According to Minnesota Public Radio (MPR), since the global COVID pandemic, the “number of multigenerational households in the United States recently jumped from one in five to one in four. That’s more than 66 million American adults living in multigenerational homes.” So, why the massive jump?
Well, one big reason is that Americans are living longer! Many members of Gen X are finding themselves part of a “sandwich generation,” meaning they are caring for aging parents and their own children or young adults in the home, simultaneously. Minnesotans, like many of their neighboring states, have also found that living together, under one roof, means financial savings. And in an economy where many households are pinching pennies, it sometimes makes financial sense to bring generations together.
So what can multi-generational living mean for your insurance costs? With careful planning and research, you can, in fact, save money here, too. Let’s take a deeper dive into what this may mean for your bottom line.
Homeowners’ or Renters’ Insurance
Whether you own your own home or rent a living space, having one household means saving on that insurance policy. Rather than having a grandparents’ home, parents’ home, and soon adult children’s homes, all insured separately, living under one roof means you’re all under one policy. By simple math, strictly reducing the number of policies needed means savings.
It should be noted, however, that when calculating your needs, especially if the move-in was recent, you may now have more valuables, belongings, and/or structures to consider insuring. Ensure that all household members have been considered, so that any homeowners‘ or renters’ insurance policy adequately covers all belongings.
Car Insurance Costs
Keep in mind that most insurance carriers require you to inform them of all licensed drivers living in the household, in order to keep your coverage, so make sure you are updating your policies accordingly if you have had additional adults recently move into your house.
Adding people to your policy can also result in overall savings, since each adult will no longer have to carry their own insurance cost. While it is company policy-specific, many carriers offer a “bundle” discount, meaning the more drivers you have under the same umbrella, the more you can save. Since this is a single household, many companies will consider multi-generational families as a single household. This means you can save more by bundling car insurance policies.
If you have two grandparents driving, two parents, and teen/adult children as they become of driving age, you can be under the same policy, and take advantage of the bundle savings.
Life Insurance Needs
The third major type of insurance to consider is life insurance. In this case, you could be looking at savings or an increased cost, depending on your situation.
On the one hand, the aforementioned “bundling” can mean savings. If each individual in the home has a policy (no matter their age) under the same organization, you can save by “buying in bulk,” so to speak, saving due to quantity.
However, if you are the sole breadwinner in a multigenerational household, you may need a higher payout policy. More lives are depending on you to pay the monthly bills. From the home itself, to utilities, insurance, and care, there are many financial needs to consider should you no longer be here. Ensure your coverage accounts for this increase.
Planning Ahead is Key
Regardless of your living arrangement, planning is the best way to achieve a healthy financial future. From estate planning to insurance needs, basic monthly budgets, and mapping out the best routes to retirement, it is smart to have an experienced partner helping you along the way.
My team is here to help you with the insurance piece of the puzzle, while my wife, Gretchen Rehm, and her experienced associates can assist with the rest of the financial ins and outs through her firm. Discover how we can collaborate to support your financial well-being.
