One in three 18- to 34-year-olds in the UK were living with their parents last year, equivalent to almost five million young people, according to official figures. Sky-high house prices, climbing unemployment, and sticky inflation have left hundreds of thousands of young adults with little choice but to stay home or return after university.
Prime Minister Andy Burnham last week pledged to curb the rise in young Neets, those not in education, employment or training, a group that now numbers more than one million. Even graduates who secure jobs are often working from childhood bedrooms to save money, as first-time buyers now spend an average of £226,000 for a home, according to comparison website Finder.
The Real Cost of Having an Adult Child at Home
Calculations by wealth manager Quilter found that having an adult child at home costs parents £3,246 a year in food, energy, and water bills. That figure includes an extra £2,421 a year on food alone, covering groceries, takeaways, and meals out. Energy bills rise by an additional £669 a year under current Ofgem price cap rates, based on a household moving from medium to high usage. Water costs increase from £832 to £988 a year for a two-person household that gains one extra occupant, according to data from Southern Water.
If one child lived at home from ages 18 to 34, parents would spend an extra £55,187 over that period, Quilter calculated.
Having the Money Conversation
Financial coach Catherine Morgan, who hosts the It's Not About The Money podcast, said timing matters when raising the subject with adult children. She recommended starting the conversation well before it becomes urgent, and choosing a relaxed moment, such as over dinner on a weekend, rather than during a stressful period. Money is emotive, she noted, so the setting matters.
Once the conversation is open, families can assess whether the child wants to move out and map out what it would take to get there. Options include cash individual savings accounts, which allow savers to deposit up to £20,000 a year and earn interest free of savings tax, falling to £12,000 from next April for those under 65.
For those planning to buy a property priced below £450,000, the Lifetime Isa allows first-time buyers to put in up to £4,000 a year in cash or investments, with the government adding a 25 percent top-up on annual contributions.
Whether to Charge Rent
Nicholas Mendes of broker John Charcol said the most successful cases he sees are not ultimatums but family-wide plans, typically set six to 12 months in advance. He warned that problems arise when parents keep paying for everything indefinitely rather than directing support toward a deposit or mortgage structure.
Morgan said that for children who are already saving, charging rent on principle can work against the shared goal of moving out. But for those who are reluctant to leave, rent can provide the necessary nudge. If a parent charges £300 a month while a room in a shared house costs £500, the child may find the extra £200 worth paying for their own space, and may decide independent living is preferable. One approach is to charge rent and save it in a separate account to hand back when the child is ready to move.
Morgan cautioned that charging rent works best when paired with a plan and an open conversation, adding that on its own it can create a resentful tenant.
Helping With a Deposit or Mortgage
The average first-time buyer deposit in England is £63,855, and more than half of first-time buyers received financial help to reach that figure, according to estate agency Savills. Parents who gift money for a deposit typically need to provide a letter confirming the sum is a gift with no expectation of repayment and no rights over the property, said David Hollingworth of broker L&C Mortgages. He noted that a loan rather than a gift can reduce how much a child is able to borrow, as lenders factor in repayment obligations when assessing affordability.
Morgan expressed reservations about gifted deposits, arguing they can remove personal accountability and prevent young adults from building financial resilience.
For children who have a deposit but cannot meet affordability requirements alone, a joint buyer, sole proprietor mortgage allows a parent's income to be counted alongside the child's. On a £300,000 property requiring a £270,000 loan, a child earning £30,000 might only qualify for £150,000 on their own, but with a parent earning £40,000 added to the application, the pair might borrow up to £350,000. However, if the child stops making payments, the parent becomes liable while gaining no ownership stake in the property.
Mendes said parents entering such arrangements should agree an exit plan from day one and factor the liability into their own future borrowing and retirement planning.
