Grey nomads are often referred to as the SKI (spending the kids’ inheritance) generation, and new research shows that most older Australians aren’t keen on the idea of trimming back on their retirement spending to help their offspring.
The survey conducted by AMP found that, despite wanting to support their children, seven in 10 Australians aged 65 and over were unwilling to compromise their own lifestyle to provide financial assistance.
This despite the fact that 80% of Australians aged 65 and over believe rising housing unaffordability and rents meant their children were facing similar or harder financial challenges than they did growing up.
The primary means through which they are willing to support their children is by providing a place to live in the family home.
But retirees also hold a strong attachment to the family home, with a reluctance to downsize to release funds to support their children.
AMP says this new research highlights the attitudes, behaviours and conflicting priorities impacting the transfer of wealth and financial support from older Australians to their children and grandchildren, with those over 60 set to transfer an estimated $3.5 trillion over the next two decades.
The findings match with Productivity Commission data showing 90% of all intergenerational wealth transfer occurs through death inheritance, typically when children are aged 50.
Key findings from AMP’s research include:
AMP Director, Retirement, Ben Hillier said the key going forward was to give retirees the financial confidence that their savings will last, will not only help them live life to the fullest, but also give greater clarity with how they can help their kids.
“As housing unaffordability and cost-of-living pressures rise, Australia’s burgeoning retiree population faces a growing dilemma – how do they help their kids financially, while also fully enjoying their retirement years,” he said. “Unlocking different options for financial support, beyond accommodation, starts with older Australians having greater comfort with their own finances … we know, for example, far too many retirees are unnecessarily fearful their savings won’t last their lifetime.”
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We worked 2&3jobs to get my lifestyle and had second hand furniture no tv or expensive electronics & only bought when we saved up and paid cash the entitled generation needs to reduce their spending and work harder
I agree, we did the same.
But, we did help out our children, when I retired, when we had the funds, which is all paid back.
We sold our house in Brisbane and gave our kids enough money each to help them buy a house. They need the money now, not in 30 or 40 years when they get their inheritance. We have enough savings, super and investment income to do us, and we are more than happy our grand kids will not have to suffer their parents scrimping and saving, arguing over money and going without.
NO! because both of our married kids have bigger more modern houses & cars than us.
Not something that can be resolved by a silly survey. Parents will do whatever they think is right for their children, their relationships and circumstance when it arises. Sooo many variables and issues that affect all of us that can’t be categorised in shlock sensationalist media.
We have helped our kids buy houses and have recently moved and downsized to help with grandchildren. I’d love to see a survey on how many boomers are helping with grandies. When is enough?
Would i cancel or postpone a big trip to help my children, the answer is NO, My wife and i worked multiple jobs to pay off our home early so we could give our kids the life we didn’t have, nothing was left out, when they married we helped both financially and sadly one lost out in a divorce while the other prospered, but that is life, We don’t offer assistance outright but i’ve told them both we are here if you ever need help. This is now our time, your time, enjoy life.
Think twice before selling your home to get money to give your kids. You may lose your pension. The family home is not considered in your assets for means testing for the pension, but a wad of cash would be!
My son left home at 18 but came back at 21 to ask for help. I taught him how to program computers and gave him a career he still enjoys. What do they say “Give him a meal and feed him for a day. But give him a fishing rod and you feed him for life!”