You had your best-laid plans and then COVID-19 came along and hammered the entire economy. But youve got this if you have the right information. Join Rob Carrick and Roma Luciw on Stress Test, a podcast guiding you through one of the biggest challenges your finances will ever face.

ROB:You spent your childhood and teenage years under their roof. Should you move back in with your parents if it makes sense financially? Thats our big question today.

Welcome to Stress Test, a Globe and Mail podcast where we look at how the rules of personal finance have changed in the pandemic for Gen Z and millennials. I'm Rob Carrick, personal finance columnist at the Globe and Mail.

ROMA: And I'm Roma Luciw, personal finance editor at the Globe. Well, Rob, this is the last episode of Stress Test that we'll be recording this summer. And I'm feeling a bit nostalgic.

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ROB: Me too. You know, I think when we started this, it was like, there was snow on the ground and now it's like blazing hot summer like, so much has happened. The pandemic is still out there. But in Ottawa, where I live, people are out on patios and I have to confess I had a beer and a hot dog at a really nice patio by the Rideau Falls and things are looking up.

ROMA: Well, we had wine with friends on Friday night outside on their back patio, distanced but together, and I felt like old times. We were all so happy to just spend some time together outside without the children for five minutes. It was a wonderful, wonderful experience.

In terms of the podcast, I think also for me, it's been a journey because I'm more accustomed to being the person that does the assigning and editing. I'm not accustomed to being in front of the microphone and talking about these ideas where people can hear me and I have to say, that over the course of the recordings, I've gotten more comfortable, and I really enjoyed it.

ROB: Talking about all this in a podcast is a bit like rehearsing future columns and also greatest hits from the past. It's just me sort of thinking out loud about what I've learned and making mental notes about things I want to look into further in the next few months.

ROMA: So we knew we wanted moving back home to be our last episode. Why are we talking about this today?

ROB: I think we're talking about moving back home with your parents because it ties together a lot of the themes that we've been discussing in the podcast like the gig economy, student debt, expensive housing. A lot of these trends work against people achieving quick and easy financial independence after they graduate. And it's going to send some of them back home where they can live cheaply and build up their resources to move out later on.

ROMA: So once again, we see the pandemic, emphasizing or exacerbating some of the trends that were already taking place, we'll see another pop in this. And so it makes sense to use this as a launching point for looking ahead in terms of what we'll see in the months and years ahead.

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ROB: Just as occurred after the last recession, I think the pandemic-driven economic downturn, however bad it turns out to be, is going to send a lot of people moving home and that's a good thing. I hope we can draw out in this episode that that's a smart way to handle a problem.

ROMA: Absolutely. If there's one thing I think we should do today, it's make sure that that's not a shameful thing. And we can talk that through as we proceed.

ROB: Today, we're talking about whether or not you should move back home with your parents to save money. I think now is the right time to talk about it.

ROMA: In every episode of Stress Test, we talk to real people and experts to see how the basic rules of personal finance have been stress-tested by COVID-19. Should you move back home? That's up next.

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ROMA: To find out what it's like when COVID causes you to move back home, we're taking you to Brockville, Ontario, which is halfway between Toronto and Montreal.

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RILEY: Hi, my name is Riley Morrison.

ROMA: Riley is 23 years old. Normally I live in Toronto but currently I am living in Brockville. So I was living in Toronto with my sister. Because I work in the film industry, everything is closed down so I can't work while COVID is happening. So we thought it would be best if both Paige and I came back to live with our parents until this is a little more settled or things open up a little more. So we came back.

ROMA: We spoke to Riley in April, just a month into COVID. In Canada, there was so much uncertainty. How was the new everyday routine going for Riley and her family?

RILEY: Surprisingly well. I mean, I haven't lived with my parents for more than two weeks at a time since I was 17.

ROMA: That's when Riley went away for school. And then she built the start of a pretty good career in Toronto.

RILEY: I'm an Assistant Director for film and television. I'm the fourth assistant director which means I'm one of the first people in in the morning and it's my job to make sure that cast go through hair, makeup and wardrobe. before we're ready to shoot at the beginning of a day. I coordinate with the wardrobe department. People who don't really know my industry when I describe myself job to them, they basically say that I sound like a babysitter. And it's kind of true.

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ROMA: The TV show she works on was shut down just like everything else, Back in the spring, Riley came home to Brockville where life really slowed down. At first, it was nice to have some family time.

RILEY: My dad declared Sunday movie night. So on Sundays, we make popcorn and we choose a movie and we all sit down and watch it together.

ROMA: Riley's family built fun routines for the new COVID life together. But the early days were still pretty stressful.

RILEY: My grandmother, she drove by and like stood outside her car and we stood at the door, and we were having a talk and she was asking me about things and it was what I was like really stressed like right at the beginning, and I ended up like, totally broke down in the yard. Because I was stressed about my rent and my worry come August like I don't want to lose my apartment.

ROMA: Riley still pays for her apartment in Toronto, which is her single biggest expense, while she lives at home, rent-free.

RILEY: So that night, my mom and I, we went over my finances, and we talked about it. And I have a bit of a plan now. So I'm okay

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ROMA: With all the stress of COVID. Being able to move home was a real relief.

RILEY: Financially speaking, it's really nice because the only money I'm spending right now is to pay my rent in Toronto. But I've been worried about my rent as I feel like a lot of people in cities like Toronto are because it's expensive.

ROMA: Because Riley and her sisters still pay for their rent in Toronto, their parents don't ask them to contribute financially to the household in Brockville.

RILEY: Which, you know, we're very lucky enough to have that kind of privilege. So it's nice to be home because I don't have any other expenses except for rent, which I only have to worry about once a month. The thing I've taken away from this is like, I haven't worked in retail in like four years, but maybe starting this year, like during the winter when I don't have a show I should get a retail job. So I have a backup. So I'm not dependent on EI. So I can work a little bit longer. Like it's just unfortunate that this thing I enjoy, my work that I love, I can't do. And I -- no one can give a like straight answer for when things are going to pick up or go back and that's the thing that frustrates me the most

ROMA: Overall, how does Riley feel about living at home during COVID?

RILEY: I don't feel bad about living with my parents right now because it's not like I've made some massive mistake in my career or a relationship and I need like, I mean, obviously, I needed to come home and it's financially better. But like, I feel reassured that it's not my fault. Like, this horrible pandemic happened and I came home, but like, it's not because I failed at anything. So I'm happy to be with my family, knowing I have not failed in anything.

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ROB: Im glad Riley mentioned the word failure because its a word I do not want to hear associated with the idea of moving back home. Its a rational, smart, shrewd thing to do. If you cant afford your rent if you cant afford to be living where you are, use the help available from your family. Its a smart thing to do. And you know, I find quite often parents are quite happy to offer that level of assistance to their adult kids.

ROMA: Certainly seemed like for Riley and her sister, her parents were willing and able and happy to help. I'd like to point out that in the meantime, Riley has moved back to Toronto and is in her apartment. She hasn't been forced to take on debt. And she's in a better financial situation that she would have been had she been living in Toronto, buying her own groceries, paying for all her bills. In the meantime, she got to go home, take a breather, and she's in a better situation overall, why wouldn't you do that?

ROB: We're grateful to Riley for telling us what it's like to move home during a pandemic. But COVID is just the latest reason why you might have to move back home.

ROMA: At this point. It's worth asking ourselves, why is it a big deal that people are moving home after graduation instead of going out on their own? How did we get here?

ROB: The idea of students moving home as a social trend got some traction after the last recession in 08 09 the economy tanked hard. And a lot of millennials started moving back home. And I remember it well, because there was a certain sourness about this as if all these millennials were losers moving back home. Remember failure to launch, the boomerang generation. Its like they went out on the world and just couldnt hack it and had to move home. The ignorance level was just stunning to me, like oblivious to the disappearance of jobs to the fact that millennials were only getting part-time jobs or temporary jobs. They werent able to use all the skills they built up getting their education. And gradually we got used to it because people started to realize especially the parents of millennials, the economy is extremely challenging. The opportunities are not the same as they were for previous generations. And just as we were getting used to it, I think were going to face a big pop and this again, theres going to be more millennials and members of Gen Z, who are not going to be on a traditional career trajectory, which means graduating from school, getting a great job, getting a first apartment and living that great phase of life, when youve just got off your first job and your income is substantial and the worlds in front of you.

ROMA: Let's remember that there are cultures and where it's normal and preferable for young adults to live at home until they marry until they can afford a house. In some cultures, kids and parents live together, grandparents then help adult children raise their kids, but for many other people, there's an expectation of this progression from university or college to a career to financial independence that includes getting your own place and not popping back in and out of mom and dad's house. That wasn't the case for me. I certainly remember moving back in with my parents after university. There were chunks of time in my life where I wasn't working where my life was in flux. It just didn't make sense for me to be renting a place and it was feasible to my parents to help me. I don't know where this shame idea came from, but I think if your parents can help you, it only makes sense to do that.

One of the things I'm seeing in the circles around me is parents of kids who are in school Elementary School in high school are preparing themselves for that kind of future. So we have some friends on our street that are doing a renovation, they're setting up their basement as almost a self-contained apartment with the expectation that one of their sons is at some point going to have to move back home, and they're going to be in a position to help him. I know of other people who were in their late 20s or early 30s and wanted to save a chunk of money for a down payment. What did they do? They move back home. Rob, you know this from personal experience, and we're going to hear from Rob's family. That's next.

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ROMA: So, Rob, this is where we hear from your family. And I looked down a timeline to see what my life is gonna be like in 10 years [laughs].

Rob actually wrote the book on this topic. It's called How Not To Move Back In With Your Parents, The Young Person's Complete Guide to Financial Empowerment. We're going to hear from your family now. You want to tell us who we're hearing from?

ROB: We're gonna hear from my wife, Theresa, and our oldest son Will, he's 26. He spent four years in Toronto, going to university there, then he moved back here. While he was finding his first job. Will works in the gig economy he's currently employed, working in graphic design and art. Our family lives in Ottawa. We recorded our family conversation in early June and started by getting Will to tell us what Theresa is like to live with.

WILL:I know that my mom really loves to keep a clean house. I like my space to feel a little lived in. I've noticed that my mom, you know, she, she really likes to make a good impression on guests, you know, the place has got to be clean for that kind of thing with me, it's like, you know, whatever, I'll do some dishes. And that's good enough.

THERESA: His room was a little bit messier than ours. And I would try to stay out of it. And every once in a while, I just couldn't help myself I would just go in there and with a garbage bags and clean things out, but you cooked amazing dinners.

WILL: That made up for it [laughs]. But honestly, like, I think is there's definitely more of like a give and take. I feel less like I'm just owed anything and more like I need to contribute to the household.

ROB: I think that's a really good observation. And you know, now that you've mentioned it Will, I thought that was exactly what was happening. You know what, you did make a lot of the dinners like it was I felt like we had a chef living in the house and it was I thought that was a huge contribution like, on nights where wasn't making dinner, Theresa and I just sort of looked around and thought we better go out [laughs].

THERESA: Thats right! Will gained life skills, we lost life skills -- the ability to cook dinners.

ROB: You know, kids moving back home after university is something as a subject that I think you really are only aware of if you're a parent with kids in their 20s. And so tell them about your book club. And all the comings and goings of the kids of the members.

THERESA: Right. Every single member of my book club has had their kids come and go and many still have their children living at home now, even well into adulthood. It's just, not only is it financially difficult to have your own place and expensive. The job market is so precarious even our own kids, they're employed right now. And yet it's so hard to find permanent employment, and then layer on that, just the complexities of life and the fact that kids may struggle with physical health issues, mental health issues, changes in relationships that are going to bring kids back home again, sometimes. I've seen all that among my friends, and a little bit of that with ourselves with our own kids.

ROB: The whole point of letting your adult children move back home is to help them get a handle on their finances. When Will did that he got his own place. The key was to land a stable job.

WILL: I knew I wanted to live alone. So that kind of helped me sort of budget what kind of apartment I was looking for, something like a bachelor, you know. And then once I had the first and last month's rent, and then I think money for two or three more months after that, I think it came out, I don't know, like five $6,000 then I was able to kind of comfortably say to myself, okay, I can I can move out and I know that I'm not going to end up on the street and you know, yeah, although I know my parents wouldn't allow that.

ROB: I have taught that boy well [laughs].

Are there any downsides to moving back in with your parents?

WILL: I think there's definitely a loss of freedom. Nonetheless, when you are living with your parents, I guess you feel some sort of obligation to you know, let them know where you're going or you know, all that kind of stuff. And then I guess there's also the element of living with somebody who isn't a college student, which is, you know, two very different standards in terms of, I'd say cleanliness and I guess, home maintenance.

ROB: Also, some recreational activities may have to be moderated or adjusted for communal living [laughs]

WILL:Touch, yeah.

THERESA: Will moved out when he was just 18 and moved back after he graduated. He was really just a high schooler when he left and he was an adult when he came back. So mentally, I found for me, it was a big adjustment. Was I going to be his mom? Or was I his roommate? And if they were to move back in again, at some point, you know, we would have a whole different Will and Jamie that we had to get to know and develop a relationship with.

WILL: I think it was very interesting getting into my own place and realizing I can just go wherever I want and do whatever I want and spend my money on whatever I want. Right? And I think there's definitely a period where I had to kind of, you know, learn the hard lessons about that sort of thing and learn how to, you know, moderate financially, and otherwise. You know, I'm constantly trying to, you know, turn myself into an adult, I'd like to behave more as such.

THERESA: This is where it's great when your dad is a personal finance columnist because I've found that Rob and the boys had this ongoing conversation about how they manage their finances. And Rob sort of had this really nice way of very gently kind of easing back on getting involved with their finances. And I'm really impressed with how financially responsible both of them are.

ROB: My one rule is no credit card debt. And if you ever have it, you come and talk to me and we will kill it off right away, because we're not, there's no way, that's just an endless trap. And far from that being a concern, actually, it's impressed me that both boys really know how to save. They know they're precarious workers because they work on contracts and they have both socked away a good amount of money and that really impresses me. Will, of all the things that you've learned about money at home what sticks with you?

WILL: I think it's a really a package deal of how to moderate your spending. One of the most important things that I learned, especially with the way that you're helping me sort of organize my finances early on, is that I need to make my money last. And I need to kind of be paying a little bit more attention on how I spend that exactly and where.

ROB: You know, I think all parents want to see their kids become financially successful and independent and be able to live the lives that they want to lead. And I think moving back home can be a way to strategically make that happen.

THERESA: For sure. And I guess what I would add is that, at the same time, there are things that our kids only learned once they move out, financial lessons they can only learn by living on their own and maybe feeling a little bit of nervousness and fear about how will I pay the rent and how much money am I spending week to week so it's always a balance between offering that space and enjoying spending time with them, but at the same time letting them grow.

ROB: Yeah, no, you know, I thought having the boys back in as adults was a kick really, you know what, like we had the best discussions ever. And, you know, were there tensions, of course there were but I thought it was a bit relaxing to be the parent of 20-somethings living at home. Like I've trusted them to go and come back when they needed to. And I had no concerns where they were going and what they were doing. I trusted them. And you know, there were moments when I thought it'd be nice to have a place back to ourselves again, but then we used to think we're going to be empty nesters again. So you know what, on the whole, a positive experience.

THERESA: It's nice to get to spend time with your kids that -- it's a little bit of a gift in, you know, in the middle of their adulthood that you get to spend time with them.

ROB: Any advice for someone who's going to make the leap and move back home, Will?

WILL: I suppose I would say adjust your expectations. It's easy to go back home and think that things are going to be just the way they were except now you're an older person and you can do whatever you want. But I think it's important to know that your parents aren't going to be you know, serving your every backing call all the time, you have to be a little bit more self-sufficient. And you know, make sure that the house that you're living in is, you know, everyone's doing their part.

ROB: And the other advice? Well give the last word to Will.

WILL:

Really kind of manage your expenses in a way where you know that you're constantly building towards that, like first and last month's rent that'll let you you know, get out of there as soon as possible.

ROMA: Rob, it was so nice to hear from your family. Will totally sounds like a kid that's got it all together. Sounds like he must have learned some of those money skills from you, either through osmosis or maybe some of those conversations eventually sank in.

ROB: It's osmosis, I think. You know, you never really know what your kids are listening to what they're picking up on. So anyway, however it was I was super-happy to hear that he had picked up a lot of the basic fundamentals and everything that I see it shows me that he's on a really good track for handling money.

ROMA: Rob, you wrote the book on this topic, How Not to Move Back in With Your Parents, The Young Person's Complete Guide to Financial Empowerment. But it was published over 10 years ago in the aftermath of the global economic crisis, when we saw the first wave of adult kids moving back home, what would you say has changed today?

ROB: One of the big differences to me is that back in 08 09, 2010, the gig economy was a novelty. People thought, Oh, interesting. Companies are only hiring millennials for short periods of time. Maybe well get back to normal and we havent got back to normal. That trend is a lot more pronounced now. And I expect it to get even worse. So I think helping millennials flourish in the gig economy would be a theme that I would hammer harder this time around. And I think Id probably want to spend more time helping young people pick a course of study that will develop into a decent-paying career. And I think I would also want to talk to them more about jobs or skills about developing a career how to get your foot in the door so that you get higher-quality contracts and you have a better chance of getting a full-time job.

ROMA: How much has the housing market impacted all this?

ROB: I recall back in 08 09, millennials were very keen to get into housing and I know theyre at least as keen today. I think its a little bit more economically out of reach because the past decade has been all about giant increases in house prices. So I think we might have to work a little harder to make millennials and Gen Z comfortable with the idea of renting for longer, Ive looking at alternatives to homeownership of not rushing into this financial straitjacket, waiting to get yourself more solid in the workforce before buying a house.

ROMA: One thing that stands out to me listening to your story, and with my own, is that it seems like the shame or stigma of living at home in your 20s and into maybe your 30s is sort of dissipating. Is that something you see?

ROB: I think it is you know, I moved back home after I graduated from journalism school back in the 80s. And I felt a little bit of shame but I had a job that was promised to me, it fell through for various reasons, and I ended up going to work for that employer later but I moved back in April. It took until December for me to start working again and then I moved out again in February but I did feel a bit, I didn't feel, I wasn't really proud of having to do that. Although it worked out super well. It was like up to me it was the prototype of an effective smart, moving back home, gathering your resources and then moving right back out again. Today I hear parents talk about it so normally they I hear parents talk about the quote, revolving door on their front door with our kids are moving in, they're moving out, moving in and out multiple times. We've seen that at our house. I think it is quite normal now. And I think it's seeping into the broader population. There's much less judgement about that. And I think that is such a healthy development.

ROMA: To me, one thing that stands out that we haven't really discussed is parents helping kids who can't afford it. I'm a little less worried about that when it comes to this idea of moving back into a house they already have. But when does that become dangerous?

ROB: I think that parental support for adult children becomes financially risky when the parents are digging into their own savings to help the young people. I think that digging into an RRSP to help young people buy a house is not an intelligent use of money. Often it's helping people get into a housing market they can't really afford. And so what value is really occurred from the sacrifice the parents have made? Parents need to keep themselves on a good trajectory for retirement. And I encourage them to help their kids as much as they want, and feel able to, without self-sacrifice. Now, there may be some, you know, day to day, month to month, year to year helping with various expenses, but I'm talking about taking a big chunk of money out of their savings and giving it to an adult child to pay for a house or for something else, that should only be done where it is clearly affordable.

ROMA: And what we're talking about for the purposes of this episode is mostly adult kids moving into their childhood home, and parents helping them out by giving them free rent. There are of course, other ways that kids could contribute that we've discussed. You could help out with some bills or you can help out by helping around the house, making meals doing things like that.

ROB:Absolutely. You know, there's a lot of value to be done in that. When our boys were home, they cut the grass, they shoveled the driveway, they made dinners. They helped with other tasks, they picked up stuff for me, they took the cars to the garage. I mean, the amount of time and money they saved was phenomenal. It was like so useful. So I thought there was huge economic value in that.

ROMA: One thing we're also seeing is parents helping their adult kids by paying for things like cell phone bills, car insurance, car loan payments, what are the ins and outs around that?

ROB: I have no problem with that. You know, I say that from the point of view of knowing that a lot of millennials and Gen Z, people are making minimal salaries, they've got high rents. They don't have a lot of money to do anything other than cover all the basics. So if you can take a little of the pressure off, and it's no problem for your parental finances. Basically, you're keeping the same family cellphone plan going after your kids are graduating, you're used to making the payments. If it's no sweat, why not keep on? As soon as they're able, as their income increases, you can fix that. Same with car insurance. It's just a little extra parental help that if it's affordable, I don't see a problem doing that. As long as it's understood that as soon as their salary moves up to a decent level, you offload that cost to them, pronto.

ROMA: So what we're talking about here is progression. What you want to see is someone who starts off in a more tenuous job position, perhaps in their early 20s. How they move through that, what kinds of steps they're taking, as they move into their mid and late 20s and into their 30s.

ROB: For sure, and if parents, if you see your kids forgetting to take on the cell phone bill after that, so don't hesitate to say, you know what, I see you're making more money now, why don't you pay for your cell phone?

ROMA: Rob, how do you prevent your kids from feeling entitled, like you should be paying their cell phone bill for them? Like it's sort of an easy thing? And why not let mom and dad take care of that? How do you help to make sure that they're progressing into a fully functioning, financially successful adult?

ROB: One thing is to make them realize the cost pressures of everyday life from a young age. So if your kids are going to university and you've saved up money for them through an RESP, you're going to have them contribute to this you're going to have understand this is how much tuition cost you want to go away? Okay, here's how much a dorm room is going to cost for accommodation. What can you kick in? They need to understand the economic value of living as an adult. And you can help them do that, as they take their very first step as an adult, which is going to university giving up high school, going to university taking on this big cost of education, they should have some skin in that game.

ROMA: It's interesting you mentioned that. My son just got his first cell phone, and we are having him pay for the cost of that phone each month. He wanted a cell phone. We didn't think that he needed one yet. We came to an agreement. You want a cell phone, you pay the monthly bill. What we're talking about here, and I think what you and I are both seeing, is that we need to have a higher degree of financial literacy. And that just means talking to your kids about money and how to manage it and how to handle it.

ROB: Right.

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Read the transcript for episode eight of Stress Test - The Globe and Mail