Moving back in with your parents to save money is nothing new. The new twist is that some middle-aged adults are the ones making the move back home.

The phenomenon was detailed in this recent article. While these adults may not be the recent college graduates that often live with their parents to get a clean start, their reasons for the move are the same: lack of money.

With a lagging economy, softening job security, and people continuing to live beyond their means, some people are left with few other options than returning to the care of their parents. While the financial benefits of living with your parents may be great for you, it is likely putting a strain on their finances. Every dollar they spend to support you is one that they cannot spend on themselves in retirement. Many parents would never turn away a child in need, and that is understandable. In fact, it may be that poorly educating their children about money is one of the reasons why the “kids” are in financial trouble to begin with. Financial support should have its limits though, and should be temporary in nature.

Seeing this trend of middle-aged adults returning home should also serve as a reminder of the importance of saving for your retirement. People who plan to receive support from their grown children may be in big trouble. While most people would like to help their parents, or children, poor financial health makes either type of help difficult if not impossible. Helping others is admirable but should only be done if it truly helps the person in need, rather than enable their poor habits to continue.

A reverse mortgage is a loan against a home’s equity that doesn’t need to be paid back until the homeowner dies, sells the home, or moves out. Available to homeowners age 62 and older, it can be paid in a lump sum or in monthly installments. There are benefits to using a reverse mortgage, but there are downsides as well. Many homeowners, particularly those with good credit, can often find less expensive alternatives.

The main reason people use a reverse mortgage is that they get to stay in their home for as long as they wish. As stated above, no payments are required while you remain in your home, though the balance due does rise as more payouts are made and interest accrues. If home prices rise at a significantly higher rate than interest on the loan, then reverse mortgages can be affordable. Of course, as the recent housing downturn has shown, prices don’t always rise. Another reason people use reverse mortgages is that you can usually get one if you have equity in your home, regardless of your credit. This may be a reason for people with poor credit to use them, but it doesn’t mean they are the best option for everyone.

The main downside of a reverse mortgage is the high upfront costs. Wikipedia reports that

For the most popular type of reverse mortgage in the U.S., there is an insurance premium of 2% of the loan and a 2% origination fee in addition to normal closing costs.

Interest rates tend to be adjustable, as the duration of the loan is unknown. Rates are reset on a regular basis, as often as every month.

As mentioned above, reverse mortgages are available to homeowners aged 62 or older. As such, the senior citizen advocacy group American Association of Retired Persons (AARP) has covered the topic at length. To get you started, see their brief discussion of 5 questions to ask before considering a reverse mortgage, listed below.

1. Do you really need a reverse mortgage?
2. Can you afford a reverse mortgage?
3. Can you afford to start using up your home equity now?
4. Do you have less costly options?
5. Do you fully understand how these loans work?

This is just an overview of reverse mortgages. In addition to answering the above questions from the AARP, I urge anyone thinking of using a reverse mortgage to thoroughly research them, and other options, before making a decision. Reverse mortgages are one option, but for many people there may be more affordable alternatives.

With the credit market still tied up tighter than Houdini, access to capital by traditional means (read: your bank) is tough to come by. Here are some tips to help you entrepreneurs out there raise money – without going to those suits at your bank:

Tap your network

Raising angel money is all about who you know. Networking with other start-ups, mentors, old college professors...these contacts can lead to potential investors in your new company. While a bank office might laugh at your Facebook/Digg/YouTube gadget, a savvy angel might just see what you see: a future Yahoo! or Google property...

Have a business plan that's not just in your head

A well-written business plan is important to some investors. Some won't care if it's written on a napkin or just in your head, but many will want to see a well thought-out, written down plan of what you intend to do with their money. Even though your plan might go out the window as your company grows, it's important to have one to cover all your bases.

Don't focus on the financials

When pitching VC's, don't spend an hour going over every detail of your pro-forma income statement. They know numbers 10x better than you do, and they will rip you to shreds. Focus on what you know best: your idea or product. Emphasize the market potential of your idea, and let the suits crunch the numbers. The numbers you should know? Your burn rate. If you can't tell an investor how much cash you expect to burn each month, you'll be in for quite the grilling.

Clean up your (personal) credit

While it's best to not personally guarantee business loans, sometimes it's just not possible to get business credit without a personal guarantee. This means your personal credit score needs to be at least in the mid to high 600's to have any chance of approval. Pay down any credit cards you can, and look at social lending as a way to get the best rate for a consolidation loan. When you do apply for credit, take a shotgun approach and send in multiple applications within a short period of time to improve your chances.

Establish business credit

Business credit, while similar to personal credit, must be established completely separately from your personal credit file. Credit is obtained under your business' EIN number. Gas credit cards are a good first step (and easy to get approved for) in establishing your credit. Also, make sure you get a DUNS number, and check your Experian business score (which ranges from 0 to 100). By starting to establish your business credit as soon as possible, you'll be well positioned down the road should you ever want to apply for that bank loan.

Raise money before you need it

The best time to raise money is when it's not absolutely needed. If your business is already profitable and you just want to take it to the next level, that's a great time to raise money. When you're broke, losing money, and have vendors calling you for payments...that's the worst time to raise money.

Always be thrifty (and always be closing)

Investors or banks want to see that you're not wasteful with the money you already have before they give you more. Pick up cheap office furniture off craigslist. Keep your salary reasonable, nothing extravagant (too low and investors will nitpick, so be careful there). Don't get office space until you absolutely need it; for many start-ups your basement or local coffee shop will do just fine.

And always be closing!

What is the one, biggest asset that most people have, which many people including you may not even realize is an asset? If you look at your life as a financial system, with assets causing money to “flow into” your life, you will want to pay attention, as this post will be about your biggest asset and what you can do with it.

The biggest asset that most people have, including you, is their earning ability. It is your ability to go out into the work force and be paid wages for value that you contribute to any organization. Many people do not view this as an asset, but when they are laid off or without a job for any other reason they quickly realize how much money they were earning and bringing into their lives.

According to the U.S. Census Bureau (pdf), an average person with “some college” and no college degree will earn $1.5 million in the United States. A person with a Bachelor’s degree will earn $600,000 more, for a total of $2.1 million. This is not a small amount of change; this is the biggest income producing asset for most people.

Realizing that the income you earn is coming from an asset is an important concept. This is not money that should be all spent before the next paycheck. Rather, you should convert this income into other assets. Cutting spending and putting more money into savings and investments is one way of doing this. Buying term life insurance is another way to protect your income if a family depends on that income.

The personal savings rate averaged less than one percent for the last two years across the United States, which means that if you start saving 2%, 5% or even 10% of your income, you will be better off than most everybody in this country. And the sooner you do that, the more of that income from your earning ability can be converted to other real assets.

Reducing our finances to their simplest form, we are left with income and expenses. Increasing income is often time consuming and somewhat out of our control. That leaves expenses as the variable that can be changed to improve our finances. If you are looking to spend less, try this two-step plan before making any large purchases.

Step 1: Write down why you want to buy something

If you can’t fill out a piece of paper with your reasons for making a purchase, then you probably don’t need the item. Try to be as specific as possible. A reason like “It will help me to live a more productive lifestyle because of …” Is a better reason than “It’s cool so I want it.” See how many reasons you can come up with. If you have reasons against the purchase, you can write them down as well. Having more than one or two reasons against a purchase probably means that you already know that the item is unnecessary.

Step 2: Wait a week before buying

After a week, review your list. Add or subtract from the list as appropriate. You may miss out on a sale as a result of this method, but that may allow you to take another reason off your list. “I want to buy it because it’s on sale” isn’t a good reason for making a purchase to begin with. If you are still convinced that you should buy the item at this point, then go ahead and buy it.

While these steps can help you to make smarter purchasing decisions in the future, they won’t help with poor decisions you may have made in the past. To help resolve those, you can try to consolidate your debt and get back on the right track.

Using the two step plan, you’ll probably find yourself much less likely to buy items that you really don’t need. Both steps help to reduce impulse buying by adding gates between you and the purchase. Those items that do make it past both steps will leave you with a satisfaction that overspending could never hope to provide.