Your Children May Live With You Some More Years
Capture Them in Your Retirement Plan
Researches reveal the increasing number of young adults still living with their parents even when they finally come of age. Most young people tend to return to their parents instead of creating their residence and home after a remarkable achievement in their life, like at completion of military service or graduation from college.
According to a recent research conducted by Pew Research Centre, about 32.1% of people between the ages of 18 to 42 years are still living with their parents, rather than their partner or spouse in their own home, a leap from the 20% as at 1960. In the research, 36% were either married or living with friends outside their parent’s home, 14% were living alone; either single or as a single parent and 22% had some other special housing arrangement like college housing.
There are several contributors to this dramatic increase in the number of youngsters still living in their parent’s home. First of them is the postponement or termination of marriage plans. A disturbing number of young people are running away from the idea of marriage.
Also, unemployment and low income have contributed a high percentage to the number of youth still living under their parent’s roof; particularly the young men. Employed young men are more likely to leave their parents and live independently than their unemployed counterparts. Sadly, the unemployment rate has dramatically increased in recent times.
In simpler terms, the tendency of your adult child to be under your roof is not only high; they may contribute little or no financial assistance to the home.
The bulk, however, falls back to the parent who begins to make unplanned expenses even as they approach or enter retirement. Based on your current financial status, this could make you work longer; engaging in full or part-time jobs to make ends meet, even after retirement from civil service.
Although your federal retirement benefits may come in handy here, it may not do much. Hence it is good to know how far it can go.
It is perhaps important for you to put up your adult child on your Federal Employees Health Benefits (FEHB) family registration, pending when they turn 26. Although the insurance package may still be extended a further 3 years, this is usually at a higher cost.
Also, the FEDVIP vision-dental health scheme can also cover your child, but not after they attain 22 years. This program, however, has several restrictions, and there is no provision for coverage extension.
SO what happens at death? The benefit a child gets has several cutoff dates. This benefit continues until the age of 18. Some exceptions, however, include:
- For full-time students, the annuity cover the child till he/she clocks 22 years, but benefits cease if the child dies, moves to a non-recognized school, gets married, ceases to be a full-time student, is unable to tender proof, when required of full-time studentship, or when enlisted in active military service or Academy.
- Where a child is disabled in anyway that makes it impossible for him/her to offer self-support and one that started before the child reached 18, the child will continuously receive the annuity for life – except if the child becomes healthy, marries, or regains ability for self-support.
- In some other schemes that have survivor/death benefits, the child’s living arrangement and age doesn’t count. This means that you can designate anyone as a beneficiary of your FEGLI regardless of age and living situations. There are exceptions though in situations where the insurance was particularly “assigned” to a number of beneficiaries – usually affected by a divorce order.
Hence, Uncle Sam may not offer so much assistance. The truth still stands: the primary responsibility of catering for your children, pending when they are financially capable and independent, falls back on the shoulders of the parents.