In a reversal of a long-time trend, the high cost of living is creating a record number of households where parents, grandparents, and children share the same roof.
According to a new report by the Pew Research Center, a record 16.1% of the population is living in “multigenerational” households… a jump of nearly a third since 1980.
This signals a reversal of a 40-year trend during which the number of people living in “multigenerational” household fell from 25% in 1940 to just 12% in 1980.
The Pew report sites several reasons for the shift, including high unemployment, growing numbers of home foreclosures, and people marrying later and later in life. During the worst of the economic downturn from 2007 to 2008, the Pew study found the number of Americans in multigenerational households grew by 2.6 million.
Donna Butts, Executive Director of Generations United in Washington, D.C., said that the economy had forced many retirees to give up their independence move in with adult children.
“Older people who had planned for a comfortable retirement lost a pretty serious chunk of their capital and don’t have the potential to earn it back the way somebody in their 50s can,” she said.
Many retirees looking for a different option than moving back in with their children are looking abroad for places where they can still enjoy a quality retirement for less than it would cost in the U.S.
Places like Panama, Mexico, Ecuador, Belize, Costa Rica and other Latin American countries are seeing greater numbers of retirees moving either full-or part-time in an attempt to make their money go farther and still live comfortably.
“It’s hard to say exactly how many people are giving up on retirement in the U.S.” said Jackie Flynn
, Publisher of InternationalLiving.com, a company that publishes information on living, working, and investing abroad. “But I can say that attendance at our events in countries like Ecuador, Panama, and Mexico is skyrocketing. We recently had nearly 400 people fly all the way to Quito, Ecuador to explore their options for living or retiring abroad. It’s pretty clear by talking to them that they feel they’ve been priced out of a quality retirement in the U.S and are actively looking for options outside the States.
“They don’t want to live with the kids,” said Flynn. “They want the kids to come down and visit them on the beach, and they’re finding places where they can do just that for half or less what their cost of living would be in the U.S.”
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