As parents, the instinct to support our children never truly fades, even when they become adults. However, it's important to ensure that any financial support you provide does not come at the expense of your own financial future.
Support in a Challenging Environment: In today's financial landscape, many young people struggle to get ahead due to skyrocketing housing prices and rising living costs. More than half of parents with a child older than 18 provide financial support.
Achieving Balance: The challenge is balancing helping your kids get a head start in life while ensuring you have enough for a secure financial future. Have clear visibility of your own financial situation and how much you can comfortably spare without compromising your retirement savings.
Ways of Providing Support:
Gift Funds: If you have the means, gift a portion of the deposit, but be mindful of tax implications.
Going Guarantor: Use the equity in your home to guarantee your child's home loan, but discuss potential risks thoroughly.
Co-Ownership: Purchase a property together, sharing financial responsibilities with a clear agreement in place.
Non-Financial Support: Encourage your children to develop good financial habits, such as budgeting, saving, and investing. Involve them in family discussions about money management to empower them to make informed financial decisions.
Navigating the complexities of financial support can be challenging. We can provide assistance and advice tailored to your unique situation, helping you create a sustainable plan that allows you to assist your children without compromising your retirement goals.
All information included in this blog does not take into account any personal objectives, circumstances or needs. It is intended as factual information only. Before acting on any information, we suggest you seek personal financial advice. You may opt to contact Gardian Financial Planning at 07-4957-7424 or email us at fp@gardian.com.au.
