Kids starting job... living at home ... how much "rent" should they pay?

Clamball said:
I would be inclined to the 35% of take home pay. While it is wonderful for adult children to live at home with very little responsibility in terms of food, cleaning, washing, utilities etc., there is a significant impact on the household.

I would use the money to:
Do household improvements, all that wear and tear from the 20 odd years of kids, breakages, making do, buying low quality because that was all you could afford.
Improve the quality of food in the groceries.
Get the more luxurious shampoos, soaps etc.
Leave the heating on for longer than normal.
All those jobs you have been putting off for years because you were shelling out money for extras and education for the kids.

Spending this way improves the lives of all in the household. If you still have a mortgage pay it off faster.

And it focused the mind of the adult kid - do they want to continue to live at home or move out to spend their money as they wish. My adult kids are either still in education or living out of home so this is all theoretical on my side. I might think differently when it actually happens. But I did have a friend who paid 50 % of take home pay to live at home.
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Sound advice. There have been multiple posts on AAM by parents solving all their children's problems and bankrolling their lifestyles, storing up future practical and mental health problems for them in the process.
 
Gordon Gekko said:
Happy New Year.

Firstly, it’s great that they’re both doing well.

There’ll be different opinions on this. My own is that they should definitely pay something, and that the higher earner should pay more.

Then there’s the question of how much and also what you do with the cash. Their ‘take homes’ will be €48,000 a year and €29,000 a year according to the Deloitte tax calculator. To put it in context, that’s basically €4,000 a month of disposable income for your son. Very few people would have that after their other commitments are taken care of.

As an aside, you should advise your son to start funding his pension to the max, i.e. 15% of €71,000 per year (I’m assuming he’s not Van Wilder). The impact of starting so young should be huge. It sounds like your daughter is joining the public sector, so she should familiarise herself with that system.

Personally, I would ask him for €1,000 a month and her for €500 a month. But I’d actually set the money aside as their own (without their knowledge) and then give it back to then when they’re buying a property. I would actively encourage them to start saving for deposits as well. There would be no tax issues; just document it in simple terms on a one pager, i.e. that it’s their money.

Living at home for €1,000 a month and sticking a net circa €500 into his pension, he should still be able to save €1,000 a month pretty easily.
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It sounds like your daughter is joining the public sector, so she should familiarise herself with that system.

That's correct @Gordon Gekko That's where she's hoping to get a job. I'm not familiar at all with the Public Sector pension. Is there something she should be looking at? Thanks!
 
I'd look for 25% of monthly net pay with a floor of €350 (and perhaps a ceiling of €1000). No question about it, something need to be handed up. There has to be an incentive to move out.
 
Of course you should be charging them rent. I suspect they may have full board including extras, toiletries, maybe even the use of the family car at times etc so this may not be compared to basic rent and I don't understand the idea of returning it to them when they leave. By all means I would be in favour of giving them a leg up when they move into their own place and have done this for all of them.
You won't believe the difference in the general household bills when they're gone and you'll find yourselves starting all over again to live your new lifestyle
 
Interesting to see the different opinions and methods of calculation.
Our eldest is in his second year working. He tells us most of his peers are paying less than him, if anything.
As a point of principle, we want him to pay something, but still be able to save. We asked for €300 for his first year working. The plan is to increase it every year - but stay below market rate. He's currently paying €400. He tells his younger brothers he's paying 'rent'.
 
noproblem said:
Who made the decision they were going to live at home, and why?
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It was my son @noproblem who brought it up.

He mentioned one of his friends is paying €800 per month and he also mentioned another friend who has a car loan repayment and rent coming out of his account a few days after he gets paid and when these are taken, he has less than half his salary left. Both of these lads are from Dublin and my son didn't see the point in doing this, particularly if they're trying to save for their own place. We (my wife and I) said that we have no problem with him living at "home" when he starts working, but he'll have to contribute. I'm just trying to see how much others, who are in a similar position to me, are getting from their kids.
 
Could you calculate the cost of running the home, eg utilities, mortgage, any food they use? Or estimate how much you could get renting the room under the same conditions to arrive at a figure ?
 
Black Sheep said:
Of course you should be charging them rent. I suspect they may have full board including extras, toiletries, maybe even the use of the family car at times etc so this may not be compared to basic rent and I don't understand the idea of returning it to them when they leave. By all means I would be in favour of giving them a leg up when they move into their own place and have done this for all of them.
You won't believe the difference in the general household bills when they're gone and you'll find yourselves starting all over again to live your new lifestyle
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You're correct @Black Sheep. Both have full board with all the "trimmings" e.g. laundry, TV, broadband.

My son has his own car (it's a 15 year old banger. He paid his insurance in October with the money he earned while doing his placement). That was "unexpected", so I totally get your final point re the difference in bills!

My daughter is learning to drive in family car (failed her test a few weeks before Christmas, so there'll be more money spent on pre-test lessons :()
 
POC said:
He tells us most of his peers are paying less than him, if anything.
As a point of principle, we want him to pay something, but still be able to save. We asked for €300 for his first year working. The plan is to increase it every year - but stay below market rate. He's currently paying €400. He tells his younger brothers he's paying 'rent'.
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I would get the same argument from my kids, that their friends would pay nothing living at home, so I would be be ready with my point of view first
- need to make a contribution to the household expenses if living at home
- perfectly happy for them to move out if they don’t want to contribute
I think keeping the emotion out of it, being very matter of fact, that why would an adult not contribute to a household where they are living if they are earning. It can be a wired transition going from a dependant to a contributor, but none of us get to use all our wages for leisure activities or savings.
 
It will be interesting when your son and daughter bring their partners, friends, etc, back to YOUR house. If and when they do start to pay for their "stay", have rules, or you'll very quickly, with your wife, become the tenant. All good and well the parents helping out grown up offspring (not children anymore) with saving for deposits, but be careful it doesn't get too comfortable for them. I'm all for helping out, in almost every way. However, this is a road I would be reluctant to go down, and always have been for many, many reasons. My children always knew this, they're grown up now, with their own kids, and I well know the toll it takes to mind them all over long holiday weekends, like Xmas, Easter and bank holiday w'kends too. It seldom occurs to them that those nice free days might be the time we ourselves might wish to spend away from it all. Am I selfish? Not a bit. Impossible to calculate what we gave up to sometimes enjoy those days. Do what you have to GER1966, but be careful and sensible about it.
 
misemoi said:
Could you calculate the cost of running the home, eg utilities, mortgage, any food they use? Or estimate how much you could get renting the room under the same conditions to arrive at a figure ?
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Food is certainly expensive @misemoi. At one stage, I counted 5 different types of milk in the fridge .... "full fat", "low fat", vanilla, oat and soya - with the last 3 being over €2 per litre :eek:. I've noticed too that the food bill jumps a lot when child #3 goes grocery shopping with my wife. We make a conscious decision now that only my wife does the weekly grocery shop.
 
noproblem said:
It will be interesting when your son and daughter bring their partners, friends, etc, back to YOUR house. If and when they do start to pay for their "stay", have rules, or you'll very quickly, with your wife, become the tenant. All good and well the parents helping out grown up offspring (not children anymore) with saving for deposits, but be careful it doesn't get too comfortable for them. I'm all for helping out, in almost every way. However, this is a road I would be reluctant to go down, and always have been for many, many reasons. My children always knew this, they're grown up now, with their own kids, and I well know the toll it takes to mind them all over long holiday weekends, like Xmas, Easter and bank holiday w'kends too. It seldom occurs to them that those nice free days might be the time we ourselves might wish to spend away from it all. Am I selfish? Not a bit. Impossible to calculate what we gave up to sometimes enjoy those days. Do what you have to GER1966, but be careful and sensible about it.
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Excellent point @noproblem.

While I'm not a grandad yet - and hopefully won't be for a while!! - I have older brothers and sisters who are, and I see them being called on to mind the grandchildren on bank holiday weekends so their children can have a "break". Unfortunately, their kids don't consider that their own parents might have plans for those same weekends.

My wife has suggested that we down-size to a smaller house once child #3 gets sorted and use some of the proceeds to buy a one bedroom apartment in Spain or France and spend 6 months of the year there.
 
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If he can rent in Dublin for 800 why the hell would be want to live at home and pay 1000 or 35% of nett pay?! Will you and the wife let me bring home girls or fella if that's his thing, after nights out? Will you allow your daughter to bring back a lad if she wanted???

Seriously, do you want to treat your children as tenants or do you as your loved ones. Charge them a nominal amount, 250 or 300 and let them enjoy life, have experiences, travel, and save for a house.

Remember you can rent-a-room for €14,000 max a year. Any higher than that and you'll pay 50% tax on everything received. I'm not wealthy but before I'd charge my children rent that is being proposed here when they get to working age. Instead, I'll give them advice and guidance. I'd imagine they will need help and assistance when they get to that age in 20+ years time than me taking money off them when my mortgage in all likelihood will be paid and I'll be nearly 60!
 
The point has been made previously that there’s a difference between rent and “full board”.

We’re talking about an adult earning €71,000 a year and living with his parents. Free board, free utilities, free food.

I genuinely think €1,000 a month is about right, but I would give him the money back when he’s buying a place.

As for having “guests”, I’d go with my own experience; I wasn’t allowed to bring randomers back but longer term girlfriends were fine.
 
PebbleBeach2020 said:
Remember you can rent-a-room for €14,000 max a year.
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That's €1,166.67 per month - exclusively for rent, it didn't include food, contribution to light and heat, TV, broadband, laundry etc. All of those perks are very likely to be included, when adult kids live with their parents. Renting at €800 pm also doesn't include all of those benefits, I'd bet.

If someone is earning, they need to pay their way... Even if its at a discounted level, to what it would cost them, if they lived away from home.
 
Gordon Gekko said:
As for having “guests”, I’d go with my own experience; I wasn’t allowed to bring randomers back but longer term girlfriends were fine.
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While that sounds about right, things have changed a lot, since we were all young, so what seems reasonable to our age group, might be completely unreasonable to the 20 somethings. Remember, they've got Tinder etc. ;)
 
I think that the most important thing, and especially in the context of a site like AAM, is teaching kids of all ages that money doesn’t grow on trees.
 
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