Supporting Adult Children Financially: Finding Balance Without Sacrificing Your Future
As parents, your desire to help your children succeed doesn’t end when they turn 18. In fact, in today’s challenging economic climate, more than half of parents continue to provide financial support to their adult children. With soaring housing prices, rising living costs, and increasing financial pressures, it’s no surprise that young adults often need a helping hand.
But while supporting your child is natural, it’s essential to do so in a way that doesn’t compromise your long-term financial security—especially your retirement plans.
Why Financial Support Is More Common Than Ever
Today’s economic landscape makes it harder for young people to achieve financial independence. Key challenges include:
Unaffordable housing markets – Deposit requirements are out of reach for many.
Stagnant wages vs. inflation – Cost of living continues to rise faster than income growth.
Student debt and job market volatility – Many graduates face financial hurdles early on.
Given these realities, parental support has become a lifeline for many. But how can you help—without putting your own future at risk?
Striking the Right Balance: Help Without Harm
The key is informed, intentional support. Before offering financial assistance, take stock of your own financial health:
Are your retirement savings on track?
Do you have an emergency fund?
Can you afford to give or lend money without impacting your lifestyle?
Having a clear picture of your finances ensures any support you provide is sustainable and doesn’t jeopardise your long-term goals.
Smart Ways to Support Your Adult Children
There are several effective—and responsible—ways to help your child build financial stability:
1. Gift Funds (With Tax Awareness)
If you’re in a position to help, gifting a portion of a home deposit can be a game-changer. However, be aware of potential tax implications, such as:
Always consult a financial advisor to ensure compliance and optimise outcomes.
2. Act as a Guarantor (Use Home Equity Wisely)
Using the equity in your home to guarantee your child’s mortgage can help them enter the property market sooner and avoid lenders mortgage insurance (LMI). But this comes with risks:
Open conversations and legal agreements are crucial to protect both parties.
3. Co-Ownership: Invest Together
Buying a property jointly allows you to share costs, deposits, and responsibilities. A formal co-ownership agreement should outline:
This approach can be mutually beneficial—if structured correctly.
4. Non-Financial Support: Build Financial Literacy
Sometimes the best support isn’t monetary. Empower your children by:
Teaching budgeting, saving, and investing basics
Encouraging smart credit habits
Including them in family financial discussions
These skills lay the foundation for lifelong financial independence.
Plan with Purpose: Tailored Advice for Your Family
Every family’s situation is unique. What works for one may not suit another. That’s why personalised financial planning is essential.
We can help you:
Assess your current financial position
Explore support options that align with your goals
Create a sustainable strategy that supports your child and protects your retirement
Final Thoughts: Support That Lasts
Helping your child succeed is a powerful expression of love—but it shouldn’t come at the cost of your own financial wellbeing. With careful planning, transparency, and professional guidance, you can provide meaningful support while staying on track for a secure, stress-free retirement.
Need Help Planning?Speak with a qualified financial advisor to explore options tailored to your family’s needs. Let’s build a future where both you and your children thrive—without compromise.
Call Gardian Financial Planning in Mackay today at 07-4957-7424 to get started.
Disclaimer: This article is for general information only and does not consider your personal financial objectives, situation, or needs. Always seek professional advice before making financial decisions.
