Abstract

As the share of U.S. adult children living with their parents increases, it is important to understand how children who “boomerang” back home impact their parents in their pre- retirement and post-retirement years. We use data from the Health and Retirement Study (HRS) to examine the effects of boomerang children on their parents’ labor market expectations and choices, as well as on their wealth, health, and life satisfaction. Event study analysis suggests that boomerang children return home due to short-term instabilities, such as negative shocks to marriage, income, and employment. We find that boomerang children are associated with a small increase in their parents’ subjective probability of working after age 65. However, there is no clear statistically significant evidence that they impact parents’ current or future labor market choices; nor is there any evidence that they affect parents’ wealth, health, or life satisfaction.