Even though the recession officially ended seven years ago, a housing trend seen during the downturn has endured: The number of multigenerational homes continues to grow.
A record 60.6 million people, or 19 percent of the American population, lived with multiple generations under one roof in 2014, according to a new Pew Research Center analysis of federal census data. That compares with 17 percent in 2009, the year the recession ended, and 18 percent three years later, in 2012.
Pew defines a multigenerational household as one that includes two or more adult generations — say, baby boomer parents and their adult children — or one that includes grandparents and grandchildren.
The share of households with multiple adult generations has been growing since hitting a low of 12 percent in 1980. The trend greatly accelerated during the 2007-9 recession, when high unemployment pushed younger people, in particular, back home to live with their parents. The question was whether the trend would ease, as the economic recovery made it more feasible for people to strike out on their own. So far, the shift shows no sign of abating.
“The striking thing is that this really has persisted after the recession,” said D’Vera Cohn, a senior writer and editor at Pew Research Center. “Perhaps this trend is here to stay.”
There are many economic benefits to living with parents or grandparents as an adult, Ms. Cohn said: If you’ve lost a job, moving in with family keeps a roof over your head and helps keep you out of poverty, and those with student debt can pay down loans more easily. “All of those things are still true,” she added.
Another possible reason for the trend, Pew’s report noted, is that the Asian and Hispanic population is growing more rapidly than the white population, and those groups are more likely to live in multigenerational households.
John L. Graham, professor emeritus at the business school at the University of California, Irvine, and co-author of “All in the Family: A Practical Guide to Successful Multigenerational Living,” said he saw the trend as part of a return to interdependence within the extended family. “This is the way people have always lived around the world,” he said.
The economic benefits of sharing services can be substantial, Mr. Graham said: Grandparents and older family members can provide child care, while younger adults can care for elderly relatives. Travel costs are reduced, as members don’t have to pay for gas or airfare to visit. “There’s a saving,” he said, “ in having the family close by.”
But living in a multigenerational household also means getting used to sharing financial responsibilities. Financial planners advise that families talk early and often about who will pay for what, and what everyone’s expectations are, regardless of whether the shared household results from economic need or simply a desire to have family members nearby.
“Everybody needs to start with a candid and open discussion about the money,” said Dave O’Brien, a financial adviser with Evolution Advisers near Richmond, Va.
Sometimes, a grandparent who is financially sound may feel inclined to pay for groceries or dinners out — even though his or her adult children are capable of paying their own way. The grandparent could help in other ways, he suggested, such as by arranging activities with grandchildren.
Lauren Locker, a financial planner in Little Falls, N.J., said that if younger family members are having financial difficulties and can’t afford to pay much toward rent or utilities, the arrangement can still work, with the younger participants providing services — keeping up the yard, for example, or cooking meals — in lieu of cash. “The parents can say: ‘You don’t need to pay me, but you have to do A, B and C. Does that work for you?’”
Here are some questions and answers about multigenerational living:
What is the best way to manage costs in a multigenerational household?
Ms. Locker suggests holding family meetings monthly, or at least quarterly, to go over budgets and air any concerns. Budgeting tools like Mint.com or Quicken can help families analyze costs to make sure bills are equitably allocated.
Jean Setzfand, senior vice president of programs at AARP, says sharing a household can have a financial downside, if parents delay saving for their own retirement to cover costs of other family members. While unrelated roommates don’t hesitate to divide household costs, she said, family members “tend to see the money situation more loosely, since ‘we’re all related.’”
She suggests that household members make a list of regular expenses, like the mortgage and utilities, and clearly agree on what share everyone will pay. “Forget those familial ties,” she said, at least while talking about the budget.
How can families maintain some privacy in a multigenerational household?
A loss of privacy is the main drawback when multiple generations live together, Mr. Graham said. Having separate entrances and kitchens for different wings of the house can ease that problem, he said; families considering moving in together should seek a home with those features.
Some states, like California, are debating changes in building and zoning codes to allow for accessory structures or studios, also known as “granny flats,” to allow family members to live close to one another, but with a bit of space between them.
Where can I find information about managing multigenerational living?
Generations United, a nonprofit group, offers a tip sheet on its website, www.gu.org.