Why the smart ones still live at home

Recent American college graduates are each year off to the "real world," as the transition from holding a part-time college job for booze money turns into a full-time job with alcohol-related purchases taking back seat to making money for rent and things like - gasp - groceries. These new (boring?) spending habits are probably a good thing, as besides not being very healthy drinking can also be tough on the wallet. But if Americans could look past the hurry to enter the "real world," and ditch the negative stigma that is sometimes attached to "living at home," parents could gift to their recent college grads an extremely valuable present at almost little cost to themselves: the gift of free rent.

It is no secret that rent is expensive. Judging from cities where this author has friends and depending on the roommate situation, living in Austin, Texas could put you out $400-$900 a month, Boston, Massachusetts could stick you $600-$1400 a month, while San Francisco and New York can ruin you for well over $1500. This author has the honor of forfeiting over $2500 per month for a very small apartment in Hong Kong, eight months out of college. These aren't swanky digs (nor are they dingy); these are the types of places you'd expect for a recent grad with an entry-level position. Doing a little math, an annual figure of between $6,000 and and $30,000 could go purely to rent, with a slightly higher opportunity cost thanks to monthly or up-front payments. That's a lot of money.

For the recent four-year graduate interested in attending graduate school, living at home is a reasonable option to save some serious cash, especially if is entry-level employer is unlikely to pay for future schooling. The same holds true for recent grads eager to get a leg-up on their personal savings. Looking beyond the annoying but inevitable late-night questions from the parents and the potential dulling of one's social life, what is that abhorrent about living at home? Home can't be that bad; who knows, maybe without the tuition payments the parents went wacky and invested in new hot tub or car. Yet even without these (unlikely) incentives, with the extra cash a recent grad may have enough money to put an additional $10,000 towards long-term savings and take that long trip overseas to visit a good friend in, say, Hong Kong.

This article isn't calling for the abandonment of life after college, or the forfeiture of independence so many college grads stumble into (and seem to enjoy) after living on the lam. But the economic benefits just seem so painfully obvious that, if a recent grad is comfortable with the idea of moving home after college (and if the parents and siblings can tolerate it), why the stigma for those who choose to do so? Ironically those recent grads may very well be the smart ones; indeed, the $30,000 annually this author pays for 500 square feet of personal space in Hong Kong doesn't include the luxury of a refrigerator that magically restocks itself every time mom goes to the grocery store.

Home sweet home. . .after the tuition payments?