have someone else in your life that can help you during this difficult time.

      Either way, be sure to check what other resources are available. This blog post might help: http://readyforzero.wpengine.com/what-happens-if-i-lose-my-job/. I’m sure things will sort themselves out eventually. Good luck!

    • Been There

      Sometimes parents don’t know how to deal with their own worry that their kids aren’t being functional. I’ll bet your mom doesn’t mean what she is saying, but she is losing her temper out of frustration and worry. Buck up! No one gets a free ride, as she knows when she returns tired from work and sees you “relaxing”. She may have her own financial concerns. You aren’t a kid any more. She does not want you to fail at life, and “freeloading” isn’t cool. The food you are eating as a young adult is being paid for by her. You can do that for yourself. Get some kind of job while you are deciding what to do next. Then try to find schooling or apprentice work that will take you to the next level. You will feel so much better about yourself!

      • Robin Wenz

        Amen. You could be cooking and cleaning, helping around the house until you find a job. Parent’s shouldn’t have to ask you to help. You should feel responsible enough to help and just do it. Show appreciation while you are struggling, too. That’s what I would want for my son to do.

    • elliottdoland

      I know parents like that. One of these days they will need your help…..and you will be totally justified in turning your back on them…..and be sure to let them know why.

    • Robin Wenz

      Go door to door, mow lawns, weed, trim trees/shrubs, help around other people’s homes, walk dogs, house watch etc. There are plenty of jobs that are low income to start and you can move up the ladder (McDonalds, Wendys, Rite Aid, banks). There will never be jobs unless you are proactive daily. No one said it would be easy. It’s tiring and exhausting reapplying over and over. You aren’t disabled, so there are more opportunities out there. You could even be a dispatcher, operator, Home Depot Sales or Stocker. You must not be looking in the right places.

  • Zenquest

    My family was solidly middle class, and in order to return to college each year I had to work in factories in the summers to earn enough money for the part of my tuition my scholarship did not pay. Prior to college, I worked part time and baby sat. Senior year in high school, I waited tables and worked in a music store, two part-time jobs while still in school. I learned a lot through these efforts. Primarily, I learned the jobs I did not want to hold (dangerous, toxic ones in the factories). It is amazing the motivation to succeed this creates. My parents expected me to grow up and figure out how to move on with life. They wanted me to be able to be independent. Both of my brothers and I took loans for graduate/ medical school and paid them back. Self respect and confidence were gained through this. Many kids today seem to think their parents should care for them post-college when they are fully functional adults. This neither serves the “child” (really?) nor the parent, as the parents may well have debts they need to resolve to prepare for retirement or for caring for aging parents who really do need their help. No, you probably won’t make that much money when first on your own, so use that as a motivation to TRY harder to improve your situation. Get roommates and grow up! And if your parents paid for your college, perhaps you should think about what you owe them, not the other way around.

    • Ashley Slack

      Right on. Well said.

    • Robin Wenz

      You sound just like me. I think some people are just more motivated than others to live on their own. My parents kicked me out before high school over a fight. My sisters were not doing their chores so my mom was pushing them on me, besides my chores. I finally voiced the unfairness instead of being quiet as a mouse, and I got kicked out before I graduated.

      I lived in my car a few weeks, worked 2 jobs and got grants, scholarships for college. My boyfriend’s mom took me in and then I helped her, too, around her house on my free time.

      I ended up marrying her son and we were able to just barely afford an apartment. Eventually I got a half decent job and divorced my first husband because he didn’t feel it was necessary to work and help out with our struggles for daily living.

      I have all the degrees AA, BS, MA etc (not so lucky to go to medical thanks to crappy genetics/memory and learning issues), and yet I struggled but persevered. BUT, i learned to advocate for myself, get help, find help, where there’s a will there’s a way attitude.

      Grants and scholarships paid for my education (some cash from 2 jobs, too), low income mortgages bought me a newly built town home at age 22. Anytime there was a grant or help for low income, I used it to my advantage. I am disabled, so getting a good paying job is always a struggle. I am proud to be out on my own and rarely relied on outside parental help. The last thing I wanted to do was ask people who tossed me on the streets to help me. I grew up fast. It wasn’t pleasant, but it was doable.
      I learned to be responsible and appreciate what I had.

      It is not easy pushing responsibility on a child that might unknowingly have genetic issues (ex Autism, mitochondria, methylation issues) that affect behavior and understanding. Some tests have confirmed some issues. At the same time, what parents wants their kid home forever when they fight to do the stupidest chores? Very complicated! What to do?

  • elliottdoland

    My mother charged me exorbitant rent when I graduated high school, even though I was not yet of age and legally able to get my own place. Times were tough as a new high school graduate. When she was old and feeble she wanted to move in with me free of charge. I told her to find a nursing home and leave me the hell alone. What’s fair for the gander is fair for the goose.

  • Kristie

    I’ve been helping around the house and am also trying to pay down loans and save, but I just now had to start paying rent at my parents’ house because it’s not enough. They’ve gotten greedy and obsessive over money, and now that my mom quit her job I have to pick up the slack for them. Not at all fair, but I’m doing it because I can’t actually live in my car.

    • Kristie

      And what really gets to me is that my parents have no issue with my 21 year old brother Irving upstairs on his computer 24/7. He contributes nothing and nothing is ever asked of him. He has no job, no education, nothing. I don’t get it.

  • Ashley Slack

    I think we live in a very entitled world right now. Parents, rather than putting your kids up in your home (whether they are paying rent or not) have honest conversations with them from the beginning about what their options and job prospects will be realistically upon graduating from college. My job prospects were limited with my Bachelor’s degree in Psychology, but I still made it work without moving back in with my parents. There are always ways to cut back on your spending and expenses. People simply don’t want to do what is right. They want to do what is easier. Even allowing your children to move back in with you to save money pursuing a graduate degree, saving for a wedding, etc. is enabling and codependent behavior. If you are taking these steps in your life and still need to live at home, then you are not financially prepared for these steps and should not be taking them.

  • Mark Jackson

    If you do charge rent, make sure you declare it to the IRS. Otherwise, you’re breaking the law. You may never get caught, but it’s still the law.

  • Jhart

    I have a 19 year old step son and he has never moved out, never plans to, in fact I see the movie step brothers in my future!! He is working part time now but can’t hold a job and spends his money on the stupidest stuff. He is disrespectful and does not buy his own food, ests my young daughters school snacks and leaves the trash all over his room. He won’t do the ,2 chores we gave him, cut the grass and trash. I can’t do it all because of back surgery. I want him gone but I just don’t think he would make it. Esp not on 600 month income. So, with that said how much is a good amount to start with for rent? And I love the idea of a significant increase after 12 months! Thanks Jenn