At MarketWatch.com today, Quentin Fottrell reports that the number of multi-generational households has been skyrocketing in the last few years. Translation: a bunch of adult Americans are still living in Mom’s basement. That’s not good for them, or for the economy. Household formation is a great catalyst for economic growth, and more importantly, developing financial independence begins with, well…, independence.
Young adults need to break out on their own and attempt to become members of the ownership society. Now, there are demographic trends holding back household formation. For instance, immigrants tend to form multi-generational households at higher rates, and single-parent families also remain at home longer than would a nuclear family. And as Fottrell writes, college education makes a big difference in the ability to form a household:
More young U.S. adults live with their folks, Cohn says, and that doesn’t include those still studying. Among Americans aged 25- to 29 in 2014, 31% were part of multigenerational households. The share and number of 18- to 34-year-old adults living with parents surpassed other living arrangements in 2014 for the first time in more than 130 years. Education levels make a big difference: Young adults without college degrees are now more likely to live with parents than to be married or cohabiting in their own homes, but those with college degrees are more likely to be living with a spouse or partner in their own homes.