Living with your parents is often viewed as a negative when you’re an adult. The idea is that you’re supposed to go out on your own, not rely on mom and dad. However, one Reddit user is wondering if living with his in-laws could actually be a good thing — even though he has plenty of money to buy a place of his own.
The original poster (OP) said he and his wife earn $550K per year and have two young children under age five. Their net worth is currently $3.5 million, mostly invested in money market and index funds. He works in tech while his wife works for a consulting firm and is considering starting her own firm soon. They are currently staying with his wife’s parents, they’re getting along well, and they are in her childhood home which is in a place where they’d love to buy but where a property would be out of their budget at around $4 to $5 million.
While they are house hunting, his father-in-law said he would love for the family to stay. The OP would start paying $3K per month in rent, which would go toward paying down the mortgage principal, and the grandparents could help with the kids while the OP and his wife could enable them to stay in their home during retirement and help them out with household tasks as they age.
While it seems like a win/win, the OP is concerned that he feels weird living with his inlaws as a man in his mid-30s with a considerable amount of wealth of his own. So, what should the Redditor do?
Multi-generational housing has big wins, as long as everyone is on the same page
Based on the OP’s description of the situation, it seems like a no-brainer. The couple is being offered the chance to stay in a property they like, at a below-market rate, and to get help with their children as a bonus. They can invest instead of having to sink a lot of money into a house that wouldn’t be as nice as the one they are living in — and that they would be stuck purchasing at a terrible time when interest rates are high and property values are through the roof in most areas.
The arrangement does not seem to come with any long-term commitment on anyone’s part, even if the goal is to maintain the status quo indefinitely, and the OP isn’t being asked to agree to assume legal responsibility for the mortgage or put up a large amount of money. He literally has nothing to lose as long as he doesn’t jeopardize the good relationship he has with his inlaws by accepting.
To make sure that doesn’t happen, the OP, his wife, and his inlaws should make sure everyone is clear about expectations up-front. They should address things like how they will split home repairs, what if any house rules they’d all need to live by to stay happy, and what would happen in the future if they decided to buy a house or if the inlaws decided they wanted to downsize.
If they can get on the same page about this, then the OP should not worry about what anyone else thinks of their arrangement. Multi-generational housing used to be the norm and with good reason as it can take a village to raise successful children and succeed in a tough economy. Living with his inlaws can provide a huge leg up due to the fact he’ll be getting a big break on housing, and it can also offer stronger family bonds.
A financial advisor can help address long-term issues
While the OP and his inlaws should not rush into making any permanent changes, the fact is that if they live together for a long time and things go well, it may be smart to start making some plans for the future.
Specifically, the families may want to ensure that the house can pass seamlessly onto the OP and his wife after the inlaw’s death (ideally without any estate taxes and with minimal transfer taxes). The families may also want to make a plan to protect the home in case either of the inlaws needs costly nursing home care.
A financial advisor can help the OP and his inlaws to address these issues and make sure everyone’s interests are being protected over time.
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