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So in light of the current economic situation, I've been doing some thinking.
I am 24, currently rent an apartment, live alone, have a decent (stable) job and I am single. I live approximately 10-15 minutes away from my parents.
My parents aren't particularly well off (part of the struggling middle class) and helped send me to college (paying half), ending up with about $35k in parent-student loans. They have very little in the way of retirement savings, so to be blunt, they'll basically have to work until they die.
So I am considering moving back in with them, temporarily (approximately 2 years). I have a couple of reasons for this:
1. Rapidly pay off their portion of my student loans. Converting my rent and discretionary funds to loan repayments funds.
2. Income buffer. If either one of my parents lost their jobs, they'd be in some serious financial trouble within a short period of time. My dad has been laid off twice, and has high ethical standards which has caused him to lose his job when he wouldn't participate in unethical behaviors (he's in sales, currently car sales). My mom is getting burnt out working as the administrative assistant for their church, doing the work of 3 people (spending nights and weekends doing work at home or at the church) for just a few dollars over minimum wage.
I have a couple of concerns with it though as well:
1. How would my added income (loan repayments) affect their taxes? Would it be seen as a gift, and be limited as such?
2. How would the situation be perceived in my dating life? I already know any 'bedroom' time would take a hit, but I'm not supremely active anyway...
I am no tax expert, but if you are making payments directly to the loanholder, I don't see how it would affect your parents' taxes.
Well it won't help your dating life any. If I met a guy who did this, I'd think it was great, really sweet...but in the back of my head, I'd be worried you planned on living at home forever.
2. How would the situation be perceived in my dating life? I already know any 'bedroom' time would take a hit, but I'm not supremely active anyway...
Find a girl with her own apartment and no roommates, don't tell her about the whole living with parents thing until she is in too deep. Always insist on going to her place.
Im kind of in a similar reverse situation. My 24 yr old son moved in with me this past April. I was recently seperated and served with divorce papers after just purchasing a new house. So now have twice the expenses and half the income. My son was renting an apt. and working out of town most of the time so we decided it would be to both our advantages for him to move in with me. It does not seem to affect his love life. Like you, he didnt go out all tha much anyway. Of course I would have no problem with him havint "sleepovers".
I dont see how your parents taxes would be affected. My son pays a bill for me that is equivlent to what his rent was. Im sure not going to claim it on my taxes as income.
First off, I find it very considerate of you to help your parents out this way. Tax wise, if the payments are made as rent, they'll have to list it as income on their taxes. The way around it is to consider it your upkeep, that is paying your portion of living expenses. I'd consider your paying the loan as part of this and if you pay more, it can go towards the food you eat and a portion of the utilities. I'll admit that we have a son living with us because rent and utilities would cost him about 2/3 to 3/4 of his paycheck (rent is expensive here). Realistically, what he pays us doesn't cover his food.
Dating wise, he goes out and we about never see any of his friends, both male and female.
Personally, I wouldn't think any less of you. Actually, I think it's a great thing to do and if you meet a girl you're serious about and she decides she doesn't want to date you because of this. I'd wonder if the two of you were compatible anyway.
this should not affect your parents. they arent claiming you as a dependant right? i think you might be too old for a child. they do their taxes and you do yours. you pay the loans they incurred in your name and they get the benefit of claimng that interest. you get the benefit of being a good guy. chicks dig that.
as for the living arrangements. make sure they realize that you are a grown man now, with adult activities. be yourself, but be respectful. the same goes for the lady (or men) friends. be respectful and be yourself.
this is an admirable thing yo uare doing, but there will be growing pains. is their a basement or garage you can convert into an "in law" or "bachelor". that would probably make the living situation easier.
Make damn well sure this is a temporary arrangement.
Girls are understanding if you're down on your luck. But if you stay with your parents more than a couple years, it will look like you're not able or willing to be independant. This will trigger major warning flags to the sane, and they will presume you're after somone to take your mom's place. Independant ladies don't want to get into a relationship where the other seems to "want to be taken care of", and if you're in your 20's and still living with your parents, what else are they to think?
So in light of the current economic situation, I've been doing some thinking.
I am 24, currently rent an apartment, live alone, have a decent (stable) job and I am single. I live approximately 10-15 minutes away from my parents.
My parents aren't particularly well off (part of the struggling middle class) and helped send me to college (paying half), ending up with about $35k in parent-student loans. They have very little in the way of retirement savings, so to be blunt, they'll basically have to work until they die.
So I am considering moving back in with them, temporarily (approximately 2 years). I have a couple of reasons for this:
1. Rapidly pay off their portion of my student loans. Converting my rent and discretionary funds to loan repayments funds.
2. Income buffer. If either one of my parents lost their jobs, they'd be in some serious financial trouble within a short period of time. My dad has been laid off twice, and has high ethical standards which has caused him to lose his job when he wouldn't participate in unethical behaviors (he's in sales, currently car sales). My mom is getting burnt out working as the administrative assistant for their church, doing the work of 3 people (spending nights and weekends doing work at home or at the church) for just a few dollars over minimum wage.
I have a couple of concerns with it though as well:
1. How would my added income (loan repayments) affect their taxes? Would it be seen as a gift, and be limited as such?
2. How would the situation be perceived in my dating life? I already know any 'bedroom' time would take a hit, but I'm not supremely active anyway...
Just curious - did they ask you to move back?
Unless they claim you, neither of you have any tax liability for the other. you just won't be building a credit history by paying rent.
Unless they claim you, neither of you have any tax liability for the other. you just won't be building a credit history by paying rent.
They haven't officially asked me to move in, just more conversations along the lines of "If the economy goes to hell, we can all move in together". Basically following the lines of living arrangements in early years of this country, during the Great Depression, and throughout history.
As far as I know, you don't actually build a credit history by renting, although you can negatively impact your credit rating for nonpayment of rent (if you have a judgment against you). At this point, I'm not at all concerned about my credit scores (two are in the 800s, 1 is in the high 700s), my biggest challenge is my debt-to-income ratio due to my own school loans (about $40k), no credit card debt though.
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