Recently I’ve met a couple of families who are being challenged by Centrelink’s rules about gifting…
Both parents were trying to help their kids get a foot in the property market. Parent’s being parents, helping our kids is what we do. Right?
One father was ready to just sign away his rights to around $90,000 of equity. The others were ready to stump up $30,000 so their son could buy a ‘better’ first home…all without understanding the Centrelink impacts on them personally.
As both an adviser and parent, I find the constant giving to excess more a little hard to understand, particularly when it’s detrimental to the parent’s financial well-being!
The way I view it is, all parents have an obligation to say ‘no’ when saying ‘yes’ is detrimental to their own financial well-being.
Expecting Mum & Dad to be the ‘bank of last resort’…the people you get money from when the bank says no…is not how parents should be seen by their kids. It’s not a great way to demonstrate, or encourage, personal responsibility… and the kicker is, there’s next to no chance of getting your money back!
If you intend leaving a balanced Estate, so your kids will keep speaking to each other when you’re gone, you may have to say no more often!
