Parents as Roommates

What to do when your parents are your roommates

When graduation looms, it’s time to make some big decisions. What’s your next step? Where are you going to live? What are you going to do with your life?

For many new grads, the best answer to the first two questions is, “I’m going to move back home with my parents for a while.”

And for some, this will feel like the end of the world. But it’s not!

You’re just giving yourself the space—and breathing room—you need to make the right decisions about your future.

The trick is to set some guidelines for yourself.

Make sure you know why you’re moving home

What you are trying to achieve by moving home?

If you’re using the time to “get back on your feet,” define what that phrase means to you.

Are you moving back home to help you as you start the relocation process? Are you job searching and need additional time? Are you doing it to get your finances in order for a large purchase associated with a big move?

Whatever the case may be, make sure you have a set plan with a measurable and realistic goal—preferably one you can share with your family so you can stay on track.

Give yourself a time limit

Your time at home should have a shelf life.

Make this one of your top priorities. Make a plan for what you need to accomplish and how much you need to save to reach your goal of moving out.

Without a plan or a deadline, you may be setting yourself up for an “anything goes” mentality, which can make it harder to move out and stay on top of your expenses.

Get a handle on your student loans

Find out how many student loans you have, how much you owe back, and what the interest associated with each of them.

If you think you may struggle to make payments, look into your options. You are automatically enrolled in the 10-year standard repayment plan by default, but most lenders have other plans available. Call yours to discuss repayment plans that can work more realistically with your salary (and not just because you want to maintain a habit of spending more than you can afford every month).

Establish a budget

Your income is probably very much in flux, but do yourself a favor and make a post-move out budget now.

First, calculate what your net worth is. What assets can you pull from? What money do you have coming in? How much money do you have to spend each month?

Then figure out how much your student loan repayments are going to be and start putting that away. Get a handle on what the rest of your expenses will look like after you move out, too.

That way, you’ll be prepared when the bills start rolling in—and able to enjoy your post-graduation life.

Plan for your future

One of the upsides of moving back home is that you are buying yourself time.

Use it to create some hypothetical budgets for the long-term living situation you want. Use this salary calculator to help you out.

If you have options on where you can move, browse the cost of living in each place, assess levels of convenience to places like grocery stores, restaurants, and public transportation between where you want to live and work.

Do some research to find out and what your expenses will look like overall if you rent or buy a home in a certain place and what your spending situation might look like there, and places where you can save money to keep in your budget.

While you’re figuring it all out, start finding ways early to become more financial independent and less reliant on your parents, even while you may be living under their roof.

Cut yourself some slack

After graduation, everything is up in the air. Not just your financial situation, but your social life, your work schedule, and your regular routine are likely to change a number of times before you get in your post-grad life groove.

So, give yourself some flexibility, but be smart and consider all your options. Maybe moving back in with your parents will be one of the more moneysmart moves you ever make.