Kids In Parents' Pockets Eroding Retirement Savings (KIPPERS)

Kids In Parents' Pockets Eroding Retirement Savings - KIPPERS is a slang term referring to adult children who are out of school and in their working years but are still living at home with their parents. These parents face the challenge of managing their own finances and planning for retirement while dealing with the added expense of providing for adult offspring. Also known as boomerang children.

According to recent studies, most parents report that having KIPPERS is a pleasant experience - they like living with their adult children. However, it usually results in the parents spending more on running the household and saving less than they otherwise would for their retirement.

Contrast this to the situation of a married, working couple with no children at home, where discretionary income is often higher and saving for retirement is easier. This demographic group is sometimes referred to as Dual Income No Kids (DINKs).

A Pew Research Center study in 2016 found that nearly one-third of 18- to 34-year-olds lived with at least one parent, up from just 23 percent in 1960. "For the first time in 130 years, shacking up with Mom and/or Dad was the most common living arrangement for young adults, edging out being married/cohabitating, living alone, or living with someone other than a parent," Consumer Reports noted.

For parents struggling to save for retirement and contain costs, the magazine offered these tips: Don't allow freeloading. Make sure your adult children are financially responsible by setting goals, discussing household costs and assigning their share, even if they don't have the money to pay for them right now. Talk about timelines for leaving the nest, and educate them about the costs of living. Charging rent is a possibility and it's good to encourage your children to establish credit of their own so that one day they'll be able to qualify for their own place.

What's keeping kids from leaving home? "It doesn’t appear that a lack of jobs is keeping Millennials at home," Pew Research stated. "As of the first quarter of 2016, only 5.1% of older young adults were unemployed, down from 10.1% in the first quarter of 2010. Yet the share of 25- to 35-year-olds living at home rose during that span, increasing from 12% in 2010 to 15% in 2016." Among the factors cited by Pew and others: success in the labor market -- younger people can get jobs but not ones that pay enough to afford their own homes; and the cost of paying back student loans.