With multi-generational housing on the rise – aging parents moving in with their adult children — this segment looks at the complex issue from the child's point of view. Elder law attorney Andrea Lee from Legacy Estate Planning joins Suzanne Newman on the Answers for Elders podcast to talk about expectations and approaches.

Andrea says, "There's obviously many ways this can be set up... And the big question that we always want to advise is sitting down and formulating a plan of what that would look like, not just structurally, but emotionally. If mom and dad were to live in there, if mom and dad are investing hundreds of thousands of dollars to modify a house or to add an apartment, then the conversation needs to be had. My recommendation is two kitchens, two living areas. That has been a proven need to make long term care housing happy for everyone, is their home separate space, so you're not constantly in each other's hairs. But the conversation the child needs to have with their parent is, 'hey, if you're investing all this money and you're living with me, both parties need to be protected.' So you have to have a plan.

"What about the time when mom and dad die? What is going to happen with that money they've invested? Do they expect to be put on that deed? Do they expect to earn an ownership interest in that property, or are they going to treat it as a gift to the child and say, 'I'm giving you this $200, $300,000, and my hope is you let me live in this apartment that we're building. That creates a risk for the parent, because what if the kids change their minds after a few years? They don't want mom and dad to live there anymore. If it's a gift, the parents aren't protected. But if the parents own an ownership interest in that house, then it opens the kids up to the possibility of, if mom or dad die, and that becomes a part of their will, or distributed through their trust, might they be in a position where they have to sell their own house to pay off a sibling? You don't want them to be in that position either."

Andrea adds, "Many questions can arise if your parents are thinking of living with you. it's absolutely essential that the parent and the child sit down and discuss these possible scenarios. And because most people only do this once in their life, it is best done if that parent and that child sits down with professionals who have experience guiding families through creating multi-generational housing. So you can discuss the pros and the cons and the risks to the parents and to the child."

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