Setting financial boundaries with your adult kids
Written and accurate as at: Dec 11, 2025 Current Stats & Facts
It’s natural to want to help your kids, but if that support continues into their adult years it can be difficult to know when and where to draw the line. If you’re nearing retirement and have unwittingly taken on the role of ATM for your children, here are a few things to consider.
Why boundaries matter
To start, you’ll need to think about how your assistance might impact your own retirement. Dipping into your savings too much now can leave you less financially secure later on.
And if you wind up having to accept a lower standard of living in retirement, it could see your relationship with them taking a turn for the worse.
But even if your savings can take the hit, having clear boundaries in place is still essential. After all, if your child comes to expect financial assistance as a given, you might start to feel like they’re taking advantage of you.
There’s also the matter of your child’s own independence and maturity, and how relying on you a little too much can reinforce the kinds of behaviours that many people outgrow earlier in life. Being able to handle setbacks and live within your means are vital life skills, and if your kids come to believe the Bank of Mum and Dad will always come to the rescue, those lessons might elude them.
Managing expectations
It can be difficult for your kids to hold up their end of the bargain when they’re not aware there’s a bargain in the first place. Instead of keeping any expectations vague or unspoken, make sure you clearly state what you’re willing to do to help them, and what you expect in return.
When tough love might be needed
As a parent, the sacrifices you’ve made for your family are probably too numerous to count. While your support over the years will hopefully be appreciated, there may be times when some tough love is required.
Often this will take the form of a simple two letter word: no. This can be difficult to say, but it’s not in you or your child’s best interests for them to see you as an endless source of funds. Ideally, this will help them learn to stand on their own two feet, and also accept that your support is merely a safety net, not a supplement (or replacement for) their salary.
When your adult kids are living under your roof
It’s common for young people who’ve been squeezed by the current cost-of-living crisis to return to the family home – and for parents to want to help them. But even if it was your idea for your child to move back in the first place, that doesn’t mean the arrangement has to be open-ended or financially one-sided.
Once again, a useful approach is to be frank about your expectations early on. Before your kids pull up to your driveway, IKEA furniture in tow, ask them: when do they think the arrangement will end? What’s their ultimate goal? What steps are they taking to get there?
For example, if your child is staying with you while job-hunting, set a timeline and include clearly defined obligations – say, six months of support with a certain amount contributed each week to cover a portion of the bills. If they find a job in that time – great. If not, you’ll need to reassess the plan as a family.
Alternatives to gifting money
Like all money decisions, you'll need to factor in your personal circumstances before deciding how much you can help your kids financially. If you’re worried about dipping too far into your hard earned retirement savings, the good news is that there are other ways you can help out. Here are some ideas:
- Acting as guarantor if they want to buy a home: This can help get their home loan application over the line if their deposit falls short of the 20% lenders like to see. Just be sure you understand the risks involved before agreeing to anything.
- Offering practical support: Non-monetary assistance, such as looking after grandchildren or even offering financial advice and guidance, can reduce stress and help put your kids on stronger financial footing.
- Lending instead of giving: If you do want to give your kids some money, consider lending it instead of offering it as an unconditional gift. Before you do, however, make sure to consider any tax and Centrelink implications.
At the end of the day, it’s your money and it’s up to you what you do with it. However much or little you decide to help your kids out, the most important thing is that you’re comfortable with the decision – and aren’t sacrificing your own financial security or peace of mind in the process.
