How to help your kids buy a home without short-changing your retirement

Home ownership used to be a milestone. For many young Australians, it now feels like a miracle – and more parents are stepping in to help their children turn their dreams into a reality. 

The so-called “Bank of Mum and Dad” is estimated to have grown into a $35 billion force¹, large enough that if it was an actual bank it would rank among the nation’s top lenders². Around more than six out of ten first-home buyers receive parental help¹, often a gift or “informal loan” averaging more than $70,000³.  

Behind this generosity lies a growing financial strain: more than half of parents draw on savings⁴, while others may dip into super or even delay retirement to make it happen. It’s natural to want the best for your children, but good intentions are no substitute for good planning. With the right strategy, you can help your kids without putting your own retirement at risk. 

Plan early and structure your support 

The best time to plan is before your children ask for help. Too often, parents step in once house-hunting has already begun, leaving little time to prepare or build the resources needed. 

Planning early can give you more control and let you approach support strategically rather than reactively. 

Start by setting aside small, regular contributions. Even modest amounts can grow significantly over time when invested in diversified, long-term saving vehicles. For example, putting aside up to $400 a month from age 35 could generate a meaningful contribution by the time your child is ready to buy. The principle is simple: early, disciplined planning can create a buffer, while last-minute support may often mean scrambling resources or dipping into retirement savings. 

Increasingly, families are taking a more structured approach to this challenge, setting aside funds early for major milestones such as a first home. Whatever the approach – whether through a family trust, managed fund, or dedicated savings plan – the key is discipline: keeping money earmarked for children separate from the wealth you’ll rely on in retirement. 

Keep your money within reach 

Structure is important, but flexibility is vital. Putting too much into property too soon can make it hard to adapt when life doesn’t go to plan. It’s the classic dilemma: being asset-rich but cash-poor. 

Property may feel safe – tangible and familiar – but it can also limit your options. It can be expensive to buy, slow to sell and costly to maintain. When the unexpected happens, you can’t sell a spare bedroom to free up cash. 

Maintaining a portion of your wealth in accessible, diversified investments can provide valuable flexibility. For some families, this might mean balancing property with other structures – such as managed funds, ETFs, term deposits or long-term investment vehicles like investment bonds, which can offer more ready access to resources should circumstances change. This way, you can support your children without permanently locking away funds you might need later. Because when interest rates rise, medical bills appear or life takes a turn, having liquidity can keep your plans on track.

Think beyond the purchase price

Helping your child with a deposit is only part of the story. Stamp duty, legal fees, maintenance, and insurance quickly add up, and many parents underestimate these costs. 

One Australian couple learned this the hard way. After gifting their daughter a deposit, they found themselves covering strata fees and repairs when she lost work. What began as a helping hand, soon tested their own financial plans.  

Setting aside a flexible pool of savings – spread across accessible, long-term investments – can make generosity more sustainable. The aim isn’t just to help with the purchase, but to be ready for what comes next. 

Balance family expectations

Helping one child into the market can take years of savings - and doing the same for each isn’t always realistic. The challenge isn’t just financial; it’s emotional. Uneven support can create quiet tensions, despite best intentions. 

Clear communication matters as much as generosity. Setting expectations early helps prevent resentments and keeps the focus on opportunities, not comparisons by children. Fairness doesn’t have to mean equal dollars – some parents might help one child with a deposit and another with education or childcare costs. What matters is consistency and intent, so every decision supports your goals and strengthens family bonds. 

Be generous - but be strategic

The “Bank of Mum and Dad” isn’t closing any time soon, but it is evolving. True support isn’t about how much parents give, but how thoughtfully it’s planned and sustained. When generosity is backed by structure and clever foresight, it can strengthen the family’s financial position instead of stretching it. 

That’s the balance modern families are learning to strike – helping the next generation move forward, while keeping their own footing secure. 

Learn more

Are you an investor?

Talk to your financial adviser about how Generation Life’s Investment Bonds can help you support your children’s property goals – without compromising your own retirement plans.

1 Finger: ‘Bank of Mum and Dad statistics 2023’: https://www.finder.com.au/home-loans/bank-of-mum-and-dad Accessed October 2025.

2 University of Newcastle: ‘The ‘Bank of Mum and Dad’ is exposing older Australians to the risk of financial abuse’: https://www.newcastle.edu.au/hippocampus/story/2024/the-bank-of-mum-and-dad Accessed October 2025.

3 Mozo Bank of Mum and Dad Report 2025: ‘The Gift of Mum and Dad: From loans to legacies’: https://cdn.mozo.com.au/pdf/bank-of-mum-and-dad-report-2025.pdf Accessed October 2025.

4 Mozo: ‘Forget loans – the ‘Bank of Mum and Dad’ has become the ‘Gift of Mum and Dad’: https://mozo.com.au/reports/bank-of-mum-and-dad-report-2025 Accessed October 2025.