If your adult kids have moved back home (or never left), should you be charging them rent? And if so, how much?
Those were the questions asked of more than 1,000 Aussies, and the answers may surprise you.
Aussies believe adult kids should pay the price for living at home and should be charged $153.39 per week, the survey from Compare the Market found. That works out to about $7,800 per year.
Also read: 4 easy ways Aussie renters can save money
Compare the Market’s Chris Ford said $150 was very competitive considering the extra costs for food, electricity, water and internet that come on top of rent.
“The median cost to rent a unit in Australia is $540 a week, so $150 could be a happy medium for the adult child as well as Mum and Dad,” he said.
Ford said the pandemic and the rising cost of fuel, gas, electricity and groceries had made it harder for younger people to save money, forcing some to move back in with their parents.
“It can be mutually beneficial – the adult child gets to save some hard-earned cash while the ‘Bank of Mum and Dad’ can have some financial support to cover seemingly ever-increasing household bills,” he said.
‘Bank of Mum and Dad’
For parents who want to help their kids get onto the property market, Ford suggested putting the rent money into a savings account or investing it.
“Eventually, after they claw back some cash and are looking to move out again, you can help them with the money you have put aside for their future,” he said.
Ford recommended not telling your kids about your “good deed” until they planned to move out.
“If you tell them you’re putting money aside for them, they might not bother saving any of their own money,” he said.
How much should you charge?
Assess you and your child’s financial situation and decide on a fair amount, Ford said. Remember to factor in any increases to your household, including energy bills or grocery bills.
Also, agree whether they will need to chip in for any extra costs such as internet or food, or whether the rent amount includes everything.
Lastly, work out how you’ll divvy up chores and whether it will be a mandatory condition for them if they return home. Ford suggested creating a chores roster or allocating certain tasks to them.