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During the first half of the twentieth century, multigenerational families were the norm. As the stock of affordable housing increased, the Baby Boomers’ children went off to school, and older Americans’ health and wealth increased, the nuclear family became the norm, with grandparents perhaps living nearby but not under the same roof.

Trends in Multigenerational Households

That is changing. As of 2021, one out of five American adults lived in a multigenerational household: one with at least two generations of adults. Some of these were composed of boomerang children. Some of these reflected the need to move in with Mom or Dad, or have them move in, to provide needed care and companionship. But a rising percentage are composed of young families benefitting from child care and financial assistance of parents who are near or at the beginning of the retirement years. This is increasingly true of new home buyers. According to the National Association of Realtors, 11% of new home buyers in 2021 and 14% of new home buyers in 2022 were multigenerational households.

Planning for a Secure Family Future

Different families have different financial arrangements and different and changing needs for assistance and tolerances for privacy and intergenerational advice. Some arrangements may work for a few years. Some may be ongoing.

It is important to document the different ownership interests in the home, preserving it from being counted for Medicaid eligibility if Mom or Dad later need Medicaid home health or nursing home Medicaid.

Similarly, if Mom and Dad are contributing to monthly expenses, it is important to have a written lease so that that contribution is not seen as a disqualifying gift.

We all know that children can benefit from regular interactions with grandparents and that two parents working outside the home, which is also the norm today, can use some help. Just be sure to document the arrangements to preserve eligibility for means-tested public benefits somewhere down the line. Eighty percent of us will need long-term personal and medical care as we age.

 

Elder law attorney, Terry Garrett, CELA, is a member of the National Academy of Elder Law Attorneys and is an Approved Guardianship Attorney. She assists people in elder law, estate and special needs planning, guardianship and settling estates. She graduated with honors from Cornell University. She was on the Dean’s List at Wharton Business School. She earned her J.D. at Columbia Law School, receiving the Parker Award and a Mellon Fellowship.

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