Author Topic: Living with parents vs Rent vs Super Rent  (Read 9161 times)

MrSapolio

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Living with parents vs Rent vs Super Rent
« on: December 29, 2014, 10:50:46 AM »
Dear,

I have found myself in a kind of a tough dilemma. This is my first post.

I have received and accepted a job offer to work for a multinational company in my home city, where my parents live. Sor far, 3 months have passed and I have been living with them while I have been looking for an apartment. Right now, I am considering 3 possible options regarding where to live.

First:
Live with my parents. In this option, I would stay where I am currently living. It is a middle class 3-bedroom house. It is only me, my mom, my dad, and a bird. Considering this option, I won't need to pay rent and HOA fees and would count with all the convenience like not concerning about laundry, preparing dinners, etc. Probably I would help with the monthly expenses, something very discrete (2 - 5% income). The cons would relate to lack of freedom and the 35 minutes commute time (driving). In this case, I would end up saving ~ 75% of my income.

Second:
Rent a 1 or 2 bedroom apartment in a very modest condo. In this option, I would have no air conditioning or any amenities (like pool). The apartment itself is very simple and the neighborhood would be loud (a lot of people and car noises). The apartment is close to work and I can get there walking (15 min) or 5 min by car. In this case, I would end up saving ~ 60% of my income.

Third:
Rent a nice 2 bedroom apartment with air conditioning and amenities. The apartment is very nice, very comfortable. The apartment is close to work and I can get there walking (15 min) or 5 min by car (same distance as the second option). In this case, I would end up saving ~ 50% of my income.

About me:
I am 32 years old, live in Brazil, no wife, no kids.

Thank you for the help.


Zikoris

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Re: Living with parents vs Rent vs Super Rent
« Reply #1 on: December 29, 2014, 11:25:47 AM »
Could you get the nice two bedroom and rent out the extra room? That would seem to give you the best of both worlds - nice place to live, short commute, and low expenses. Otherwise I would go with option 2.

Murse

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Re: Living with parents vs Rent vs Super Rent
« Reply #2 on: December 29, 2014, 12:07:26 PM »
Dear,

I have found myself in a kind of a tough dilemma. This is my first post.

I have received and accepted a job offer to work for a multinational company in my home city, where my parents live. Sor far, 3 months have passed and I have been living with them while I have been looking for an apartment. Right now, I am considering 3 possible options regarding where to live.

First:
Live with my parents. In this option, I would stay where I am currently living. It is a middle class 3-bedroom house. It is only me, my mom, my dad, and a bird. Considering this option, I won't need to pay rent and HOA fees and would count with all the convenience like not concerning about laundry, preparing dinners, etc. Probably I would help with the monthly expenses, something very discrete (2 - 5% income). The cons would relate to lack of freedom and the 35 minutes commute time (driving). In this case, I would end up saving ~ 75% of my income.

Second:
Rent a 1 or 2 bedroom apartment in a very modest condo. In this option, I would have no air conditioning or any amenities (like pool). The apartment itself is very simple and the neighborhood would be loud (a lot of people and car noises). The apartment is close to work and I can get there walking (15 min) or 5 min by car. In this case, I would end up saving ~ 60% of my income.

Third:
Rent a nice 2 bedroom apartment with air conditioning and amenities. The apartment is very nice, very comfortable. The apartment is close to work and I can get there walking (15 min) or 5 min by car (same distance as the second option). In this case, I would end up saving ~ 50% of my income.

About me:
I am 32 years old, live in Brazil, no wife, no kids.

Thank you for the help.
I don't think you should live with your parents if you don't have to, just my personal bias. I think it is good for us to be as independent as we can. Being able to save >50% in my mind means you don't have to. Between the two appartment options assuming your numbers are right is the better appartment worth working an extra 6.5years for (assuming you even want to FIRE.) according to the shockingly simple math you would be FI in 17 years with 50% savings rate or 10.5 years with a 65% savings rate. Just think about these numbers when you make your decision.

Future Lazy

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Re: Living with parents vs Rent vs Super Rent
« Reply #3 on: December 29, 2014, 12:40:23 PM »
I would choose the second option.

Being able to save a bunch by living with your parents (option 1) would be ok, if it didn't sound like you were just going to return to being a teenager ("I won't need to pay rent and HOA fees and would count with all the convenience like not concerning about laundry, preparing dinners, etc.") which is pretty unfair to your parents. An adult living with parents should be paying rent to their parents, and helping out with things around the house/making their own meals just as if they were living with non-parent roomies.

Option two sounds pretty comfortable but modest. You don't need A/C or a pool. Use noise cancellation at night, like music or ambient sounds, and walk to work, don't drive. 60% is pretty good, and I bet you could return to 75% by trimming some fat.

Best of luck!

FeynmanFan

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Re: Living with parents vs Rent vs Super Rent
« Reply #4 on: December 29, 2014, 12:45:03 PM »
Parent of Adult Children Here:

How about re-expressing Option #1 from the point of view of ol' Mother and Father -- i.e., their increased costs, their loss of privacy, their loss of freedom, the private shame of trying to explain why their middle-aged son has returned home, the real financial concern of an unplanned-for burden on the retirement plan?

Parents feel successful -- and are successful -- when their children launch. It sounds like you launched, but then failed to achieve orbit so are back at the docking station. And for selfish reason ("hey, I finally got a great job but don't want to pay real rent and be independent"). That's simply terrible.

Taking advantage of Mother and Father, no matter how loving they are, isn't a respectable path to FI in my humble view. It's instead called freeloading.

So you don't have a "dilemma." Instead, you are fortunate. You have a job. And your parents are likely hoping you move out. And you should. So you only have two options, not three.

dandarc

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Re: Living with parents vs Rent vs Super Rent
« Reply #5 on: December 29, 2014, 12:52:38 PM »
Granted, I'm not sure of the cultural norms in Brazil, but I'm on team "move out of your parents house".  Seriously - you're debating between 50% and 60% savings rates, and as others have pointed out - option #3 with a roommate sounds pretty appealing.

Kaspian

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Re: Living with parents vs Rent vs Super Rent
« Reply #6 on: December 29, 2014, 01:08:03 PM »
You've been raised successfully, educated, and have a job.  Your parents have done their jobs.  Pay them rent.  The word for somebody who doesn't is "freeloader". 

curler

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Re: Living with parents vs Rent vs Super Rent
« Reply #7 on: December 29, 2014, 01:14:19 PM »
It seems like there is also a 4th option that would be a compromise between the second and third:  Can you get a nice 1-bedroom apartment with air conditioning and amenities.  A single person doesn't need two bedrooms (I have a hard time figuring out what to do with my entire one-bedroom by myself).  Can you get the nicer unit without a second bedroom?

MrSapolio

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Re: Living with parents vs Rent vs Super Rent
« Reply #8 on: December 29, 2014, 01:23:53 PM »
FeynmanFan - Yeah, you are probably right and now I am feeling bad.

dandarc - I would never consider having a house mate. Basically I enjoy being alone and I actually donít appreciate very much going out. Thatís the reason of considering renting a nice place to live (I spend a lot o time at home, watching movies, learning on the internet, etc).

Kaspian Ė I definitely would pay rent for my parents; however, they would never accept. If they do so, they would probably save that money for me latter.

curler - Yes, I could. However, unlike in the US, the bedrooms in Brazil (especially for the new constructions) are tiny. It is impossible to fit my queen size bed and my computer desk into the bedroom. That's the reason for a 2 bedroom apartment. I would convert the 2nd bedroom in an office space (I spend a lot of time on my computer).

Roots&Wings

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Re: Living with parents vs Rent vs Super Rent
« Reply #9 on: December 29, 2014, 02:34:13 PM »
Since you're getting a lot of criticism for Option 1, I'll chime in for that one, assuming that you (and your parents) are both happy with that arrangement, and you're able to flourish in that environment (socially, financially, etc).

Having a supportive multi-generational family home can bring lots of great benefits, but of course can also have potential downsides like loss of privacy.

Here's another recent thread about someone dealing with criticism for living at home in case helpful: http://forum.mrmoneymustache.com/ask-a-mustachian/tips-for-living-with-parentsdealing-with-critics/   

Future Lazy

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Re: Living with parents vs Rent vs Super Rent
« Reply #10 on: December 29, 2014, 02:40:42 PM »
Kaspian Ė I definitely would pay rent for my parents; however, they would never accept. If they do so, they would probably save that money for me latter.

If you do choose to stay with them, paying them regularly would be the right thing to do, even if they sock it all away and give it to you as a housewarming present. Then, at least, it's their choice (save it for you, vs. spend it on the extra expenses of having you live there).

FeynmanFan knows what's up, though.

Roots&Wings

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Re: Living with parents vs Rent vs Super Rent
« Reply #11 on: December 29, 2014, 02:53:11 PM »
And if your parents would not accept rent money, there are many other ways to chip in like purchasing the groceries/household supplies, making meals, cleaning, home maintenance/repair tasks, paying the utilities, etc.

MrSapolio

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Re: Living with parents vs Rent vs Super Rent
« Reply #12 on: December 29, 2014, 03:14:59 PM »
And if your parents would not accept rent money, there are many other ways to chip in like purchasing the groceries/household supplies, making meals, cleaning, home maintenance/repair tasks, paying the utilities, etc.

That's the point. I actually bought a lot of new items for them. For instance, they use to have an old tube TV and bought a brand new 47Ē LED TV. For my mom, I bought an AC machine (as you can tell, our city is very very hot during the summer). I regularly go to the supermarket to buy the groceries. Another reason they will never accept rent payment from me.

Financially, having my parents as house mates everybody would win. They donít have a great income (I make 3-4 times more than them) because my father is retired and my mother never worked outside. During the week, I spend the entire day outside, arrive from work and go to the gym. Get some dinner and go to my bedroom.

During my master and my phd I lived in a different city/country and I am returning to my home city after 8 years living by myself. Before accepting this job, I used to work for another multinational company, but my current job seems more promising in the long term. Thatís the reason why I have changed.

I get very tempted by staying at my parentsí house, especially after doing some basic math: itís incredible looking those numbers after considering saving 80% of your salary.

HattyT

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Re: Living with parents vs Rent vs Super Rent
« Reply #13 on: December 29, 2014, 04:00:55 PM »
Please know that Americans donít believe in living with parents. They donít believe a person can be an independent autonomous adult when living with parents. 
Many of us have found that multi-generational families can be beyond great when it works.
I vote for door number 1, with your parents.  Live at home for as long as it works for you and your parents.  Save the money.  To up the autonomous, independent adult points, Iíd recommend doing your own laundry though.  And make meals for them a few times a week.  And clean the bathrooms.  And definitely pay rent.  If they wonít take a reasonable amount, put it aside yourself.  Youíd be doing that in your own place anyway and you want the deal to work for them too.  Expect to spend money on privacy, to hang out with friends depending on the hospitality of your parents and the compatibility of your friends.
Your stache will be nice and fat and ready if and when you need to move out for more privacy. When/if that day comes, remember most Mustachians with goals are able to live without pools.  Many live without extra bedrooms - you can set up your laptop in another room.
Some live without Air conditioning - although this can depend on climate and health factors. 
As FutureNurse says, weigh all these factors against your FI numbers and goals.  If you love your job and you are saving more than 50%  then I say you can up your comfort and wants on your priority list.

SunshineGirl

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Re: Living with parents vs Rent vs Super Rent
« Reply #14 on: December 29, 2014, 04:06:41 PM »
I vote for option number three.

annegables

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Re: Living with parents vs Rent vs Super Rent
« Reply #15 on: December 29, 2014, 04:11:27 PM »
This opinion is coming from someone from USA...  My BIL lived with his parents completely free for 10 years after graduating high school.  He had a good job but never paid rent, groceries, utilities, etc.  He never cooked or did his own laundry or even cleaned his room.  He unknowingly took complete advantage of his parents who both work full time and dont make that much money.  It is very frustrating as siblings to watch this, especially when no one would talk about it.  After repeatedly hearing about how much money he was saving, I finally asked BIL if he knew that the 6 gallons of milk he drank a week cost his parents almost $80/month.  After that, he wised up and started paying for the food he ate.  Whatever you do, dont be that guy.  His new wife married a functional teenager.

MBot

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Re: Living with parents vs Rent vs Super Rent
« Reply #16 on: December 29, 2014, 07:07:36 PM »
And if your parents would not accept rent money, there are many other ways to chip in like purchasing the groceries/household supplies, making meals, cleaning, home maintenance/repair tasks, paying the utilities, etc.

That's the point. I actually bought a lot of new items for them. For instance, they use to have an old tube TV and bought a brand new 47Ē LED TV. For my mom, I bought an AC machine (as you can tell, our city is very very hot during the summer). I regularly go to the supermarket to buy the groceries. Another reason they will never accept rent payment from me.

Financially, having my parents as house mates everybody would win. They donít have a great income (I make 3-4 times more than them) because my father is retired and my mother never worked outside. During the week, I spend the entire day outside, arrive from work and go to the gym. Get some dinner and go to my bedroom.

During my master and my phd I lived in a different city/country and I am returning to my home city after 8 years living by myself. Before accepting this job, I used to work for another multinational company, but my current job seems more promising in the long term. Thatís the reason why I have changed.

I get very tempted by staying at my parentsí house, especially after doing some basic math: itís incredible looking those numbers after considering saving 80% of your salary.

Living with parents can make sense - but how do you do that without regressing or giving up your "adult" status. You have lived on your own and can function on your own, so you don't need to live alone to learn or prove that.

It could be beneficial to your parents to have you live with them, but how would you guarantee that?

If it is a good arrangement privacy-wise, and it financially benefits (and does not drain) them as well as you, it could work out well.

My question would be this: If you were to stay with your parents, how would you regularly (monthly?) contribute a set amount of work and money towards the household that they would accept, and would actually benefit them?

For money, Maybe that means purchasing all the groceries as well as picking them up. Maybe it means paying insurance on a vehicle for them. But there may be a regular/monthly/bill you could contribute to they would accept, and that would meaningfully benefit them.

For work, are you comfortable doing your own laundry and preparing dinner once a week? Is there weekly/monthly yard work you can agree to do? Maybe your mom likes making food and doing laundry. I'd ask - and find a few things - that you can work at, as part of the household, as an adult. Contributing is more than just money.

Roots&Wings

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Re: Living with parents vs Rent vs Super Rent
« Reply #17 on: December 30, 2014, 07:43:16 AM »
My question would be: what living arrangement will align best with your goals (financial and otherwise) and make you happiest?  No need to respond to the group, but perhaps something to reflect on :)

You're currently single and recently moved back home.  Are you hoping for a family down the road?  Hoping to buy your own place?  Will saving more by living at home enable or hinder your long-term goals?  Will the 35 min. commute get old fast?

And try to ignore the noise of the typical American who thinks anyone who lives at home is a loser/freeloader.  You've got a great job and great options - all the best!

TerriM

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Re: Living with parents vs Rent vs Super Rent
« Reply #18 on: December 30, 2014, 08:30:08 AM »
I get very tempted by staying at my parentsí house, especially after doing some basic math: itís incredible looking those numbers after considering saving 80% of your salary.

MrSapolio, if you are all very comfortable with the arrangement for you to be home and help pay some of the bills, I think you should do so.  Keep in mind that in the US, staying with parents is viewed as a failure by many.  I'd guess that it is not that way in Brazil.

MrSapolio

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Re: Living with parents vs Rent vs Super Rent
« Reply #19 on: December 30, 2014, 10:31:08 AM »
Are you hoping for a family down the road?
No, I don't want to have kids. Maybe a wife. Maybe.

Hoping to buy your own place?
Definitely no. Brazil is facing a real estate bubble similar to the one experienced in US in 2008. I have no idea when the prices are going back to "normal". The rent return is 0.25% right now. You can get easily an interest rate of 1% a month in a very safe investment.

Will saving more by living at home enable or hinder your long-term goals?
Yes. Saving 80% instead of 65% or 50% is huge.

Will the 35 min. commute get old fast?
That's the biggest problem. I can try get up early and go to the gym, avoiding traffic (15 min. faster).

"Keep in mind that in the US, staying with parents is viewed as a failure by many.  I'd guess that it is not that way in Brazil."
Yeah, here in Brazil it is not a big deal. If someone stays with parents and does not have a job, it is bad. But, I (and also my parents) never cared about what the others thinks about us.

CommonCents

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Re: Living with parents vs Rent vs Super Rent
« Reply #20 on: December 30, 2014, 10:49:00 AM »
And try to ignore the noise of the typical American who thinks anyone who lives at home is a loser/freeloader.  You've got a great job and great options - all the best!

It's hard to avoid thinking that when his initial post presented the story as mom/dad do the cooking and laundry.  Implicit was that they also do the cleaning.  I'm not sure how it can be seen as any way BUT freeloading if he's not contributing money or time, or less than minimally the money and time being at home would cost his parents.

OP, you know that 3 is not mustachian, so I'm little unclear why you'd ask for blessings on it.  (If you must have the pool, just do it w/o asking if it's ok.)  You know that 1 *as presented* is taking advantage of your parents.  Consider 2, or reworking 1 (to contribute more), 3 (to have a roommate) or a new idea.  Also keep in mind you can do any option for a time period and then choose something else.