Balance generosity with financial security. Helping children or grandchildren financially can make a meaningful difference, but it shouldn’t compromise your retirement lifestyle or long-term financial independence.
11 November, 2026
Are you helping your children financially?
First Financial Team
The cost of living, interest rates and housing prices are the big three issues facing most Australians. For younger people, especially those starting their adult years, the future their parents had feels out of reach. A generation ago, a common complaint was that young people wanted to start where their parents finished. Today, many can’t see a way to start at all. Younger Australians are experiencing a different financial landscape from previous generations.
The Australian Government’s 2026 Intergenerational Report highlights this growing divide. It estimates that approximately 250,000 additional households aged 25–34 would own their homes if home ownership rates had remained at their 1981 levels.
For parents and grandparents who have accumulated wealth, this raises an important question. Should you help your family financially now, rather than leaving everything through your estate?
"Younger Australians are experiencing a different financial landscape from previous generations."
The changing face of family financial support
Traditionally, wealth has passed between generations through inheritances. However, increasing numbers of families are considering providing financial assistance while parents or grandparents are still alive.
This can take several forms, such as contributing to a home deposit, education expenses, providing an interest-free loan, or assisting with unexpected financial pressures. Regardless of the intention, earlier financial support can make a meaningful difference, particularly when younger family members are establishing careers, purchasing homes, or raising children.
The consideration is balancing your generosity against your own financial circumstances.
The first question is: can you afford to help?
We all want to help our children or grandchildren, but before providing financial assistance, it’s important to understand how the decision will affect your retirement. Australians are living longer, meaning retirement savings may need to support 25 to 30 years of living expenses. While your current financial position might appear comfortable, future requirements, including health and aged care, home maintenance and changing lifestyle needs, must be examined.
Consider how a significant financial gift might affect your investment portfolio, retirement income and capacity to manage unexpected expenses. The First Financial team provides financial modelling to illustrate different scenarios, including the longer-term consequences of transferring assets today.
The objective is to support family members without compromising your own financial independence.
Financial gifts versus family loans
There are several ways to provide financial assistance, and each carries different considerations.
A financial gift transfers money without an expectation of repayment. This may be appropriate when parents have sufficient resources and want to help children establish themselves. Alternatively, a family loan provides financial assistance under an agreed repayment arrangement.
Loans can offer greater flexibility and may help protect family wealth, particularly when properly documented. A written agreement clarifies the amount advanced, repayment terms, interest arrangements and what happens if circumstances change.
Legal advice is recommended where substantial amounts are involved, especially if relationships break down or family circumstances become complicated.
Understanding tax and Centrelink implications
Australia generally doesn’t impose a separate gift tax on money given to family members. However, transferring certain assets rather than cash can trigger capital gains tax or other financial consequences.
For people receiving or expecting to receive the Age Pension, gifting rules also warrant careful consideration. Centrelink generally allows gifts of up to $10,000 in a financial year, subject to a maximum of $30,000 over five financial years, with any excess not assessed under the deprivation rules. Amounts exceeding these limits may continue to count towards income and assets assessments for five years.
There are also family dynamics to consider. Providing financial assistance to one child or grandchild may raise questions about fairness within the family. For example, helping one purchase a property while another remains financially independent may create expectations about future inheritances.
Estate planning arrangements may need to be reviewed to reflect substantial financial assistance already provided. An updated will and appropriate legal advice can help ensure your intentions are understood and implemented.
Helping the next generation can be personally rewarding and financially meaningful. We recommend making the decision as part of a complete financial plan.
A First Financial adviser can help assess the potential impact of different approaches. Ultimately, successful intergenerational wealth planning is about finding a balance between helping the people you care about and protecting your own financial security.
“Successful intergenerational wealth planning is about finding a balance between helping the people you care about and protecting your own financial security.”
The financial advice experts
The team at First Financial comprises financial experts who help hundreds of Australians retire well and make informed, intelligent financial decisions. We cover everything from retirement and financial advice, investment and wealth management, superannuation and SMSF, insurance, tax, aged care, legal and lending services.
Contact us for holistic, well-rounded financial management strategies.
Key Takeaways
Consider gifts versus family loans. Financial assistance can take several forms, including outright gifts and structured family loans. Understanding the benefits and implications of each approach is essential.
Understand tax, Centrelink and estate planning implications. Providing substantial financial assistance may affect Age Pension entitlements, trigger tax considerations or create questions about fairness and future inheritances.
Make family financial support part of your broader financial plan. Professional financial advice can help you assess different scenarios, support the next generation and protect your financial future.
YOUR FINANCIAL JOURNEY
Building your financial future
Every client journey begins with a conversation. We look closely at where you are now, what matters to you, and what’s possible. Then we structure our advice to match.
Financial
Roadmap
A clear, personalised path to your financial goals.
Tax
Efficiency
Proactive strategies to maximise your tax savings.
Personalised
Investing
Tailored plans aligned with your goals and risk profile.
Ongoing
Support
Regular guidance to keep your plan on track.
CLIENT STORY
Graeme and Craig
Life Stage:
Retired and semi-retired
Background:
Referred by friends who were helped through aged care, Craig sought secure financial guidance after inheriting funds.
- Invest inheritance securely without high risk
- Maintain a modest lifestyle with confidence
- Building trust for someone new to advice
- Accessible, personalised advice
- Provided a low-risk strategy with regular income
- Reassured with steady, market-aware updates
- Established trust through responsiveness and warmth
- Delivered calm, expert support through all transitions
“We feel very secure with First Financial, the income just comes in, and we know everything is being looked after. It’s not just safe, it’s smart. We’ve recommended them to others because we genuinely believe in the team.”
CLIENT STORY
Larry and Virginia
Life Stage:
Newly retired
Background:
As retirement neared, Larry and Virginia were ready to enjoy travel, family, and freedom, without uncertainty. A friend recommended First Financial, and from the first meeting, they had a clear plan, a safety net, and people they trusted.
- Wanted to travel and enjoy retirement without second-guessing finances
- Needed a structured income plan with buffers for the unexpected
- Valued guidance that felt honest and human, not overcomplicated
- Needed people they could call and count on
- Created a reliable income stream with a set-aside safety net for the unexpected
- Gave them the freedom to travel and spend meaningfully with family
- Kept advice simple, thoughtful, and tailored to what mattered to them
- Built a lasting partnership based on trust
“We’ve travelled the world, Europe, Sri Lanka, Vietnam, without once stressing about the money. They made everything feel simple and gave us the confidence to live well. We feel secure because we know exactly where we stand, and that peace of mind means everything.”
CLIENT STORY
Jan
Life Stage:
Retired
Background:
Jan's husband managed the finances until entering aged care. Jan gradually stepped into the financial picture with First Financial’s support.
- Needed financial guidance after business sale
- Lacked experience managing complex finances
- Sought consistent income and long-term structure
- Wanted a familiar, reliable relationship
- Provided long-term support through several transitions
- Helped structure income reliably for retirement
- Empowered Jan through education and reassurance
- Delivered calm advice through both grief and growth
“The money just comes in. I don’t have to think about it. And I know they’re always there. They’ve always been there in the background, just quietly making things work.”
CLIENT STORY
Lyn
Life Stage:
Retired widow
Background:
Lyn stepped into financial management for the first time after her husband's passing. With patience and care, First Financial supported her through grief, learning, and empowerment.
- Had never managed finances before
- Was overwhelmed after her husband’s passing
- Needed plain-English explanations and patience
- Sought emotional support and practical clarity
- Offered caring, respectful advice at her pace
- Rebuilt confidence with diagrams, stories, and reassurance
- Supported gradual decision-making around retirement
- Remained a trusted constant through major transitions
“After my husband passed, I was completely unsure where to start. First Financial gave me the space to learn, to ask questions, to grow confident. They drew a diagram that I still have. And now, I sleep well at night knowing I’ve got someone in my corner.”
CLIENT STORY
John
Life Stage:
Retired business owner
Background:
After decades of running a successful pharmacy, John sought financial guidance to simplify decision-making and support long-term planning.
- Navigated the sale of a long-held business
- Wanted simple, honest advice after burnout
- Needed a hands-on adviser he could talk to
- Desired financial guidance aligned with lifestyle goals
- Crafted a strategy that supports relaxed, post-work life
- Offered approachable, plain-English advice
- Maintained an ongoing, trustworthy relationship
- Provided flexibility with investments and cash flow
“I feel genuinely supported by First Financial. I can ask anything, and there’s no pressure, just clear advice and real care. The money’s growing, I’m not stressed about it, and I feel completely at ease for the first time. I don’t miss work, but I’d miss the support I get from First Financial.”
CLIENT STORY
Tim and Adam
Life Stage:
Early retirement and working professional
Background:
When Tim received an overseas medical settlement, he and Adam had just 14 days left in a 90-day window. They needed clear guidance, fast. A referral led them to First Financial.
- Only two weeks left to meet urgent legal and financial deadlines
- Wanted to preserve capital while setting up income for the future
- Needed a plan that supported both retirement and ongoing work
- Hoped to find advice that felt personal, not transactional
- Managed every moving piece, from legal documents to super rollovers
- Designed a strategy that supported both Tim’s retirement and Adam’s career
- Offered clear guidance with steady follow-through, with no stress or pressure
- Built in ethical investing and flexibility, without sacrificing performance
“We’re in totally different life stages, but First Financial built a strategy that supports us both. From urgent legal steps to ethical investing, they handled every detail with calm, care, and real expertise. It’s financial freedom without compromise, and we couldn’t have done it without them.”
Meet our advisers
Frequently Asked Questions
How can parents help their children financially?
Parents can assist their children by contributing towards a home deposit, paying education expenses, providing an interest-free family loan or helping with unexpected costs. The most appropriate approach depends on the parents’ financial circumstances and their children’s needs.
Should I help my children financially before leaving them an inheritance?
Providing financial assistance during your lifetime can help your children when they need it most, particularly when they are purchasing their first home or raising a family. However, it’s important to ensure that providing support now won’t compromise your retirement income or long-term financial security.
How much money can I afford to give my children?
The amount you can comfortably provide depends on your retirement savings, income, investments and anticipated future expenses. Financial modelling can help determine how a substantial gift might affect your ability to fund retirement, aged care and unexpected costs.
Is it better to give my children money as a gift or a loan?
A financial gift provides assistance without requiring repayment, while a family loan allows parents to establish repayment arrangements. Family loans should be properly documented to protect everyone involved and minimise potential misunderstandings or disputes.
Do I have to pay tax when gifting money to my children in Australia?
Australia generally doesn’t impose a separate gift tax on cash transferred between family members. However, gifting assets such as investment properties or shares may trigger capital gains tax or other financial consequences.
Will giving money to my children affect my Age Pension?
Centrelink’s gifting rules generally allow you to give away up to $10,000 in one financial year, subject to a maximum of $30,000 over five financial years, without the excess being assessed under deprivation rules. Amounts exceeding these thresholds may continue to be included in your income and assets assessments for five years.
How can I ensure financial assistance is fair between my children?
Providing substantial financial assistance to one child can create concerns about fairness, particularly when other children receive different levels of support. Open family discussions, clear documentation and reviewing your estate planning arrangements can help ensure your intentions are understood.
How can First Financial help with intergenerational wealth planning?
First Financial advisers can assess your financial position and model different scenarios to understand how helping your children may affect your retirement and long-term financial security. They can also help coordinate financial and estate planning strategies that balance family support with the protection of your own financial independence.