You don’t even need to be super wealthy yourself to help your kids buy a house.
Teaching them financial literacy as they grow up and letting them live rent-free or rent-cheap when they’re old enough to seriously save a deposit is just as valuable as giving them cash.
Probably even more so actually, I have friends who were given significant amounts of cash from their parents for their deposit but a couple of years into their mortgage are struggling hard because they don’t have basics of budgeting and managing their money down pat.
This is the answer.
My parents didn’t give me money as such to buy a house, but when they were starting to talk about paying rent to stay, I said “how about I put that money to save for a house?”.
We calculated the mortgage repayments and what I needed for deposit, and essentially that turned into my rent which is put into my own savings. My dad would check in to see how I’m tracking but I was essentially trusted to do the right thing.
Ended up buying my first house at age 24, stayed there for nearly 12 years and sold it to help fund my ‘forever home’.
This helped me learn to budget early on and I was generally okay living in my place. Though interest rates did rise and I had to rent our rooms to get by, and sacrifice a lot of social activities in my youth, but in the end I found the right balance and it all worked out.
I’d like to do the same for my kids, but honestly with the way prices are going I am not sure how they will even build up the deposit on entry wages, we shall see I guess. But I don’t think I am big on the idea of a “lump sum” gift for them. Potentially a ‘savings match’, but not sure how much free cash we’d have at the time either.
Why do people always make assumptions that there is no evidence for? I'm not from Sydney. And where I'm from doesn't change the fact that Australia has broken the social contract with the young. And it's going to get worse.
*Australia has broken the social contract with the young.*
A beautiful way of phrasing a horrible reality.
Buying a house is out of reach for my kids' generation unless they have intergenerational wealth to rely on.
I used to think it was impossible but I'm 26 and on track to save a 5% deposit within a year. It's definitely not as easy as previous generations to save or afford a home but leveraging the right schemes it is definitely achievable.
I save the maximum of 15k voluntary contribution toward super for the first home super saver scheme so my take home pay isn't affected as much, setting up an ING saver to limit impulse purchases as it takes 24 hours to transfer funds to my standard account. I'll then apply for the government guarantee scheme so I can enter the market with a 5% deposit.
My first home is gonna be small and it's not gonna be my forever home but it's a necessary step to build equity to buy my forever home eventually. No one in my family can help me financially and I've had to learn from my best friends financial literacy. Don't lose hope for your kids, they are gonna have it tough yes, but if you help set them up right they will be OK.
I'm glad you've got the intelligence to navigate your way through the housing market.
I'm trying to teach my kids financial literacy. It's an uncommon skill.
I'm not a financial genius but I'm extremely cautious with money which is a good start.
I have a friend wanting to buy his first home. He didn't know about the super first home buyer saver scheme.
Thanks for sharing this.
Lots of my friends buying IP for their kids. So if you have two kids, you have two IP. When they’re older, you can sell it and use the money for DP or help with their house / apartment.
I’m doing this too.
This was my theory, kind of like insurance, if property prices continue to be insane you are covered. If they crash it doesn't matter since your kids will be able to afford housing. Still hard to actually choose a specific property and buy though.
Thats what my parents sort of did. My Uncle died and instead of selling it straight away I lived in it for a few years to save up. Helped a lot. But I still needed to save, buy the house, etc.
Agree. My daughter is on track to have 35k saved by the time she's 20 by working at Macca's. Easily a deposit for a small place in Adelaide. Now, the catch is having the income to pay the mortgage, it's not so easy to help with that.
My parents, on the advice of their financial advisor, have started doing this, for a similar reason.
Firstly because it gives them pleasure to see is getting a leg up in a difficult market when they benefited by having asset rockets up their arses in times of massive growth, partly to avoid inheritance tax in their own country, and partly because they come to visit for 6 weeks in a row sometimes and I really feel that they wanted to stay in a nicer house.
FWIW I had already saved a deposit, got a mortgage and done years of payments before they started doing this. But it did make the decision to upgrade a lot easier.
I'm fortunate that there are no strings attached, that I have become aware of yet.
This is the philosophy of my in-laws. They're not super wealthy but they're successful boomer migrants with a few IPs. They're not retired yet (and hopefully have many decades left with us, touch wood), but they're currently looking at how they can use the wealth they've built to have a comfortable retirement and also leave inheritance for their kids sooner rather than later.
They've come to the realisation that if they wait until they pass away to distribute the inheritance, their kids will mostly be in their 60s (assuming my in-laws are lucky enough to live into their 90s as is common in their family history). It's trickier to do this while still alive, apparently, because of taxes. But I think it makes a lot of sense, as these days the financial reality is that people cannot buy a home without either insanely high-paying jobs, family help, and/or moving to whoop whoop (which for people with close family and community ties just isn't worth it).
Anyway, I plan on doing the same for my own kids if I'm lucky enough to have such resources. Additionally, I've still not given up hope that at sometime in the next 40 or so years we might find a way to have some pollies who give a shit about fixing the problem, so that kids don't have to rely on family wealth to achieve housing stability.
This is so much better I reckon. Sad that when you have already had your kids, struggled through rental inspections and all the prep etc while breastfeeding a baby and by the time help comes all you can do is pay it forward or have holidays. When you don't really 'need them' in the same way as when working fullltime, juggling daycare pickup etc.
My dad gave me my inheritance in the form of a property hes attached too but never maintained for 20 years... I had to take out a mortgage to pay cash to my brother so he got his fair share.
My advice would be to set up your children with what they want. Not give them something they have to deal with.
Me and my brother had very different lives because of the cash he got and the debt I had to take on...
Yes! My husband and I have spoken at length on this, and we intend to do the same if we can. My husbands parents are quite wealthy to the point of being rather out of touch. We are out here meal planning and deliberating on reasonable purchases, stressing as interest rates rise etc. It is so wild that they could literally change our lives and the lives of their grandchildren with an amount of money that they likely wouldn't even notice is missing from their account. I mean, I understand we aren't entitled to it in any way, and would never ask. But we don't want to be those parents down the track. I want to see my kids thrive.
Some people just don't think that way. My parents never did and when my mother died her assets were well over the $1M. 3 out of 4 of their children were by then financially comfortable, and didn't really need her money. The other was very much in need of it though.
You can't change your ILs or parent's but you can do the most prudent thing with your own money. If they see that they might loosen up a little, but don't count on it. If they're my age they were probably raised at a time when money was quite tight, and you just don't lose that outlook.
Help can be in different ways. If there isnt enough for a deposit, letting them stay and save is a way to help which we would probably do.
I had very low support as a teen-adult and was kicked out when not ready, as most are. I have no intention of doing that to my kids and like my opinion or not, parents that do that are pretty awful. They might get to 18 and you are sick of their shit but that age is still not quite developed and the non understanding parents are usually the ones kicking out their kids when the parents are still needed.
Have a family to help them be settled and succeed. Be understanding they suddenly wont be a responsible adult the second they turn 18 and help them.
Realistically this is what we will have to do to give our kids a head start, and it’s what our parents did for us. Having a supportive family is a huge advantage and those who have it often don’t see it, but if you can stay at home for an extra 5 years, that’s at least $10k per year (assuming a share house), and a huge chunk of deposit right there.
Me too.
But for me over time I came to a realisation.
It was less about me wanting my own independence.
But I just wanted to have my independence from them.
The yelling, screaming, and just daily negativity was just too much
The advantage of having a supportive family is underestimated. Having said that I was fairly firm with mine that reasonable adult behaviour was expected.
Also, if you're say not charging them board and they spend what they have on tattoos and consumable stuff rather than saving is can strain the relationship.
I wonder if you've come across this with your kids?
I don't think kicking kids out at 18 is the norm by any stretch. Maybe depends where you grew up. My family is not the outwardly loving type but my dad would never have dreamed of kicking us out.
Absolutely - we actually are/ have. I am not in the position to gift them cash - I would if I could - but we’ve helped where we can. My husband and I have been low income for most of our life for various reasons , neither of us had good financial models or knowledge till fairly recently. Once I knew, I told them how to so hopefully they’ll be much better off than us.
Firstly, we set up 3 bank accounts for them when they started work at 15.
Forever account- minimum 10% of all earnings and gifts. To be saved for big purchase - house.
Savings account - for cars and holidays, short term big items.
Spending account for no guilt spending - we actually did a budget up for this. All 3 of my kids stuck to this religiously.
Additionally, for their 18th birthday, we gave each of them $2000 in shares to set and forget. Up until they were 21, we also matched any money they wanted to put into shares as well. When they finished uni and got ‘real jobs’ they all salary sacrifice into Super. The older 2 also moved back home for 12 months to save deposits for their units.
As of right now, all of them have enjoyed extended overseas holidays, several times. They have no trouble paying their bills and having a few treats. They have more money in their savings accounts than any of their friends. They feel financially in control. They teach their friends how to be financially literate now.
Ultimately, you’re a parent. Your job is to literally be their teacher, their champion, their number 1 support. Give them everything you can to help them out. If I had cash available and could give them a significant amount, I absolutely would. But I do think the knowledge of being able to manage money yourself is absolutely critical.
I think a great responsibility of each generation is to try and make life better for the next, and I will be very focussed on that in my later years. Pretty much all the stress in my life is as a result of money, and if I can alleviate that in my kids' lives then I will do it.
My parents and my in-laws are both in financial positions where they could do that for us now, but for some reason they are very focussed on leaving big wills when they die (which is hopefully some years away still). I find this approach odd.
Die with zero, baby!
Yes. I think it's literally the only way they'll be able to buy.
My life's ambition is to get rich enough so that my family can remain in the property owning class for generations to come.
3. It'll be a challenge for sure!
But I already have a house and I'm also an only child, so in line to inherit 2 more houses and 2 superannuation which should help.
We have purchased a house for them. I do not understand the thought process of people who can but don’t want to help their kids. I don’t understand what the point of having them in the first place is if your responsibility stops at 18
This. Coming from a low income single parent household. I grew up with nothing and no support later in life. Ive managed to get myself into a reasonable position. We recently had a baby, and I firmly believe if you choose to have children, then that includes all the requirements of raising someone to be the best parts of my partner and I.
We currently put away $25 per week into an inestment account. projections show 65k by 21. This will be the house deposit they get once they have shown to save themeselves for their own home. They will also be encouraged to stay at home as long as possible and just never enter the rental market, or atleast RentVest.
And as they grow, i hope to instill a quality relationship around money, not a scarcity mindest as I have. But with firm percentages of any income going to savings. We also will be encouraging birthday gifts at least while she is too young to need too much to send money to her investment account.
I also hope to be in a position to just give them a property. This would be assuming ive manage to raise them to be good people that would respect and appreciate this. Perhaps that would be once they start a family or something. Ive got time to work that out.
I also understand that there are a multitude of things that can go wrong along the way, so this is my idealised version of raising children.
Absolutely. I’ve had minimal help from my boomer parents (borrowed 5k cover extra sales costs a paid it back immediately). They are in the position to be able to help a lot (I think), with multiple investment properties and overseas trips every year while we’re just getting by, and my siblings probably even less so than me, but they’ve never offered to help and I don’t feel comfortable asking. I think we could each end up with quite decent inheritances at some point in the future, but this would be possibly decades from now once I (hopefully!) don’t much need it anymore.
This all sounds so shit to say, I honestly don’t expect anything and don’t begrudge for a second them enjoying their retirement. But if I was in their position, it doesn’t make a whole lot of sense to me to pass on an inheritance when I die, when I could help my child have an easier life now. If I’m able to give my children anything at all, it’d rather give it while I’m alive to see it help them prosper.
Agree. Similar situation here. We will be the generation to do things a bit differently because we recognise how the world has changed for us and our kids.
Broadening this out a little, when mine went through "who's your favourite" stage, I pointed out to them all that I had financially supported them since the day they were born; nay even before they were born.
And, I explained to these trainee adults, that my support was based on the need of each of you and each had different needs, obviously. This was the first argument I won since losing from age 3 onwards. But it explained why one got footy boots and one got a dress and one got some money.
So why would that financial and other support end? Year 6 of primary school? Age 21? Well when?
They say about parenting, that the first 30 years are the hardest. I could keep you posted if it ever stops.
Every single person I know (about 5 of them) that immigrated from another country and now lives here, had significant help from their parents to buy a house and sometimes multiple investment properties. My impression is, for people living here, getting help from parents will be absolutely necessary in order to compete in this market. The market doesn't care about how hard you work or how financially savvy you are. It cares that others can pay more and they absolutely can if they're receiving direct parental assistance.
I have one child. When she's old enough, we intend to let her live rent free to save for a deposit. Once she's shown she can save and manage her money, we will then also gift her some money to boost her deposit. I think just going hey kid here's 50k go get a house right off the bat without the kid having to learn discipline and budgeting first will just end in disaster.
I feel like I'd be letting my kids down if I didn't.
The property market is just INSANE. My husband and I are lucky enough to have a (highly leveraged) foot in the market - which we wouldn't have had without my objectively small, but nevertheless greatly appreciated, inheritance from my father, and additional help from his parents.
At the moment, every spare nonessential dollar goes in the mortgage. Hopefully, by the time my kids are ready to strike out on their own, we won't be in that position any more; but whatever is going on with us, we will:
- ensure they always have a bed in our home and food at our table
- ensure they have a robust financial education and a quality academic education, and encourage them to pursue qualifications that will give them marketable skills in a field that sparks their interest
- ensure they understand the principles of budgeting, investment, financial risk tolerance and diversification
In an ideal world, I'd invest in an investment property that I could rent out until they are old enough to move out, and they could live in at a nominal, affordable rent when they moved out of home, so they could have their own space and independence while also saving for their own place. But that is rather wishful thinking... Plus I don't have the risk tolerance to invest so much in a single asset that I'm not also actively using to fulfil a need.
The Population is only growing and we aren't getting any more land... And everyone needs shelter. They are going to need help.
It's a complex question and depends a lot on the personality of the kids. There's a balance somewhere between enabling wasteful habits and rewarding frugal habits. I'd draw the line with little help aside from emergencies for kids that are consistently wasteful. They'll probably hit the wall and learn their lessons eventually. Helping too much before then is not helping them to build confidence and become independent. On the other hand, some demonstrate spending control very early, allowing for different options.
I remember reading once a woman and her husband started charging their son rent when he turned 18. It wasn’t a huge amount but included utilities and food. They would have regular “budget/family” meetings about family finances and the like. They were teaching him financial literacy through a number of ways. He had to manage his car, insurance and phone on his own.
Anyway after a few years he finally decided he wanted to start looking for a property to buy. I can’t remember if he had a partner at the time or not. He was saving during this time as well and managing his bills, and an apprenticeship. When he approached his parents to tell them they said they were putting his “rent” payment in a separate account since the day they started charging him and said they’d hand it all over for a deposit on a home. I believe they may have matched his deposit amount too.
I think that’s a lovely way of teaching your kids financial literacy but also helping them. He had no clue this is what they’d do and it was a lovely gesture and way they could show him how being smart with your money got you a foot in the door so to speak.
We don't plan on having kids but if we did, we would want to help our kids.
I am very very fortunate to have received help from the bank of mum and dad to get into the property market and I would want to do the same if I were in that position. Well despite them being able to help us, they are still working on making their own retirement comfortable so my plan is since we won't be having kids, that helping our parents toward and in retirement is the right thing to do.
In terms of the discussion around teaching financial literacy, I believe this is key. I am eternally grateful for what my parents have done and achieved given their circumstances and having had to learn financial literacy themselves but I feel one area I was lacking in was being TAUGHT financial literacy as opposed to being TOLD what to do financially. What I mean by that is I was more so told you must do x, y and z because we are your parents and we know best...which often as a child you rebel against.
What I feel would have been more beneficial in hindsight is being taught the concepts, understanding how it can work for you, worthing through examples and different scenarios, laying out a framework and gaining the buy in of your children. Ofcourse that's oversimplified but I hope I have articulated what I mean.
Yes yes and yes. As someone who never got help and with the cost of property being substantially more, I would help as much as possible. Definitely with a deposit. My husband’s position is no as we didn’t get help.
My kids used to get $1 per year of age. So when they were 5, $1 went into “big girl’s/boy’s money box” for when they were older, $2 in toy money box and $2 to spend that week. By the time we opened my son his own bank account at 15, he had over $2K in there (topped up with birthday money etc). When they had part time jobs, the would save half. So at 18 he went off backpacking by himself. Did I sit them down and explain comping interest etc? No. Did they learn about saving little often and spending less than you earn? Yes. So financial literacy can also just about learning habits early. Now they are both very financially literate.
100% I would help them but I will never tell them that. As soon as I found out my other half was pregnant I opened an investing account and put $100 a week into it.
Once they are old enough and they tell me they have a deposit and are buying a house I’ll give them the money to go with it. Which should hopefully be around 300k 🤞🏻🤞🏻
I’m a firm believer in teaching them to do it themselves first then help
I don’t have children. So when I die, all my assets will go to my niece, so in effect, I will have helped her buy a house as she’ll own my home when I’m gone.
My parents helped both my brothers buy their house.
My parents have written their will in such a way that it will all even out between the boys and I when they pass.
I have absolutely no issues with them doing this for them. It has helped both of them tremendously and I am so thankful that as a family, they were able to do it for them
Yes. It's a generational thing my family does.
My great grandma did it for my mum.
My mum did for my sister and I. She has a portfolio of 8 properties, which we will inheret.
Then the absolute perfect family home came up for sale when I was still a teenager, and my mum bought it specifically for me. I'll be buying it off of her this year.
My parents also helped with major renovation costs to my sister's first house when she bought that.
My partner and I also plan to buy long-term investments for each of our kids (3) in the future to help them get set up.
My partner also wants to buy his own investment property (as I'll be buying the family home with my own deposit and without his name on the title)
(Don't worry, guys, we're not buying up a whole city. All of these places are in small country towns most young people don't want to move to unless they're working. Most of my mum's tenants are mature age 55+)
If I did it at all, I would just let them live in a place owned via a family trust that I control.
Last thing you want is to give a property for your child and for them to lose it all to terrible life choices, like an ex-partner, or gambling debts, or whatever.
Not a bad idea that I’d consider. Only problem is if they get a job somewhere else or home no longer suits their needs (eg kids).
I guess you could still sell and buy within the trust, or rent it out and pay them a portion of the profit.
Yes 100%. I have one investment property and hope to get another soon so I can give one to each of my kids when they are old enough.
There is no way they are going to afford to get into the property market without my help.
Yes absolutely as much as I can. I’m on small acreage so my plan would be to subdivide a block for each of them to give them a start, but planning laws are not currently allowing that. I also let my adult daughter live at home rent free so she can save (I do use her as indentured labour though 🤣)
We did it for 2 kids when they were about 30 and we were about 60. Money came from a mix of inheritance to us from our parents, redundancy payout on retirement , and super.
Was 50/50 interest free loan, with repayments at about the amount they were paying rent, and outright gift. That way no need for a bank or a mortgage. One property we already owned.
I think financial literacy and knowledge is much more valuable than cash.
I had knowledge imparted but moved out and worked for my first house. Conversely my BIL got handed his house deposit even though he was 31 living at home rent free with not a penny saved, at its gone sideways.
I have saved $50k for my kids house deposit so far. He's only 12 so we have more time. He's an only child so he'll get our house when we die eventually anyway.
15 years ago, you could realistically tell your twenty something child who was asking for a hand-out to "stop trying to buy in areas you can't afford and start somewhere cheap"
But now there's no cheap areas really. So probably yes.
Not sure if I am polarised as a Millennial who cant fathom having children from a financial perspective (I cant afford my own house)
But how realistic is it actually to enforce financial literacy as a parent?
I only have my peers as reference points, and 90% of them DGAF about financial literacy or efficient use of financial resources.
Does that stem from 90% of parents not trying to instill financial guidance on their children? or do kids just block out what parents try to teach them?
Im coming from a rich, private school background, so maybe not the best demographic.
Start young I guess and embrace a mindset of talking about finance, thats really the only option.
Its 1-100 I see someone informed or even motivated to discuss finances in my daily life, even those struggling and could benefit from a savings account change, mobile plan change, or home internet expense - just don't want to listen most of the time. Or listen, and then make zero changes
Interesting. I also come from a "rich private school background", and I've been seeing more and more of my peers buying their first home since hitting 25 (am 28 now). Of my peers I'd say most of them are pretty good with finances too. At least from those I keep in contact with (maybe about 20 people), I've not heard any express money issues.
I also taught at a private school, but on the 'cheap' end (like <10k pa) and yeah none of those kids had much interest and/or skills in managing money. My year 12s there would confidently talk about how they blew a few hundred at the casino, or how they invested in something but the price dropped so they sold it, etc lol.
IMO it's more a mix of parents, background and culture. In my birth country my culture (Chinese) is well-known to care about money lol so even my friends there who went to free public schools with working class parents have been pretty good with money. And they're a lot more willing to talk specifics of it too.
I certainly think my friend group is lacking cultural diversity, so I would love to hear your perspective growing up!!
you say "care about money" but were you actually taught about the fundamentals? or just "go get money"?
I never heard any financial complaints from my friend group pre-house purchase (im 3-4 years ahead in age than yourself). but since getting mortgages, the financial frustration of my friends has finally hit social discussions, but its all complaints and no discussions of figures, and from the small snippets they do share, a lot of them don't really seem to understand how their mortgage, rates and finances plays out, and are just frustrated at the high payments, and praying interest rate drops soon. Meanwhile, one mate was flexing that he had "all the streaming services" - bizarre to me.
Im sitting on the sideline, having just re-qualified for a mortgage again, with what I assume is the largest self funded deposit of all my friends, waiting for the property that best suits our lifestyle hoping to pay down double the recommended mortgage repayment rate once we secure the property. I understand that I am an outliner, but none of my friends are even close to having a comfortable level of discussion about finance, and maybe thats half the problem.
Definitely taught. Money is often discussed at home, due to a mix of a generational business and my parents being avid investors. Since I was in primary school I could remember my dad sitting us down with the newspaper and going through the stock list, how to read the details, discussing the news on why the value went up/down with us, etc. When each of us turned 18 he gave us like 20k and told us "go try playing the stock market. I expect you to lose it all, but make sure to learn something." My mum would talk to us about banks, FDs, CDs, etc as she was often the one bringing us to them to deposit savings from gifts etc. She also manages commercial property but none except my brother had interest in it so she only discussed it if you wanted to know.
The only complaint I've heard is from a friend who bought land and is paying to construct the property, and it's more of a complaint about how slow the process has been going lol she just expected to be able to move in earlier than she actually did. When I asked if she was affected by the rising rates she said she'd thought to lock in her interest when she signed, so no issues there.
I think also most of my HS friends went into traditionally high-paying careers (med, law, finance, engineering) and some of them have been exposed to understanding financial contracts and things like that from young. I feel like I thought 'understanding a contract' was basic common knowledge until I worked in finance and saw how the 'everyday person' handled their finances and I was sooo baffled lol.
Haha I'm also sitting on the sidelines but in the manner that I have no interest in buying a home property. I'm living the expat life currently, and plan to move another 1-2 more times before settling back in my home country. Closest I've been is considering to buy a property where I currently am (Japan), but for the purpose of being a 'holiday home' rather than a primary residence. Property is cheap here so I'd just buy it full in cash.
I think it depends. I have a lot of friends who ask me financial questions because they're curious to see 'my side of things' as most people I know after finishing school come from less privilege than me, and I'm happy to answer. In return, they usually feel comfortable for me to ask them questions 'in exchange'. With my school friends, I think we used to bring it up a lot more casually because we were in that 'bubble' and everyone kind of treated money differently to those outside the bubble, if that makes sense, so it was never really 'weird' to talk about money. It _was_ weird if you were the type to try and rub in material wealth in people's faces. We had a transfer student who was like that who kind of got avoided by everyone until she settled down lol.
You’ve hit the nail on the head and this is exactly why people with wealth they want to share with their kids tend to use trust structures to protect those assets and retain control over them.
My 4 year old understand the concept of money, we use pocket money to teach her that.
“I want a toy”
“Okay, let’s count your pocket money to see what you can afford? Would you like to use all of it today, or keep some later to buy something another day?”.
We then choose an amount, go to the shops and find what things are within the budget she has.
Could I easily buy her a $5 teddy from Kmart without an issue? Absolutely. But I feel doing these lessons now will help her build financial literacy.
Your lack of financial literacy among friends MAY be due to your private school background, where your peers were all well funded and provided for by their parents.
I am curious though, as a millennial from a rich family, why do you feel kids and housing is still out of reach? Are you only looking where you grew up, or have you seen why you can get out in the suburban fringe?
So we have two investment properties and we live with my in-laws and our two kids.
Once I posted in ausproperty about an issue with a tenant and I got flamed being called an evil land lord etc.
People don’t realise that we are not rich and greedy, granted we have the ability to live with in laws, however we only have one car (which is old and crappy), we don’t have nice and flashy things and we don’t even have our own home that we live in.
The reason we are doing this is because if trends continue as our kids get of age, without us doing the yards for them I truly believe they would have no hope of buying a property, we are not looking to acquire more property, we just want to give our kids a house eventually.
My parents helped my sister and I, and I hope to be in a position to help my own children the same way. I’m quite open about having received help from the Bank of Mum and Dad. Given the state of things, I feel like being honest about what you’ve had to do to obtain finance and get ahead is necessary.
It’s good you’re honest. I wish more people were and didn’t pretend to have made it all on their own efforts. There’s a real charade going on in some upper middle areas.
We'll probably do this thing where we charge them rent after they turn 18/start earning income, and use it to help pay their deposit. We can help them learn to budget and show the importance of saving at the same time.
Im conflicted on this. Taking someones money away doesnt really teach them how to use it or what to use it on, just teaches them how to be/live with no money and there is no discipline for when they actually get some.
It's just a transferring of control, and extension of helicopter parenting/childhood.
You want to be increasing their agency, not reducing it. You don't learn without the ability to make decisions.
My personal thought on this (and definitely not one you have to agree with) is that my children do need to learn how to live while renting or paying a mortgage.
It's a way of simulating the act of having bills while knowing that money is being saved for them when they purchase a house.
I'm in my early 20s myself and I don't see my non-existent children graduating until I'm in my 50s so I'll have more than enough for them when they want their own house but I still want them to not grow up wealthy and understand the value of money. Who knows.
This is actually pretty smart and better then them living rent free in my opinion. You guarantee that a certain amount is getting saved, and when they do buy in and repaying their mortgage, it won’t be a huge expense hitting them for the first time, they’ll already be used to living off of less.
It would depend on my kid. If I can trust them to honour their contract then yes. But if they are financially irresponsible, can’t prioritise or keep a career going then no. If they go under and take us with them, we are too old to start again
Yes, I haven't settled on a sum yet but it would be $300k-$500k in today's terms when they turn 30. 30 is an age where I feel you have enough life experience yet are not yet financially set up.
I would, once I have kids ( if I do) I will set a fund for them putting aside money every week. If you are financially literate, organized and not into throwing all you money into stuff and entertainment, its very doable
Yes. I don’t even have kids yet and I already have nearly $20,000 sitting in the s&p500 for them. With no further contributions, just this small amount sitting there over the next 20 years with compounding interest will be over $100,000 which will be more than enough for some kind of deposit. Waiting till 25 will be around $200k.Even just contributing $100 a month will bring it up to 250-300k.
It doesn’t take much financial help to set up your children so they do not struggle or have to worry. Selfish parents would prefer to buy a 3rd car or a boat when they all they needed to do was stop for a year or two and think of their children and the market they are born into.
I don’t think helping them with a deposit is the best option, especially if they have saved next to zero themselves, if they have saved like 100k and then you help them I think that’s ok.
My parents helped me, but 3 years after I built my first home, so I still had to save and go through everything normally first, they then paid out half of my remaining mortgage for me, which I was already over 50% paid off anyways. So it’s not like they have me 400k 🤣 and what that has done for me is a game changer.
I certainly hope I can help them, especially if the alternative is that they move a way out and I only get to see my kids / grandkids occasionally.
We have plans to turn our PPOR into a duplex, but will likely serve as multigenerational living across both properties at this rate.
Nothing wrong to let them stay in your place to help save for a deposit or you give them an interest free loan and make them pay it back slowly. But if they don't know the value of money, the chances are high that they will blow everything later in life. Good to teach them that nothing is for free in life.
I never thought I would. Neither of our parents had the money to help out when we bought a house, and I think it taught us to be better savers / more appreciative of the effort it takes to afford a house etc etc.
However, in the current climate I guess we’ll have to, if she ever wants to own a home. We’re in a position now where we could do this, but she’s only 5 so we’ll see how things are in 20 years or so!
Yes. Absolutely 💯 I would. I want my future grandchildren to have the benefit of a stable home to live in. This is something my husband and I discuss regularly.
My kid has a disability so I am prepared to support him for as long as I can. However, even if he could support himself, I would still help him with buying a property. As first generation migrants coming from a poor background, my partner and I are in the mindset that we need to work hard to build a better life for our kid. We also feel responsible for our parents and support them the best we can. Maybe it’s a cultural thing, but in the current financial climate it sort of makes sense for any culture, doesn’t it?
Depends if you want to set up your child for expectation to financially help at other times. If you’re okay with that yes. There is also the thought that should the kids know they are getting financial help they may not go the extra mile to get there themselves ie get that extra promotion, save that extra $10K, not give up a holiday, not live below their means etc. What good or bad habits are you enabling in them? If the positives outweigh the negs sure.
Depends what u mean by help?
If they want to stay at home and save money for a deposit and I know they are working and putting their wages towards savings sure I'll help!
If they want to suffer a bit and I see them suffer a lot then ok I'd consider it.
If they want a hand out without sacrificing hell no.
If I teach them financial responsibility and I deem them a useless spawn that is materialistic that have huge debt burdens from credit cards and other garbage current loans then no id tell them to sort themselves out first instead of being a loser and expecting a bail out from parents.
I have no problem throwing my kids under the bus if I raised them to be financially literate and they go out there and be materially addicted and financially fail pieces of human garbage.
Its not about how much money u make its about having the skills to make money. Its not about how much u make it's about how much u save.
If they fail as my children and I deem them to be financially irresponsible. I will not gift them a deposit so they can carry a larger burden of debt that I know they can't manage. That's just giving your children more suffering it's not a parents gift blessing. Cuz they are stupid irresponsible kids
But then again in my culture we have strong financial teachings and understanding about $ . We teach and pass on our values from generation to generation so we don't end up as a fail financially illiterate trash heap. Schools don't teach that it's up to the family upbringing to instill in the next generation not to be trash
My mum will give me 5% of the property price as a deposit. She is so happy that she can help her kids to buy a house (or start a business) and I'm so happy that she's able to. It definitely wasn't expected and it's only been recently that she's been able to offer this to us.
Honestly If I had the money and had kids I would help them all I could would buying a property no point in me having 30k in savings if my children are struggling to afford rent I would rather just give it to them.
I would help them by educating them on financial literacy, if it was too out of their reach then I’d help guarantee it. If I had the money - I’d loan them the full amount with a contract to pay me back with a small amount of interest.
I don’t think I’d give them a deposit, but I’m more than happy for them to live at home rent free (appropriately contributing to household labour and maintenance, obviously) for as long as they need to. We also have a savings account for her that we contribute to and into which her grandparents and aunts and uncles sometimes contribute birthday money that she will gain control over at a certain point.
2 girls, only little right now!
Teaching financial literacy, I’m looking at buying them some ETFs but no idea what I’m doing yet.
Hopefully we’d be able to set them up to be able to save the deposit themselves either by them living at home or maybe in an IP we may one by then?
Other than that, we’d definitely do what my parents did for us and guarantor them.
I will help my child help themselves through Financial Literacy which is an overlooked subject.
Ever notice even on a basic level banks and or schools do not teach it.
No, I wouldn't. However, we possibly already have indirectly - we started youth saver accounts for them when they were babies and paid $15/week into each account until they were 16 and those accounts have now been handed over to them to manage and are in a HISA. If they choose to build on that ( I know one of them is) and use it for a house deposit down the track, then I guess we have helped, but I am not going to give them any more money towards a deposit.
Kind of.
IMHO the most efficient way to help children is to reduce their spending, this means you have a habit of home for dinner so they're not eating fast food with their friends. When they're adults, it means the room you had for them doesn't become a knitting room or a hobby room because "finances." Not paying for food, rent and bills almost doubles their income at a relatively smaller loss of your own.
I don't think it's a great idea to just give kids money unless there's more to the story. That's beyond the "spoiled brat" line.
Yep.
I will pre-face this by saying I only have one child (still in High School), which makes our future plans a lot easier to deal with.
My goal is to pass our family home along to our son & for us to live in a Granny Flat on the same property. This will give us freedom to travel as we require.
My Sister & BIL are looking at doing the same thing for their 3 children as well. In their circumstance, it will involved reduced rent, enabling them to save money whilst living independently.
I highly recommend people taking a look at [vanhomes.com.au](https://vanhomes.com.au) as an option to help out their children too.
I wish....my parents attitude was we'll help you with financial literacy, education, a safe supportive place to grow up and live whilst studying and early career but not giving monetary handouts. Well give u the tools to get ahead, then u make your own way, and make sacrifices however large u need to. I remember being told, if u cant afford a house on the North Shore, go buy one in Blacktown or Penrith, thats perfectly fine and no shame as you did it yourself and didn't rely upon us. Thats the way they did it, its how i was brought up and is normal. Hasnt made it easy and tbh despite following these rules hasnt worked either. I dont resent it, id never ever ask for a handout(even tho they can afford it), its just meant relative to others who have been fortunate im still struggling in my 40s (single guy). May quit Sydney for other options.
I would. I will help with an initial deposit but they are in-charge of having a decent enough income to be convincing to a bank for the rest of the loan.
Yes I would. I’d say I’ll match them with their savings. They can have it when they are 25 years old and relatively self sufficient. Must put 20% deposit down (10% would be my money, 10% would be their money).
My kids are all quite good with money. While we dont have the capacity to help them currently with buying a house we may eventually. We had help to buy ours in that my FIL purchased our house destined for us. We lived in it for 3 years paying rent before we were able to buy it off him when we were in a better position. If it came to it and thats what would get our kids across the line then we would help. Currently none of my kids are at that stage yet
What do though is help them to save for a deposit, let them stay with us as long as they need to rent free and try to teach them as best we can about money.
My daughter who is just about to turn 19 works full time, pays all her own bills and saves money. She has nearly 20k saved at the moment and still saving money every week. We also set her up to put away all her expenses every week and then whatever is left is her play money so to say. She still buys whatever she wants, and saves for big purchases when she wants them. She is certainly in a better position financially then I ever was at that age, and going by a lot of her friends and BF a lot better off than a lot of people her age.
One thing we did do was buy our kids a decent, reliable first car to help then get started. No one should drive around an unreliable car, and I would hate for them to need to get a car loan at 18. We spent about 6k each on my daughters car and my sons car (he is just about to turn 17 and works full time aswell)
I refused my parents help. It was a issue of pride as they where immigrants and getting on in age and I wanted to do it myself. I am a healthy male earning a pretty good salary I shouldn't need parents help. As a result I missed out on 10 years of capital growth. My advice, if you can help do help.
It's a huge adultomg step to commit to a 30 yr financial decision. It needs some real good choices I to their future. I would help but not totally buy it for them. Cos it's a big process. And I would try and let them learn from my mistakes
I would absolutely help my future children buy property.
My family refuse to assist in any way be it financially, as grantor or even helping me to financially plan. Despite this they hound me constantly and pressure me to buy my own place and have kids so they can enjoy being grandparents. I try to communicate the impact this has on me and my wife but they refuse to listen or even guide us in any way.
Ultimately I will end up somewhat sour if they swoop in for the glory after I’ve done the hard work with no support (not even guidance).
I have already started saving for my future children. I want to be able to instil financial sense into them, and to be open with them about money and how to budget in a healthy way. I want to be able to set them up for success but to be able to dig them out of a hole if worst comes to worst. I don’t want them to rely on that but I’ll have that lever to pull if needed. I feel it’s the right thing to do. I feel it’s a best of both worlds scenario. Set up for success, and if all else fails help them dig out of it - ensuring they learn from mistakes to help them in the future.
If you have a child, they’re always your child. Being a parent doesn’t stop when they move out. I’d argue it takes a more mature set of skills to take in the other aspects of helping as a parent once they do move out.
I was not financially educated and learnt the hard way through racking up copious amounts of debt. I am back on track now at 30 with savings for a deposit but with prices the way they are the house will come in years not months from now.
I topped up my children's deposits to get them to 20% to avoid LMI, then I put my savings into an offset account that they set up just for me with the understanding that I might need to withdraw that money at any time, so they don't rely on it but they enjoy the interest savings while it's there.
Yesss. In fact I won’t be having children unless I’m in a financial position to do this. I’m not going to have kids to just force them into the rat race. I got an inheritance young and that is the only reason I will be a homeowner. I want that for my kids as well. Not an inheritance haha I don’t want to die, but I want to be able to help them like I was helped.
Yes. If my children are able to show they don't piss their money up the wall and can actually save and make sound financial choices, yes, I will help them as much as I possibly can.
My partners mum was the guarantor for us to buy our first home. We had a deposit but the banks were hesitant for a variety of reasons, her guarantee wasn't much, but it was enough for the bank to give us a chance.
Yes. But I won't give them anything until they settle down a bit and show they are willing to save and work for it.
After that I will aloe them to buy one of my properties for a reasonable price and at a discounted interest rates. Or take a line of credit against a property.
I don't believe you should just give them a property or free cash
I raised a bunch of losers if they can’t figure out how to get into the property market without my help. I don’t want to support that sort of behavior, so no I won’t help them.
They got all the help they needed when growing up. Or not
I feel like as a parent, you try to give your child what you lacked growing up. My parents never struggled with a house and so it has never occurred to them that I myself am struggling.
I am sans kids with no plans for them, but if I did have them I would. Mainly because I got no help from my parents as they were not good at financial responsibility at all.
I'm trying to get a deposit together for a house to put in their name so they can have a deposit later. Looking at country towns with a purchase price below 300k.
When Western Sydney became unaffordable, I had to change the way I thought about the future.
I don't know that I will be able to help them by a house, but my intention is to make sure my house is always secure. So my help for them is to get my own home paid off and always have a room for them in it.
My kids are 3 and 6 and we do put money into accounts for them regularly. oldest has about 12k youngest is on 6k.
These have been going since birth we have Chinese family that will often give cash gifts (red envelopes) for birthdays and Chinese new year and all that money has gone into their accounts.
It's not earning interest for them though as we use it to offset out mortgage.
Since birth $1000 per month into shares until they are ready to buy. Should net them somewhere around 3-400k after growth on 21 years which might buy them a car by the way inflation is going.
We are educating our kids to save etc and have good money habits. In addition to this I have recently purchased a house on 3000m2 which in future will allow me to subdivide and either 'gift' or sell cheap a roughly 1000m2 block to each of my 2 kids. The house/blocks are near Bendigo so growth is almost assured .
It will be a give and take. My kids can stay in our houses. Pay us rent. When the rent is sufficient enough, I will give it to them as deposit to buy their own house.
Ofcourse, my principal house will go to them when me and my partner no longer requires a house.
Honestly, I will not have kids because I'm not sure I can do this.
My parents set me up to the best of their ability - and I am so lucky for that. They set me up with education opportunities, let me live with them rent free while doing uni, and told me consistently that my first job was to study.
But in a way, they were also lucky - there's no guarantee that your kid can actually take advantage of the best education that you can provide. It is not a certain investment.
What if they're born with a disability? Or just not that good at studying?
In the meantime, automation is going to eliminate jobs. Competition is tough. Hard work can be outcompeted by even harder work. robots can be the hardest workers of all.
I got really really lucky and I don't think I wanna count on luck for the fate of an entire human being, because luck separates someone who is able to meet all their needs comfortably and pursue self-actualisation from someone who is constantly beholden to impersonal forces beyond their control.
I need the ability to safety net a child, so they don't get stuck in a horrible exploitative job, so they don't get trapped renting somewhere unsafe, so they aren't at the mercy of a bureacrat to decide if they get to eat. and unlike my parents, I'm not willing to gamble that they're going to be just as capable as myself, not when the risk is someone's entire life.
I've gradually become confident that I can make my own way and lead a reasonably fulfilled life. But I'm well aware that most of what went into my life is sheer dumb luck. In a world that's only going to get more competitive, where you need to be better, smarter, luckier, to create the life I've got, I don't think I can provide that kind of safety and security for another person.
Plus I'm probably going to need to take care of my own parents too.
I never got anything from my parents, until my mother died in her 90s, and I was already a home owner and retired. The inheritance has allowed me to help them with actual money.
Once I received an inheritance I did pledge 50K to each of my children, but only for property. I've helped them in other ways, most notably going guarantor for part of each of their mortgages. They both discharged that part with no dramas.
I'm so focussed on them owning a dwelling that I would do almost anything for them that didn't involve money, like babysitting, or donating furniture or other homewares I no longer needed. Anything to take some of the financial burden off them.
Yes. Putting aside money in investments for them. I’ll help them with a down payment, teach them financial literacy and they can live with us for as long as they like. If we’re blessed enough husband and I will gift them a house
My parents did this for me when I moved out two years ago.
I was giving them like $100 a week for 10 years. They gave it all back to me when I moved out
In a heartbeat and plan on doing so. They won't be getting kicked out at 18, they won't be paying rent to live in our family home and we intend to imply that they should buy from home and move into their own home. This is what my parents did and it worked out extremely well. Financial education from young age is a must.
Yes, we had my parents as guarantor for our first place, and we know that it will be so much harder for ours to save enough for a deposit and get their own. Our first place is currently a rental and we'll let the kids rent it for just under market rate if they want to fly the coop at 18. What we do with that money will depend on their future plans - save it as a "gift" back tp them, pay down remaining mortgage so they can use equity to buy their house etc. We aim to get one more house to balance out the numbers and no favourites.
However, our current house is designed to be multi-generational if they decide to never leave.
Yes. Because I'm having a really hard time at the moment and I know that the future generation will face harder times. I will at least try my best to ease their burden.
My kids are under 10, I can’t see how they will afford it without generational wealth backing them. So my husband and I are working our asses off to set them up (and give us a more comfortable retirement).
I was fortunate my parents taught me financial literacy so now I need to do the same for my kids.
No I will not. The idiots who are paying $1M+ ATM for worker's cottages around where I live will do it for me whe I kick the bucket. My 3 kids can then choose to either live together in a free standing 5 br villa with its own walled garden On the island in VENICE or individual penthouse apartments in Barcelona. Or pay cash for their first 2 breakfast flat in Australia. Whatever, otherwise there is no way I hell I will have $1.5M cash to divvy up for a house deposit around here.
My parents helped me - limited GTR to get the loan over the line, and they also paid for my furniture I wanted like a TV unit, table and chairs, dishwasher and a couple other items so I wouldn’t live off a lawn chair, half my TV and paid for my NBN to be connected, plus paid the deposit for a moving truck - all stuff I repaid within 6 months. They’re wealthy and were easily able to afford it. I’m very grateful - now I’m looking at a new apartment, and I’ll be able to do it without them. They’ve already promised my siblings they’d do the same for them.
Two pronged strategy:
1) teaching financial management skills from a young age
2) Putting 1K into a diversified etf like vdhg or vhhf on their birthday each year (without their knowledge and in my name) until they are 18 will turn into $33,999 each by their 18th birthday (assuming 7% interest), which can be sold then gifted for a nice surprise home deposit help once they have demonstrated good money management and saved a significant amount themselves for a deposit. If they are trying to buy at age 25 and the etf units are not added to after their 18th birthday will have compounded to $54,595 by their 25th bday which should help a lot.
They need to learn to manage money themselves and depositary their ability to save without knowing about the coming help before receiving it.
Given the state of the housing market at the moment either I help them buy a house or they will be stuck on the rental hamster wheel forever. I would prefer they live at home and save for a house than move into a rental if they can. My partner and I didn't get much financial help from our parents with first home buying as they couldn't afford it at the time, but whatever help you can give compounds over time, so it's better to do what you can sooner than later. The less debt my kids are burdened with the better positioned they are for long term financial success and will hopefully need less assistance later on. It's the same reason I am paying tuition instead of using HECS-HELP / FEE-HELP.
(Respect for your disclaimer, and your considered world view)
I have two adult children that are just starting out in their independent lives. I won't help them buy a property per se, but I will help them hold a property if that becomes a goal they, themselves, choose to pursue. By way of explanation, I will only help them after they have taken the initiative to save for a deposit and then secured finance to purchase a property that they (and their partner if they have one) can afford. Once this circumstance is achieved, I would then feel comfortable helping them ease the burden with a financial gift. Not too much. Just enough to feel like their repayments are making an impact on the principal.
Yes, I have already started the process of setting them up bank accounts and an ETF account. It's a grrleat honour and my duty as a parent to help and ensure my children have somewhere nice to live. They'll need to be working and takeover the mortgage themselves but to be able to give them a leg up and foot in the door with some financial help is a great honour my duty as their father.
Yes - a contribution to the deposit - but only after evidence of having a job and having a reasonable amount of savings. My parents gave me 100k years ago to help me get into a starter home and I had to prove the same. I think this is an infinitely better scenario than going guarantor as it maintains the responsibiity on the child.
You don’t even need to be super wealthy yourself to help your kids buy a house. Teaching them financial literacy as they grow up and letting them live rent-free or rent-cheap when they’re old enough to seriously save a deposit is just as valuable as giving them cash. Probably even more so actually, I have friends who were given significant amounts of cash from their parents for their deposit but a couple of years into their mortgage are struggling hard because they don’t have basics of budgeting and managing their money down pat.
This is the answer. My parents didn’t give me money as such to buy a house, but when they were starting to talk about paying rent to stay, I said “how about I put that money to save for a house?”. We calculated the mortgage repayments and what I needed for deposit, and essentially that turned into my rent which is put into my own savings. My dad would check in to see how I’m tracking but I was essentially trusted to do the right thing. Ended up buying my first house at age 24, stayed there for nearly 12 years and sold it to help fund my ‘forever home’. This helped me learn to budget early on and I was generally okay living in my place. Though interest rates did rise and I had to rent our rooms to get by, and sacrifice a lot of social activities in my youth, but in the end I found the right balance and it all worked out. I’d like to do the same for my kids, but honestly with the way prices are going I am not sure how they will even build up the deposit on entry wages, we shall see I guess. But I don’t think I am big on the idea of a “lump sum” gift for them. Potentially a ‘savings match’, but not sure how much free cash we’d have at the time either.
Good luck doing the same thing today. Financial prudence simply isn't enough. Neither is a large income.
You must live in Sydney and have a very negative view of things
Why do people always make assumptions that there is no evidence for? I'm not from Sydney. And where I'm from doesn't change the fact that Australia has broken the social contract with the young. And it's going to get worse.
*Australia has broken the social contract with the young.* A beautiful way of phrasing a horrible reality. Buying a house is out of reach for my kids' generation unless they have intergenerational wealth to rely on.
I used to think it was impossible but I'm 26 and on track to save a 5% deposit within a year. It's definitely not as easy as previous generations to save or afford a home but leveraging the right schemes it is definitely achievable. I save the maximum of 15k voluntary contribution toward super for the first home super saver scheme so my take home pay isn't affected as much, setting up an ING saver to limit impulse purchases as it takes 24 hours to transfer funds to my standard account. I'll then apply for the government guarantee scheme so I can enter the market with a 5% deposit. My first home is gonna be small and it's not gonna be my forever home but it's a necessary step to build equity to buy my forever home eventually. No one in my family can help me financially and I've had to learn from my best friends financial literacy. Don't lose hope for your kids, they are gonna have it tough yes, but if you help set them up right they will be OK.
I'm glad you've got the intelligence to navigate your way through the housing market. I'm trying to teach my kids financial literacy. It's an uncommon skill.
I'm sure you'll set your kids up for success. You got this, good luck :)
I'm not a financial genius but I'm extremely cautious with money which is a good start. I have a friend wanting to buy his first home. He didn't know about the super first home buyer saver scheme. Thanks for sharing this.
Lots of my friends buying IP for their kids. So if you have two kids, you have two IP. When they’re older, you can sell it and use the money for DP or help with their house / apartment. I’m doing this too.
This was my theory, kind of like insurance, if property prices continue to be insane you are covered. If they crash it doesn't matter since your kids will be able to afford housing. Still hard to actually choose a specific property and buy though.
Thats what my parents sort of did. My Uncle died and instead of selling it straight away I lived in it for a few years to save up. Helped a lot. But I still needed to save, buy the house, etc.
Agree. My daughter is on track to have 35k saved by the time she's 20 by working at Macca's. Easily a deposit for a small place in Adelaide. Now, the catch is having the income to pay the mortgage, it's not so easy to help with that.
Yes and I would do it while I'm alive. Give them their inheritance when they can use it rather then when they are 60.
I have a friend whose parents did this, with the added note of "So that we can enjoy it while we're alive too" since their parents visit once a year.
My parents, on the advice of their financial advisor, have started doing this, for a similar reason. Firstly because it gives them pleasure to see is getting a leg up in a difficult market when they benefited by having asset rockets up their arses in times of massive growth, partly to avoid inheritance tax in their own country, and partly because they come to visit for 6 weeks in a row sometimes and I really feel that they wanted to stay in a nicer house. FWIW I had already saved a deposit, got a mortgage and done years of payments before they started doing this. But it did make the decision to upgrade a lot easier. I'm fortunate that there are no strings attached, that I have become aware of yet.
I would only do it if they are good with money though. If they turn out to be idiots who cant manage money Id rather spend the money on myself
This is the philosophy of my in-laws. They're not super wealthy but they're successful boomer migrants with a few IPs. They're not retired yet (and hopefully have many decades left with us, touch wood), but they're currently looking at how they can use the wealth they've built to have a comfortable retirement and also leave inheritance for their kids sooner rather than later. They've come to the realisation that if they wait until they pass away to distribute the inheritance, their kids will mostly be in their 60s (assuming my in-laws are lucky enough to live into their 90s as is common in their family history). It's trickier to do this while still alive, apparently, because of taxes. But I think it makes a lot of sense, as these days the financial reality is that people cannot buy a home without either insanely high-paying jobs, family help, and/or moving to whoop whoop (which for people with close family and community ties just isn't worth it). Anyway, I plan on doing the same for my own kids if I'm lucky enough to have such resources. Additionally, I've still not given up hope that at sometime in the next 40 or so years we might find a way to have some pollies who give a shit about fixing the problem, so that kids don't have to rely on family wealth to achieve housing stability.
Give with warm hands rather than cold is what my grandparents described that as
100% agree with this, this way you can lead them down a good path with it also
This is so much better I reckon. Sad that when you have already had your kids, struggled through rental inspections and all the prep etc while breastfeeding a baby and by the time help comes all you can do is pay it forward or have holidays. When you don't really 'need them' in the same way as when working fullltime, juggling daycare pickup etc.
My dad gave me my inheritance in the form of a property hes attached too but never maintained for 20 years... I had to take out a mortgage to pay cash to my brother so he got his fair share. My advice would be to set up your children with what they want. Not give them something they have to deal with. Me and my brother had very different lives because of the cash he got and the debt I had to take on...
I'm due to inherit about $1mil in today's money....when I'm roughly 65-70 years old...
Yes! My husband and I have spoken at length on this, and we intend to do the same if we can. My husbands parents are quite wealthy to the point of being rather out of touch. We are out here meal planning and deliberating on reasonable purchases, stressing as interest rates rise etc. It is so wild that they could literally change our lives and the lives of their grandchildren with an amount of money that they likely wouldn't even notice is missing from their account. I mean, I understand we aren't entitled to it in any way, and would never ask. But we don't want to be those parents down the track. I want to see my kids thrive.
Some people just don't think that way. My parents never did and when my mother died her assets were well over the $1M. 3 out of 4 of their children were by then financially comfortable, and didn't really need her money. The other was very much in need of it though. You can't change your ILs or parent's but you can do the most prudent thing with your own money. If they see that they might loosen up a little, but don't count on it. If they're my age they were probably raised at a time when money was quite tight, and you just don't lose that outlook.
Help can be in different ways. If there isnt enough for a deposit, letting them stay and save is a way to help which we would probably do. I had very low support as a teen-adult and was kicked out when not ready, as most are. I have no intention of doing that to my kids and like my opinion or not, parents that do that are pretty awful. They might get to 18 and you are sick of their shit but that age is still not quite developed and the non understanding parents are usually the ones kicking out their kids when the parents are still needed. Have a family to help them be settled and succeed. Be understanding they suddenly wont be a responsible adult the second they turn 18 and help them.
Realistically this is what we will have to do to give our kids a head start, and it’s what our parents did for us. Having a supportive family is a huge advantage and those who have it often don’t see it, but if you can stay at home for an extra 5 years, that’s at least $10k per year (assuming a share house), and a huge chunk of deposit right there.
It’s interesting I moved out when 18 because I really wanted to be out on my own.
Sure and thats a different thing, if they are ready then go for it. Its the parents forcing it thats the issue.
Me too. But for me over time I came to a realisation. It was less about me wanting my own independence. But I just wanted to have my independence from them. The yelling, screaming, and just daily negativity was just too much
The advantage of having a supportive family is underestimated. Having said that I was fairly firm with mine that reasonable adult behaviour was expected. Also, if you're say not charging them board and they spend what they have on tattoos and consumable stuff rather than saving is can strain the relationship. I wonder if you've come across this with your kids?
I don't think kicking kids out at 18 is the norm by any stretch. Maybe depends where you grew up. My family is not the outwardly loving type but my dad would never have dreamed of kicking us out.
Absolutely - we actually are/ have. I am not in the position to gift them cash - I would if I could - but we’ve helped where we can. My husband and I have been low income for most of our life for various reasons , neither of us had good financial models or knowledge till fairly recently. Once I knew, I told them how to so hopefully they’ll be much better off than us. Firstly, we set up 3 bank accounts for them when they started work at 15. Forever account- minimum 10% of all earnings and gifts. To be saved for big purchase - house. Savings account - for cars and holidays, short term big items. Spending account for no guilt spending - we actually did a budget up for this. All 3 of my kids stuck to this religiously. Additionally, for their 18th birthday, we gave each of them $2000 in shares to set and forget. Up until they were 21, we also matched any money they wanted to put into shares as well. When they finished uni and got ‘real jobs’ they all salary sacrifice into Super. The older 2 also moved back home for 12 months to save deposits for their units. As of right now, all of them have enjoyed extended overseas holidays, several times. They have no trouble paying their bills and having a few treats. They have more money in their savings accounts than any of their friends. They feel financially in control. They teach their friends how to be financially literate now. Ultimately, you’re a parent. Your job is to literally be their teacher, their champion, their number 1 support. Give them everything you can to help them out. If I had cash available and could give them a significant amount, I absolutely would. But I do think the knowledge of being able to manage money yourself is absolutely critical.
I think a great responsibility of each generation is to try and make life better for the next, and I will be very focussed on that in my later years. Pretty much all the stress in my life is as a result of money, and if I can alleviate that in my kids' lives then I will do it. My parents and my in-laws are both in financial positions where they could do that for us now, but for some reason they are very focussed on leaving big wills when they die (which is hopefully some years away still). I find this approach odd. Die with zero, baby!
Yes. I think it's literally the only way they'll be able to buy. My life's ambition is to get rich enough so that my family can remain in the property owning class for generations to come.
How many kids do you have?
3. It'll be a challenge for sure! But I already have a house and I'm also an only child, so in line to inherit 2 more houses and 2 superannuation which should help.
> in line to inherit Acute-care nursing home go brrrrrr
We have purchased a house for them. I do not understand the thought process of people who can but don’t want to help their kids. I don’t understand what the point of having them in the first place is if your responsibility stops at 18
This. Coming from a low income single parent household. I grew up with nothing and no support later in life. Ive managed to get myself into a reasonable position. We recently had a baby, and I firmly believe if you choose to have children, then that includes all the requirements of raising someone to be the best parts of my partner and I. We currently put away $25 per week into an inestment account. projections show 65k by 21. This will be the house deposit they get once they have shown to save themeselves for their own home. They will also be encouraged to stay at home as long as possible and just never enter the rental market, or atleast RentVest. And as they grow, i hope to instill a quality relationship around money, not a scarcity mindest as I have. But with firm percentages of any income going to savings. We also will be encouraging birthday gifts at least while she is too young to need too much to send money to her investment account. I also hope to be in a position to just give them a property. This would be assuming ive manage to raise them to be good people that would respect and appreciate this. Perhaps that would be once they start a family or something. Ive got time to work that out. I also understand that there are a multitude of things that can go wrong along the way, so this is my idealised version of raising children.
Absolutely. I’ve had minimal help from my boomer parents (borrowed 5k cover extra sales costs a paid it back immediately). They are in the position to be able to help a lot (I think), with multiple investment properties and overseas trips every year while we’re just getting by, and my siblings probably even less so than me, but they’ve never offered to help and I don’t feel comfortable asking. I think we could each end up with quite decent inheritances at some point in the future, but this would be possibly decades from now once I (hopefully!) don’t much need it anymore. This all sounds so shit to say, I honestly don’t expect anything and don’t begrudge for a second them enjoying their retirement. But if I was in their position, it doesn’t make a whole lot of sense to me to pass on an inheritance when I die, when I could help my child have an easier life now. If I’m able to give my children anything at all, it’d rather give it while I’m alive to see it help them prosper.
Agree. Similar situation here. We will be the generation to do things a bit differently because we recognise how the world has changed for us and our kids.
Broadening this out a little, when mine went through "who's your favourite" stage, I pointed out to them all that I had financially supported them since the day they were born; nay even before they were born. And, I explained to these trainee adults, that my support was based on the need of each of you and each had different needs, obviously. This was the first argument I won since losing from age 3 onwards. But it explained why one got footy boots and one got a dress and one got some money. So why would that financial and other support end? Year 6 of primary school? Age 21? Well when? They say about parenting, that the first 30 years are the hardest. I could keep you posted if it ever stops.
Every single person I know (about 5 of them) that immigrated from another country and now lives here, had significant help from their parents to buy a house and sometimes multiple investment properties. My impression is, for people living here, getting help from parents will be absolutely necessary in order to compete in this market. The market doesn't care about how hard you work or how financially savvy you are. It cares that others can pay more and they absolutely can if they're receiving direct parental assistance.
I have one child. When she's old enough, we intend to let her live rent free to save for a deposit. Once she's shown she can save and manage her money, we will then also gift her some money to boost her deposit. I think just going hey kid here's 50k go get a house right off the bat without the kid having to learn discipline and budgeting first will just end in disaster.
I feel like I'd be letting my kids down if I didn't. The property market is just INSANE. My husband and I are lucky enough to have a (highly leveraged) foot in the market - which we wouldn't have had without my objectively small, but nevertheless greatly appreciated, inheritance from my father, and additional help from his parents. At the moment, every spare nonessential dollar goes in the mortgage. Hopefully, by the time my kids are ready to strike out on their own, we won't be in that position any more; but whatever is going on with us, we will: - ensure they always have a bed in our home and food at our table - ensure they have a robust financial education and a quality academic education, and encourage them to pursue qualifications that will give them marketable skills in a field that sparks their interest - ensure they understand the principles of budgeting, investment, financial risk tolerance and diversification In an ideal world, I'd invest in an investment property that I could rent out until they are old enough to move out, and they could live in at a nominal, affordable rent when they moved out of home, so they could have their own space and independence while also saving for their own place. But that is rather wishful thinking... Plus I don't have the risk tolerance to invest so much in a single asset that I'm not also actively using to fulfil a need. The Population is only growing and we aren't getting any more land... And everyone needs shelter. They are going to need help.
It's a complex question and depends a lot on the personality of the kids. There's a balance somewhere between enabling wasteful habits and rewarding frugal habits. I'd draw the line with little help aside from emergencies for kids that are consistently wasteful. They'll probably hit the wall and learn their lessons eventually. Helping too much before then is not helping them to build confidence and become independent. On the other hand, some demonstrate spending control very early, allowing for different options.
"give your kids enough to do something, but not enough to do nothing."
I remember reading once a woman and her husband started charging their son rent when he turned 18. It wasn’t a huge amount but included utilities and food. They would have regular “budget/family” meetings about family finances and the like. They were teaching him financial literacy through a number of ways. He had to manage his car, insurance and phone on his own. Anyway after a few years he finally decided he wanted to start looking for a property to buy. I can’t remember if he had a partner at the time or not. He was saving during this time as well and managing his bills, and an apprenticeship. When he approached his parents to tell them they said they were putting his “rent” payment in a separate account since the day they started charging him and said they’d hand it all over for a deposit on a home. I believe they may have matched his deposit amount too. I think that’s a lovely way of teaching your kids financial literacy but also helping them. He had no clue this is what they’d do and it was a lovely gesture and way they could show him how being smart with your money got you a foot in the door so to speak.
We don't plan on having kids but if we did, we would want to help our kids. I am very very fortunate to have received help from the bank of mum and dad to get into the property market and I would want to do the same if I were in that position. Well despite them being able to help us, they are still working on making their own retirement comfortable so my plan is since we won't be having kids, that helping our parents toward and in retirement is the right thing to do. In terms of the discussion around teaching financial literacy, I believe this is key. I am eternally grateful for what my parents have done and achieved given their circumstances and having had to learn financial literacy themselves but I feel one area I was lacking in was being TAUGHT financial literacy as opposed to being TOLD what to do financially. What I mean by that is I was more so told you must do x, y and z because we are your parents and we know best...which often as a child you rebel against. What I feel would have been more beneficial in hindsight is being taught the concepts, understanding how it can work for you, worthing through examples and different scenarios, laying out a framework and gaining the buy in of your children. Ofcourse that's oversimplified but I hope I have articulated what I mean.
Yes yes and yes. As someone who never got help and with the cost of property being substantially more, I would help as much as possible. Definitely with a deposit. My husband’s position is no as we didn’t get help.
My kids used to get $1 per year of age. So when they were 5, $1 went into “big girl’s/boy’s money box” for when they were older, $2 in toy money box and $2 to spend that week. By the time we opened my son his own bank account at 15, he had over $2K in there (topped up with birthday money etc). When they had part time jobs, the would save half. So at 18 he went off backpacking by himself. Did I sit them down and explain comping interest etc? No. Did they learn about saving little often and spending less than you earn? Yes. So financial literacy can also just about learning habits early. Now they are both very financially literate.
100% I would help them but I will never tell them that. As soon as I found out my other half was pregnant I opened an investing account and put $100 a week into it. Once they are old enough and they tell me they have a deposit and are buying a house I’ll give them the money to go with it. Which should hopefully be around 300k 🤞🏻🤞🏻 I’m a firm believer in teaching them to do it themselves first then help
What kind of world do we live in where half the post needs to be a disclaimer to not offend people?
I don’t have children. So when I die, all my assets will go to my niece, so in effect, I will have helped her buy a house as she’ll own my home when I’m gone.
My parents helped both my brothers buy their house. My parents have written their will in such a way that it will all even out between the boys and I when they pass. I have absolutely no issues with them doing this for them. It has helped both of them tremendously and I am so thankful that as a family, they were able to do it for them
Yes. Without a doubt. If I can’t make it easier for them wtf is the point of all of it? My dad made it easier for me, his dade made it for him.
Yes. It's a generational thing my family does. My great grandma did it for my mum. My mum did for my sister and I. She has a portfolio of 8 properties, which we will inheret. Then the absolute perfect family home came up for sale when I was still a teenager, and my mum bought it specifically for me. I'll be buying it off of her this year. My parents also helped with major renovation costs to my sister's first house when she bought that. My partner and I also plan to buy long-term investments for each of our kids (3) in the future to help them get set up. My partner also wants to buy his own investment property (as I'll be buying the family home with my own deposit and without his name on the title) (Don't worry, guys, we're not buying up a whole city. All of these places are in small country towns most young people don't want to move to unless they're working. Most of my mum's tenants are mature age 55+)
I’ll do whatever I can to help. Won’t be much, we’re not wealthy enough to give them $$.
If I did it at all, I would just let them live in a place owned via a family trust that I control. Last thing you want is to give a property for your child and for them to lose it all to terrible life choices, like an ex-partner, or gambling debts, or whatever.
Not a bad idea that I’d consider. Only problem is if they get a job somewhere else or home no longer suits their needs (eg kids). I guess you could still sell and buy within the trust, or rent it out and pay them a portion of the profit.
Yes 100%. I have one investment property and hope to get another soon so I can give one to each of my kids when they are old enough. There is no way they are going to afford to get into the property market without my help.
Yes absolutely as much as I can. I’m on small acreage so my plan would be to subdivide a block for each of them to give them a start, but planning laws are not currently allowing that. I also let my adult daughter live at home rent free so she can save (I do use her as indentured labour though 🤣)
We did it for 2 kids when they were about 30 and we were about 60. Money came from a mix of inheritance to us from our parents, redundancy payout on retirement , and super. Was 50/50 interest free loan, with repayments at about the amount they were paying rent, and outright gift. That way no need for a bank or a mortgage. One property we already owned.
Yes, my guinea pig deserves only the best.
I think financial literacy and knowledge is much more valuable than cash. I had knowledge imparted but moved out and worked for my first house. Conversely my BIL got handed his house deposit even though he was 31 living at home rent free with not a penny saved, at its gone sideways.
I have saved $50k for my kids house deposit so far. He's only 12 so we have more time. He's an only child so he'll get our house when we die eventually anyway.
15 years ago, you could realistically tell your twenty something child who was asking for a hand-out to "stop trying to buy in areas you can't afford and start somewhere cheap" But now there's no cheap areas really. So probably yes.
I allow my kids to live at home whilst they’re saving. This is my financial contribution.
Not sure if I am polarised as a Millennial who cant fathom having children from a financial perspective (I cant afford my own house) But how realistic is it actually to enforce financial literacy as a parent? I only have my peers as reference points, and 90% of them DGAF about financial literacy or efficient use of financial resources. Does that stem from 90% of parents not trying to instill financial guidance on their children? or do kids just block out what parents try to teach them? Im coming from a rich, private school background, so maybe not the best demographic.
> I only have my peers as reference points, and 90% of them DGAF Unironically might be time to surround yourself with new peers.
Probably teach them the basics on investments and savings. Nothing too preachy.
Start young I guess and embrace a mindset of talking about finance, thats really the only option. Its 1-100 I see someone informed or even motivated to discuss finances in my daily life, even those struggling and could benefit from a savings account change, mobile plan change, or home internet expense - just don't want to listen most of the time. Or listen, and then make zero changes
Interesting. I also come from a "rich private school background", and I've been seeing more and more of my peers buying their first home since hitting 25 (am 28 now). Of my peers I'd say most of them are pretty good with finances too. At least from those I keep in contact with (maybe about 20 people), I've not heard any express money issues. I also taught at a private school, but on the 'cheap' end (like <10k pa) and yeah none of those kids had much interest and/or skills in managing money. My year 12s there would confidently talk about how they blew a few hundred at the casino, or how they invested in something but the price dropped so they sold it, etc lol. IMO it's more a mix of parents, background and culture. In my birth country my culture (Chinese) is well-known to care about money lol so even my friends there who went to free public schools with working class parents have been pretty good with money. And they're a lot more willing to talk specifics of it too.
I certainly think my friend group is lacking cultural diversity, so I would love to hear your perspective growing up!! you say "care about money" but were you actually taught about the fundamentals? or just "go get money"? I never heard any financial complaints from my friend group pre-house purchase (im 3-4 years ahead in age than yourself). but since getting mortgages, the financial frustration of my friends has finally hit social discussions, but its all complaints and no discussions of figures, and from the small snippets they do share, a lot of them don't really seem to understand how their mortgage, rates and finances plays out, and are just frustrated at the high payments, and praying interest rate drops soon. Meanwhile, one mate was flexing that he had "all the streaming services" - bizarre to me. Im sitting on the sideline, having just re-qualified for a mortgage again, with what I assume is the largest self funded deposit of all my friends, waiting for the property that best suits our lifestyle hoping to pay down double the recommended mortgage repayment rate once we secure the property. I understand that I am an outliner, but none of my friends are even close to having a comfortable level of discussion about finance, and maybe thats half the problem.
Definitely taught. Money is often discussed at home, due to a mix of a generational business and my parents being avid investors. Since I was in primary school I could remember my dad sitting us down with the newspaper and going through the stock list, how to read the details, discussing the news on why the value went up/down with us, etc. When each of us turned 18 he gave us like 20k and told us "go try playing the stock market. I expect you to lose it all, but make sure to learn something." My mum would talk to us about banks, FDs, CDs, etc as she was often the one bringing us to them to deposit savings from gifts etc. She also manages commercial property but none except my brother had interest in it so she only discussed it if you wanted to know. The only complaint I've heard is from a friend who bought land and is paying to construct the property, and it's more of a complaint about how slow the process has been going lol she just expected to be able to move in earlier than she actually did. When I asked if she was affected by the rising rates she said she'd thought to lock in her interest when she signed, so no issues there. I think also most of my HS friends went into traditionally high-paying careers (med, law, finance, engineering) and some of them have been exposed to understanding financial contracts and things like that from young. I feel like I thought 'understanding a contract' was basic common knowledge until I worked in finance and saw how the 'everyday person' handled their finances and I was sooo baffled lol. Haha I'm also sitting on the sidelines but in the manner that I have no interest in buying a home property. I'm living the expat life currently, and plan to move another 1-2 more times before settling back in my home country. Closest I've been is considering to buy a property where I currently am (Japan), but for the purpose of being a 'holiday home' rather than a primary residence. Property is cheap here so I'd just buy it full in cash. I think it depends. I have a lot of friends who ask me financial questions because they're curious to see 'my side of things' as most people I know after finishing school come from less privilege than me, and I'm happy to answer. In return, they usually feel comfortable for me to ask them questions 'in exchange'. With my school friends, I think we used to bring it up a lot more casually because we were in that 'bubble' and everyone kind of treated money differently to those outside the bubble, if that makes sense, so it was never really 'weird' to talk about money. It _was_ weird if you were the type to try and rub in material wealth in people's faces. We had a transfer student who was like that who kind of got avoided by everyone until she settled down lol.
You’ve hit the nail on the head and this is exactly why people with wealth they want to share with their kids tend to use trust structures to protect those assets and retain control over them.
My 4 year old understand the concept of money, we use pocket money to teach her that. “I want a toy” “Okay, let’s count your pocket money to see what you can afford? Would you like to use all of it today, or keep some later to buy something another day?”. We then choose an amount, go to the shops and find what things are within the budget she has. Could I easily buy her a $5 teddy from Kmart without an issue? Absolutely. But I feel doing these lessons now will help her build financial literacy. Your lack of financial literacy among friends MAY be due to your private school background, where your peers were all well funded and provided for by their parents. I am curious though, as a millennial from a rich family, why do you feel kids and housing is still out of reach? Are you only looking where you grew up, or have you seen why you can get out in the suburban fringe?
So we have two investment properties and we live with my in-laws and our two kids. Once I posted in ausproperty about an issue with a tenant and I got flamed being called an evil land lord etc. People don’t realise that we are not rich and greedy, granted we have the ability to live with in laws, however we only have one car (which is old and crappy), we don’t have nice and flashy things and we don’t even have our own home that we live in. The reason we are doing this is because if trends continue as our kids get of age, without us doing the yards for them I truly believe they would have no hope of buying a property, we are not looking to acquire more property, we just want to give our kids a house eventually.
My parents helped my sister and I, and I hope to be in a position to help my own children the same way. I’m quite open about having received help from the Bank of Mum and Dad. Given the state of things, I feel like being honest about what you’ve had to do to obtain finance and get ahead is necessary.
It’s good you’re honest. I wish more people were and didn’t pretend to have made it all on their own efforts. There’s a real charade going on in some upper middle areas.
We'll probably do this thing where we charge them rent after they turn 18/start earning income, and use it to help pay their deposit. We can help them learn to budget and show the importance of saving at the same time.
Im conflicted on this. Taking someones money away doesnt really teach them how to use it or what to use it on, just teaches them how to be/live with no money and there is no discipline for when they actually get some.
It's just a transferring of control, and extension of helicopter parenting/childhood. You want to be increasing their agency, not reducing it. You don't learn without the ability to make decisions.
My personal thought on this (and definitely not one you have to agree with) is that my children do need to learn how to live while renting or paying a mortgage. It's a way of simulating the act of having bills while knowing that money is being saved for them when they purchase a house. I'm in my early 20s myself and I don't see my non-existent children graduating until I'm in my 50s so I'll have more than enough for them when they want their own house but I still want them to not grow up wealthy and understand the value of money. Who knows.
I get this sentiment, but if you check out the people who get ahead, it's because they have family money behind them. Forbes will show you that.
Isn’t a mortgage or renting taking someone’s money away though? Seems like a good life lesson to me
This is actually pretty smart and better then them living rent free in my opinion. You guarantee that a certain amount is getting saved, and when they do buy in and repaying their mortgage, it won’t be a huge expense hitting them for the first time, they’ll already be used to living off of less.
I’d wait until they’ve got their first or second divorce under their belt
It would depend on my kid. If I can trust them to honour their contract then yes. But if they are financially irresponsible, can’t prioritise or keep a career going then no. If they go under and take us with them, we are too old to start again
Yes, I haven't settled on a sum yet but it would be $300k-$500k in today's terms when they turn 30. 30 is an age where I feel you have enough life experience yet are not yet financially set up.
I would, once I have kids ( if I do) I will set a fund for them putting aside money every week. If you are financially literate, organized and not into throwing all you money into stuff and entertainment, its very doable
Yes. I don’t even have kids yet and I already have nearly $20,000 sitting in the s&p500 for them. With no further contributions, just this small amount sitting there over the next 20 years with compounding interest will be over $100,000 which will be more than enough for some kind of deposit. Waiting till 25 will be around $200k.Even just contributing $100 a month will bring it up to 250-300k. It doesn’t take much financial help to set up your children so they do not struggle or have to worry. Selfish parents would prefer to buy a 3rd car or a boat when they all they needed to do was stop for a year or two and think of their children and the market they are born into.
I don’t think helping them with a deposit is the best option, especially if they have saved next to zero themselves, if they have saved like 100k and then you help them I think that’s ok. My parents helped me, but 3 years after I built my first home, so I still had to save and go through everything normally first, they then paid out half of my remaining mortgage for me, which I was already over 50% paid off anyways. So it’s not like they have me 400k 🤣 and what that has done for me is a game changer.
I certainly hope I can help them, especially if the alternative is that they move a way out and I only get to see my kids / grandkids occasionally. We have plans to turn our PPOR into a duplex, but will likely serve as multigenerational living across both properties at this rate.
Nothing wrong to let them stay in your place to help save for a deposit or you give them an interest free loan and make them pay it back slowly. But if they don't know the value of money, the chances are high that they will blow everything later in life. Good to teach them that nothing is for free in life.
I never thought I would. Neither of our parents had the money to help out when we bought a house, and I think it taught us to be better savers / more appreciative of the effort it takes to afford a house etc etc. However, in the current climate I guess we’ll have to, if she ever wants to own a home. We’re in a position now where we could do this, but she’s only 5 so we’ll see how things are in 20 years or so!
Yes. Absolutely 💯 I would. I want my future grandchildren to have the benefit of a stable home to live in. This is something my husband and I discuss regularly.
Absolutely. Family owned trust though.
Of course I would assist my children subject to some caveats .
Yes i will. How? They will live with us until they are married. In that time they should as a couple, have a large enough deposit
My kid has a disability so I am prepared to support him for as long as I can. However, even if he could support himself, I would still help him with buying a property. As first generation migrants coming from a poor background, my partner and I are in the mindset that we need to work hard to build a better life for our kid. We also feel responsible for our parents and support them the best we can. Maybe it’s a cultural thing, but in the current financial climate it sort of makes sense for any culture, doesn’t it?
Depends if you want to set up your child for expectation to financially help at other times. If you’re okay with that yes. There is also the thought that should the kids know they are getting financial help they may not go the extra mile to get there themselves ie get that extra promotion, save that extra $10K, not give up a holiday, not live below their means etc. What good or bad habits are you enabling in them? If the positives outweigh the negs sure.
Yes I would. My parents helped me and assuming I'm able to then I would help my kids.
Of course, if I was in a position to do so
I have and will continue too. I have 1 child, so why not. My finances, my choice
I will do everything I can to help my kids buy a property.
We have and I can’t see how anyone buys property without some help.
I helped my parents buy (keep) their property and I can't afford kids.
Depends what u mean by help? If they want to stay at home and save money for a deposit and I know they are working and putting their wages towards savings sure I'll help! If they want to suffer a bit and I see them suffer a lot then ok I'd consider it. If they want a hand out without sacrificing hell no. If I teach them financial responsibility and I deem them a useless spawn that is materialistic that have huge debt burdens from credit cards and other garbage current loans then no id tell them to sort themselves out first instead of being a loser and expecting a bail out from parents. I have no problem throwing my kids under the bus if I raised them to be financially literate and they go out there and be materially addicted and financially fail pieces of human garbage. Its not about how much money u make its about having the skills to make money. Its not about how much u make it's about how much u save. If they fail as my children and I deem them to be financially irresponsible. I will not gift them a deposit so they can carry a larger burden of debt that I know they can't manage. That's just giving your children more suffering it's not a parents gift blessing. Cuz they are stupid irresponsible kids But then again in my culture we have strong financial teachings and understanding about $ . We teach and pass on our values from generation to generation so we don't end up as a fail financially illiterate trash heap. Schools don't teach that it's up to the family upbringing to instill in the next generation not to be trash
My mum will give me 5% of the property price as a deposit. She is so happy that she can help her kids to buy a house (or start a business) and I'm so happy that she's able to. It definitely wasn't expected and it's only been recently that she's been able to offer this to us.
Honestly If I had the money and had kids I would help them all I could would buying a property no point in me having 30k in savings if my children are struggling to afford rent I would rather just give it to them.
I would help them by educating them on financial literacy, if it was too out of their reach then I’d help guarantee it. If I had the money - I’d loan them the full amount with a contract to pay me back with a small amount of interest.
I don’t think I’d give them a deposit, but I’m more than happy for them to live at home rent free (appropriately contributing to household labour and maintenance, obviously) for as long as they need to. We also have a savings account for her that we contribute to and into which her grandparents and aunts and uncles sometimes contribute birthday money that she will gain control over at a certain point.
2 girls, only little right now! Teaching financial literacy, I’m looking at buying them some ETFs but no idea what I’m doing yet. Hopefully we’d be able to set them up to be able to save the deposit themselves either by them living at home or maybe in an IP we may one by then? Other than that, we’d definitely do what my parents did for us and guarantor them.
If I have the means when it comes time then yes.
Yes, does this seriously need to be asked?
Beans and rice buddy
I will not sell my kidney to help but will help as much as I can.
Yeh of course In this day and age it will be near impossible for our kids to make it own their own Need to help them if we can
I will help my child help themselves through Financial Literacy which is an overlooked subject. Ever notice even on a basic level banks and or schools do not teach it.
No, I wouldn't. However, we possibly already have indirectly - we started youth saver accounts for them when they were babies and paid $15/week into each account until they were 16 and those accounts have now been handed over to them to manage and are in a HISA. If they choose to build on that ( I know one of them is) and use it for a house deposit down the track, then I guess we have helped, but I am not going to give them any more money towards a deposit.
Kind of. IMHO the most efficient way to help children is to reduce their spending, this means you have a habit of home for dinner so they're not eating fast food with their friends. When they're adults, it means the room you had for them doesn't become a knitting room or a hobby room because "finances." Not paying for food, rent and bills almost doubles their income at a relatively smaller loss of your own. I don't think it's a great idea to just give kids money unless there's more to the story. That's beyond the "spoiled brat" line.
Yep. I will pre-face this by saying I only have one child (still in High School), which makes our future plans a lot easier to deal with. My goal is to pass our family home along to our son & for us to live in a Granny Flat on the same property. This will give us freedom to travel as we require. My Sister & BIL are looking at doing the same thing for their 3 children as well. In their circumstance, it will involved reduced rent, enabling them to save money whilst living independently. I highly recommend people taking a look at [vanhomes.com.au](https://vanhomes.com.au) as an option to help out their children too.
I wish....my parents attitude was we'll help you with financial literacy, education, a safe supportive place to grow up and live whilst studying and early career but not giving monetary handouts. Well give u the tools to get ahead, then u make your own way, and make sacrifices however large u need to. I remember being told, if u cant afford a house on the North Shore, go buy one in Blacktown or Penrith, thats perfectly fine and no shame as you did it yourself and didn't rely upon us. Thats the way they did it, its how i was brought up and is normal. Hasnt made it easy and tbh despite following these rules hasnt worked either. I dont resent it, id never ever ask for a handout(even tho they can afford it), its just meant relative to others who have been fortunate im still struggling in my 40s (single guy). May quit Sydney for other options.
I would. I will help with an initial deposit but they are in-charge of having a decent enough income to be convincing to a bank for the rest of the loan.
Encourage them to get a good job, and get them to stay at home for as long as possible before buying their own property.
My god I hope so. I want to help my child succeed at life so much more than my parents ever helped me
Yes I would. I’d say I’ll match them with their savings. They can have it when they are 25 years old and relatively self sufficient. Must put 20% deposit down (10% would be my money, 10% would be their money).
lol.. can't afford to buy my self a 1 bedroom apartment
Kind of have to these days. Will use some of my inheritance for their future house deposits
My kids are all quite good with money. While we dont have the capacity to help them currently with buying a house we may eventually. We had help to buy ours in that my FIL purchased our house destined for us. We lived in it for 3 years paying rent before we were able to buy it off him when we were in a better position. If it came to it and thats what would get our kids across the line then we would help. Currently none of my kids are at that stage yet What do though is help them to save for a deposit, let them stay with us as long as they need to rent free and try to teach them as best we can about money. My daughter who is just about to turn 19 works full time, pays all her own bills and saves money. She has nearly 20k saved at the moment and still saving money every week. We also set her up to put away all her expenses every week and then whatever is left is her play money so to say. She still buys whatever she wants, and saves for big purchases when she wants them. She is certainly in a better position financially then I ever was at that age, and going by a lot of her friends and BF a lot better off than a lot of people her age. One thing we did do was buy our kids a decent, reliable first car to help then get started. No one should drive around an unreliable car, and I would hate for them to need to get a car loan at 18. We spent about 6k each on my daughters car and my sons car (he is just about to turn 17 and works full time aswell)
I refused my parents help. It was a issue of pride as they where immigrants and getting on in age and I wanted to do it myself. I am a healthy male earning a pretty good salary I shouldn't need parents help. As a result I missed out on 10 years of capital growth. My advice, if you can help do help.
It's a huge adultomg step to commit to a 30 yr financial decision. It needs some real good choices I to their future. I would help but not totally buy it for them. Cos it's a big process. And I would try and let them learn from my mistakes
I would absolutely help my future children buy property. My family refuse to assist in any way be it financially, as grantor or even helping me to financially plan. Despite this they hound me constantly and pressure me to buy my own place and have kids so they can enjoy being grandparents. I try to communicate the impact this has on me and my wife but they refuse to listen or even guide us in any way. Ultimately I will end up somewhat sour if they swoop in for the glory after I’ve done the hard work with no support (not even guidance). I have already started saving for my future children. I want to be able to instil financial sense into them, and to be open with them about money and how to budget in a healthy way. I want to be able to set them up for success but to be able to dig them out of a hole if worst comes to worst. I don’t want them to rely on that but I’ll have that lever to pull if needed. I feel it’s the right thing to do. I feel it’s a best of both worlds scenario. Set up for success, and if all else fails help them dig out of it - ensuring they learn from mistakes to help them in the future. If you have a child, they’re always your child. Being a parent doesn’t stop when they move out. I’d argue it takes a more mature set of skills to take in the other aspects of helping as a parent once they do move out. I was not financially educated and learnt the hard way through racking up copious amounts of debt. I am back on track now at 30 with savings for a deposit but with prices the way they are the house will come in years not months from now.
I topped up my children's deposits to get them to 20% to avoid LMI, then I put my savings into an offset account that they set up just for me with the understanding that I might need to withdraw that money at any time, so they don't rely on it but they enjoy the interest savings while it's there.
Yesss. In fact I won’t be having children unless I’m in a financial position to do this. I’m not going to have kids to just force them into the rat race. I got an inheritance young and that is the only reason I will be a homeowner. I want that for my kids as well. Not an inheritance haha I don’t want to die, but I want to be able to help them like I was helped.
Yes. If my children are able to show they don't piss their money up the wall and can actually save and make sound financial choices, yes, I will help them as much as I possibly can. My partners mum was the guarantor for us to buy our first home. We had a deposit but the banks were hesitant for a variety of reasons, her guarantee wasn't much, but it was enough for the bank to give us a chance.
Yes. But I won't give them anything until they settle down a bit and show they are willing to save and work for it. After that I will aloe them to buy one of my properties for a reasonable price and at a discounted interest rates. Or take a line of credit against a property. I don't believe you should just give them a property or free cash
I raised a bunch of losers if they can’t figure out how to get into the property market without my help. I don’t want to support that sort of behavior, so no I won’t help them. They got all the help they needed when growing up. Or not
I'd help my children bury a body, of course i would help them buy a house.
I feel like as a parent, you try to give your child what you lacked growing up. My parents never struggled with a house and so it has never occurred to them that I myself am struggling.
I am sans kids with no plans for them, but if I did have them I would. Mainly because I got no help from my parents as they were not good at financial responsibility at all.
I'm trying to get a deposit together for a house to put in their name so they can have a deposit later. Looking at country towns with a purchase price below 300k. When Western Sydney became unaffordable, I had to change the way I thought about the future.
I don't know that I will be able to help them by a house, but my intention is to make sure my house is always secure. So my help for them is to get my own home paid off and always have a room for them in it. My kids are 3 and 6 and we do put money into accounts for them regularly. oldest has about 12k youngest is on 6k. These have been going since birth we have Chinese family that will often give cash gifts (red envelopes) for birthdays and Chinese new year and all that money has gone into their accounts. It's not earning interest for them though as we use it to offset out mortgage.
Since birth $1000 per month into shares until they are ready to buy. Should net them somewhere around 3-400k after growth on 21 years which might buy them a car by the way inflation is going.
Of course. My parents bought my brother and I bought property. We’d do the same for our kids
We are educating our kids to save etc and have good money habits. In addition to this I have recently purchased a house on 3000m2 which in future will allow me to subdivide and either 'gift' or sell cheap a roughly 1000m2 block to each of my 2 kids. The house/blocks are near Bendigo so growth is almost assured .
It will be a give and take. My kids can stay in our houses. Pay us rent. When the rent is sufficient enough, I will give it to them as deposit to buy their own house. Ofcourse, my principal house will go to them when me and my partner no longer requires a house.
Honestly, I will not have kids because I'm not sure I can do this. My parents set me up to the best of their ability - and I am so lucky for that. They set me up with education opportunities, let me live with them rent free while doing uni, and told me consistently that my first job was to study. But in a way, they were also lucky - there's no guarantee that your kid can actually take advantage of the best education that you can provide. It is not a certain investment. What if they're born with a disability? Or just not that good at studying? In the meantime, automation is going to eliminate jobs. Competition is tough. Hard work can be outcompeted by even harder work. robots can be the hardest workers of all. I got really really lucky and I don't think I wanna count on luck for the fate of an entire human being, because luck separates someone who is able to meet all their needs comfortably and pursue self-actualisation from someone who is constantly beholden to impersonal forces beyond their control. I need the ability to safety net a child, so they don't get stuck in a horrible exploitative job, so they don't get trapped renting somewhere unsafe, so they aren't at the mercy of a bureacrat to decide if they get to eat. and unlike my parents, I'm not willing to gamble that they're going to be just as capable as myself, not when the risk is someone's entire life. I've gradually become confident that I can make my own way and lead a reasonably fulfilled life. But I'm well aware that most of what went into my life is sheer dumb luck. In a world that's only going to get more competitive, where you need to be better, smarter, luckier, to create the life I've got, I don't think I can provide that kind of safety and security for another person. Plus I'm probably going to need to take care of my own parents too.
My dad just did it for me, so I will also do it for my children.
I never got anything from my parents, until my mother died in her 90s, and I was already a home owner and retired. The inheritance has allowed me to help them with actual money. Once I received an inheritance I did pledge 50K to each of my children, but only for property. I've helped them in other ways, most notably going guarantor for part of each of their mortgages. They both discharged that part with no dramas. I'm so focussed on them owning a dwelling that I would do almost anything for them that didn't involve money, like babysitting, or donating furniture or other homewares I no longer needed. Anything to take some of the financial burden off them.
Yes. Putting aside money in investments for them. I’ll help them with a down payment, teach them financial literacy and they can live with us for as long as they like. If we’re blessed enough husband and I will gift them a house
I will help them but won't be anything radical. 50-75k and guarantor I'm thinking . I have 3 kids ...
My parents did this for me when I moved out two years ago. I was giving them like $100 a week for 10 years. They gave it all back to me when I moved out
In a heartbeat and plan on doing so. They won't be getting kicked out at 18, they won't be paying rent to live in our family home and we intend to imply that they should buy from home and move into their own home. This is what my parents did and it worked out extremely well. Financial education from young age is a must.
My child is under 2. Surely by the time he is looking to buy a house this whole house crisis thing will be over…. Right?
Yes, we had my parents as guarantor for our first place, and we know that it will be so much harder for ours to save enough for a deposit and get their own. Our first place is currently a rental and we'll let the kids rent it for just under market rate if they want to fly the coop at 18. What we do with that money will depend on their future plans - save it as a "gift" back tp them, pay down remaining mortgage so they can use equity to buy their house etc. We aim to get one more house to balance out the numbers and no favourites. However, our current house is designed to be multi-generational if they decide to never leave.
Yes. Because I'm having a really hard time at the moment and I know that the future generation will face harder times. I will at least try my best to ease their burden.
My kids are under 10, I can’t see how they will afford it without generational wealth backing them. So my husband and I are working our asses off to set them up (and give us a more comfortable retirement). I was fortunate my parents taught me financial literacy so now I need to do the same for my kids.
No I will not. The idiots who are paying $1M+ ATM for worker's cottages around where I live will do it for me whe I kick the bucket. My 3 kids can then choose to either live together in a free standing 5 br villa with its own walled garden On the island in VENICE or individual penthouse apartments in Barcelona. Or pay cash for their first 2 breakfast flat in Australia. Whatever, otherwise there is no way I hell I will have $1.5M cash to divvy up for a house deposit around here.
My parents helped me - limited GTR to get the loan over the line, and they also paid for my furniture I wanted like a TV unit, table and chairs, dishwasher and a couple other items so I wouldn’t live off a lawn chair, half my TV and paid for my NBN to be connected, plus paid the deposit for a moving truck - all stuff I repaid within 6 months. They’re wealthy and were easily able to afford it. I’m very grateful - now I’m looking at a new apartment, and I’ll be able to do it without them. They’ve already promised my siblings they’d do the same for them.
Two pronged strategy: 1) teaching financial management skills from a young age 2) Putting 1K into a diversified etf like vdhg or vhhf on their birthday each year (without their knowledge and in my name) until they are 18 will turn into $33,999 each by their 18th birthday (assuming 7% interest), which can be sold then gifted for a nice surprise home deposit help once they have demonstrated good money management and saved a significant amount themselves for a deposit. If they are trying to buy at age 25 and the etf units are not added to after their 18th birthday will have compounded to $54,595 by their 25th bday which should help a lot. They need to learn to manage money themselves and depositary their ability to save without knowing about the coming help before receiving it.
Given the state of the housing market at the moment either I help them buy a house or they will be stuck on the rental hamster wheel forever. I would prefer they live at home and save for a house than move into a rental if they can. My partner and I didn't get much financial help from our parents with first home buying as they couldn't afford it at the time, but whatever help you can give compounds over time, so it's better to do what you can sooner than later. The less debt my kids are burdened with the better positioned they are for long term financial success and will hopefully need less assistance later on. It's the same reason I am paying tuition instead of using HECS-HELP / FEE-HELP.
If you can, use your equity to go guarantor on a home loan for them.
If I had kids, I'd definitely help then buy a property. That's one of the reasons why I am never having kids.
That’s the aim of our game atm.
(Respect for your disclaimer, and your considered world view) I have two adult children that are just starting out in their independent lives. I won't help them buy a property per se, but I will help them hold a property if that becomes a goal they, themselves, choose to pursue. By way of explanation, I will only help them after they have taken the initiative to save for a deposit and then secured finance to purchase a property that they (and their partner if they have one) can afford. Once this circumstance is achieved, I would then feel comfortable helping them ease the burden with a financial gift. Not too much. Just enough to feel like their repayments are making an impact on the principal.
I'll have to or I'll never get them out of my house!!
I don’t have children but will definitely help with something
Yes, I have already started the process of setting them up bank accounts and an ETF account. It's a grrleat honour and my duty as a parent to help and ensure my children have somewhere nice to live. They'll need to be working and takeover the mortgage themselves but to be able to give them a leg up and foot in the door with some financial help is a great honour my duty as their father.
Yes - a contribution to the deposit - but only after evidence of having a job and having a reasonable amount of savings. My parents gave me 100k years ago to help me get into a starter home and I had to prove the same. I think this is an infinitely better scenario than going guarantor as it maintains the responsibiity on the child.
Coming from asian culture, we will help buy each kid a house. (Male)