7 Tips to Help You Decide How Much Rent to Charge Your Kids ...

Alison

7 Tips to Help You Decide How Much Rent to Charge Your Kids ...
7 Tips to Help You Decide How Much Rent to Charge Your Kids ...

Are you wondering how much rent to charge your kids once they start working? Some parents are reluctant to charge their adult children any rent at all, and some kids feel that it's their parents' obligation to keep providing them with free accommodation even once they start working. But if you don't charge them a reasonable amount, you won't teach them some valuable life lessons. So how much should they pay? Here are some tips to help you decide how much rent to charge your kids …

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1

What do They Earn?

A good place to start when working out how much rent to charge your kids is by looking at their take-home pay. If they don't earn very much, it's probably not fair to charge them market rent. Many people choose instead to charge their offspring a certain percentage of their take-home pay, which can be a good option if they're only working part-time.

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When deciding how much rent to charge your kids, it's important to consider their financial situation. If your kids are only working part-time or don't earn very much, it's not fair to charge them market rent. A good alternative is to charge them a certain percentage of their take-home pay.

When setting the rent, it's also important to consider the cost of living in your area. Depending on where you live, the cost of rent can vary drastically. For example, rent in a major city is likely to be higher than in a rural area.

It's also important to consider the age of your kids. If they are still in school or college, they may not be able to afford full market rent. In this case, you may want to consider charging a lower rate or offering other forms of help, such as providing groceries or paying for utilities.

You should also consider the length of the rental agreement. If you are only renting out a room for a short period of time, you may want to charge a lower rate than if you were renting out the entire house.

2

Extra Costs

You should also take into account the money that your child is costing you, such as energy, water and food, especially if they have the usual youthful tendencies to leave lights on and take long showers. Bills are not cheap these days! Also consider if you'll be doing their laundry and cooking their meals.

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When deciding how much rent to charge your kids, there are a few extra costs to consider. Energy costs, such as electricity and gas, can add up quickly. Water bills can also increase with your child’s usage, especially if they tend to take long showers or leave lights on when they’re not in the room. Food costs are also important to consider, as you may be responsible for providing meals for your child. If you plan to do their laundry or cook their meals, that should also be factored into the rent.

In addition to the costs of living, you should also consider any additional expenses that may arise. If your child needs to purchase school supplies, textbooks, or other materials, this should be taken into account when setting the rent. If they are participating in any extracurricular activities or sports, there may be fees associated with those as well.

It’s also important to consider the cost of entertainment. If your child will be using your internet or streaming services, those costs should be factored into the rent. If they plan to attend movies, concerts, or any other type of event, those costs may need to be covered as well.

Frequently asked questions

Look at what they earn and what they can afford without being too stressed. Think about the cost of living in your area and maybe ask them to pay a small part of that.

Not always. You can charge less than a regular rent to help them save money, but enough so they feel it's fair and learn the value of money.

Talk to them and understand why. You can help by making a plan for them to pay back later or by temporarily lowering the rent until they can afford it again.

Some parents use it to cover household costs. Or, you could save it for your kids to give back when they're ready to move out. It's up to you and what you need.

You might start charging rent when your kids are adults and have a job. It can help them learn responsibility and prepare for living on their own.

3

Savings Account?

Some parents charge their children rent in order to teach them fiscal responsibility, but secretly stash the money in a savings account. Their idea is to later gift the money for a house deposit. If you decide to do this, it would certainly be a lovely surprise for your children (but do make sure that they don't blow the cash on something else!).

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Savings accounts are a great way to teach kids about fiscal responsibility. Parents can charge their children rent and then secretly stash the money away in a savings account. Once enough money has been saved, the parents can then surprise their children with the money, usually for a house deposit. It is important to make sure the money is not used for something else, as it is intended for a specific purpose. There are other ways to teach children about financial responsibility, such as giving them an allowance or teaching them how to budget and save. Teaching children how to be financially responsible at a young age will help them manage their money better in the future.

4

Frivolous Spending

When they get their first job, young people often feel rich - and start spending madly. As far as they are concerned, it's all fun money. If your child is the type to do this, you should make sure that you get your cut first; you could take a percentage so that they still have enough for frivolous spending but not at your expense.

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Young adults who have just gotten their first job often feel a newfound sense of financial freedom and may be tempted to indulge in frivolous spending. To help your child manage their money responsibly, you can set a limit on their spending by taking a percentage of their income for rent. This will ensure that your child still has enough money to have some fun, while also managing their finances responsibly. It is important for young adults to learn how to manage their money, especially when they are just starting out in the workforce. Encouraging your child to budget and save can help them avoid debt and financial problems in the future.

5

Market Rent

You probably won't want to charge your kids the market rent in your area, but it can be a good starting point to work out how much you want to charge them. You could choose to charge them a certain percentage of the typical rents, or 'discount' it by a certain amount.

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When deciding how much rent to charge your kids, it’s important to consider the market rent in your area. Market rent is the amount of rent typically charged for a property in your area. It’s a good starting point to work out how much you want to charge your kids.

The market rent is determined by the demand for rental properties in your area. Factors such as the quality of the property, the location, and the amenities can influence the market rent. For example, a property with a large garden or a property that is close to public transportation might have a higher market rent than a property without these amenities.

When setting the rent for your children, you may want to consider the cost of utilities, repairs, and maintenance. You should also consider the cost of any furniture or appliances that may be included in the rental agreement. If you are providing these items, you should factor in the cost of replacing them when calculating the rent.

In addition, you should consider the amount of time and effort that goes into managing the rental property. If you are responsible for collecting rent, managing repairs, and dealing with tenant issues, you should factor this into the rent.

6

What is Included

Also consider what will be included in the rent and what they will be using. Will they be spending a lot of time out of the house? Will they cook their own meals and buy their own food? And does their girl/boyfriend stay over a lot?

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It is important to consider the amount of time your children will be spending away from the home when setting the rent. If they will be out of the house for most of the day, or on extended trips, then the rent should reflect that. You should also consider if they will be cooking their own meals and buying their own food. This could influence the amount of rent you set, as you may need to cover the cost of groceries.

Additionally, you should think about whether or not their significant other will be staying over a lot. If so, then you should consider charging a higher rent to cover the extra costs of having an additional person staying in the home.

7

Do You Need the Money

You may want to help support your adult children financially, but economics may dictate otherwise. If you don't have the income to keep subsidising them, then it's fair to charge a reasonable rent, depending on how much they earn.

If your kids complain that you're charging too much, simply check the prices of similar rooms in shared houses - which are bound to be a lot higher - and point out that they're free to move out if they prefer. They will soon realise that you're offering a pretty good deal! What did your parents charge you when you started working?

Feedback Junction

Where Thoughts and Opinions Converge

Why are we calling them kids when they are young adults to be prepared for life. They are young adults and the sooner we show them how to budget the better. They need to be prepared for the real world and understand that aspect of life. We are setting a standard for their future and help them make good decisions with their finances. I made 800 Dollars at 18 and gave my grandpa 300 and for me that was completely normal. We are to make good stewards out of the children by the Grace of God.

We are a large family with one income, I earn a little helping out a friend also. My high schoolers that are working only pay for the extras they want, i.e. clothes, snacks, movies, eating out with friends, gas for outings. We provide what they need. They may not want what is for dinner that day but it's there. We provide things that they want as we can afford it. I'm frustrated that an adult offspring is working full time, does little around the home, and doesn't contribute financially. If they were going to school I'd feel a bit differently about it. They've planned to go to school but put it off a few times. How long do I wait before figuring that it's not happening?

My boyfriend has always paid rent since he started working at 15; I think it's a curse and a blessing. I think his parents are weird for choosing to do that, but he's learned how to live and knows how to budget his money from the process. My folks had a go with me but $50 a week is nothing on preparing me to move out, and plus now I'm studying full time so don't bother anymore.

Hi, When i started my first job i used to pay my mum half of my earnings, and as she still looked after me it felt the natural and respectful thing to do. Now my son who is 27, still lives with me works and earns more than i do, he pays me a fifth of his wage as living costs, and hes saving money for his own place. He is happy to do so, he offers to give me more but i refuse as i want him to save most of his money. He understands how much everything costs, and he doesnt want to be thought of as a freeloader, but he knows i would never think of him that way. He is learning to be responsible and adult, and i am proud of him.

Alysha commented, "This is horrible. If you don't want to pay for your kids don't have any!" This article was focussed on how much working grown children should contribute towards their costs when living in the family home. The comment 'If you don't want to pay for your kids don't have any' is similar to kids also saying "I never asked to be born!" Both of those comments are feeble arguments. It was taken for granted in my family that once adult and working you would contribute to the family housekeeping budget. Ultimately without fiscual responsibiity your adult child is less prepared for the future.

I personally like the idea of saving the rent money into a savings account for their son/daughter. I think that it is reasonable to expect and ask working adults to help out with rent if the parent needs it. I have a son and would gladly support him until he is capable but once he is capable and starts helping out with rent and utilities without being asked I would certainly feel so proud. It really goes two ways :)

When I was 14 years old my Dad said I'm going to charge you $40 a week (1975) when you graduate high school. I thought why the hell does he need 160 a month from me , no way! My out marriage. Not the answer. What important is teaching a good work ethic ,and further education which my parents didn't . But as a former single Mom I've taught my daughters. Who are self reliant and never as for a thing!

This is horrible. If you don't want to pay for your kids don't have any!

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