When Pete and Margaret’s son Josh found his dream home with his partner Robin, they were over the moon. They were so happy. And when Josh asked if they could help with the deposit, they didn’t hesitate.
They’d just retired and withdrawing $98,000 from their super to help their son seemed like the right thing to do. It was a big decision – and they felt a little nervous – but the joy of helping their family outweighed any concerns. At the time, they just wanted to say yes.
What they didn’t realise was just how much that yes would cost them.
When Good Intentions Go Wrong: The Importance of Planning
Josh and Robin bought the house and settled in. Everything seemed fine… for a while. But when the relationship broke down and the house was sold, the leftover money was split between the two of them.
If everyone had taken the time to fully understand each other’s situation, some of these misunderstandings might have been avoided.
Pete and Margaret were shocked. They thought the deposit was a loan. Josh said it was a gift. Emotions ran high, conversations broke down, and the result was heartbreaking: not only did they lose their money, but they lost contact with their son for nearly three years.
It wasn’t until much later that they started rebuilding their relationship – and their finances – with the help of a financial planner.
What Pete and Margaret Wish They’d Done Differently
This is a tough story, but it’s not uncommon. And the truth is, there were ways to avoid it. Here’s what they wish they’d done:
1. Got financial advice before saying yes
A financial planner could have helped them understand how a $98,000 withdrawal would affect their retirement income, including any fees associated with financial advice or superannuation withdrawals and helped them explore other ways to help.
2. Put a loan agreement in place
A simple document – even between family – could’ve protected everyone. It might have included repayment terms specifying how and when the loan would be paid, or even secured the loan against the property
3. Talked through the gift vs. loan decision properly
Even if it was a gift, there are ways to legally set conditions (like if a relationship ends) and understand any tax consequences.
For example, a written loan agreement could have outlined the debt, repayment schedule and any interest, so everyone knew how much to pay and when, and it helped avoid misunderstandings.
The Bigger Picture: Planning for Retirement and Helping Family
We know how much people want to help their kids – especially when big life moments come along. But generosity shouldn’t come at the cost of your own financial future. That’s where planning comes in. Before making big decisions, it’s important to get a clear view of:
- Your current finances – income, living expenses, living costs, debts, assets, taxes
- Your retirement income strategy – super, Age Pension, investments
- Your financial goals – what you want your retirement to look like and how to get there
Most people underestimate their living costs, so it’s essential to include them in your retirement plan. Having a comprehensive retirement plan that considers your retirement age, savings and how much you need to retire comfortably is crucial. Regularly reviewing your account balances, especially debts and savings, helps you manage your financial situation effectively. Contributing to your super – and contributing regularly over time – can make a big difference to your retirement savings. Consider how your money is invested, and remember that investing wisely is key to building wealth for retirement. You can access resources and support from Services Australia for financial information and guidance. Comparing super funds can help you optimise your retirement savings and make sure you’re on track to meet your goals.
Why Professional Guidance Matters: The Role of Financial Planners
Navigating the world of financial planning can be overwhelming, especially with the sheer number of financial products, investment options and ever-changing rules in the Australian financial services landscape. That’s where a financial planner steps in – not just as a guide but as a partner in shaping your financial future. A financial planner takes the time to understand your current financial situation, your financial goals and your risk tolerance. They use this insight to create a financial plan that’s tailored to you, whether you’re looking to grow your super fund, explore managed funds or simply make sure your retirement lifestyle is secure. With so many choices – like understanding the concessional contributions cap, transfer balance cap, or which investment strategy suits you – having expert guidance can make all the difference.
But a financial planner’s role goes beyond just investments. They can help you work out how much income you’ll need in retirement, recommend the right mix of other investments and make sure you have the right insurance in place – like health insurance, income protection or cover for critical illness and permanent disability. This holistic approach means your financial security is protected from all angles, not just your superannuation fund or super account.
One of the most important things to know is that financial planners in Australia are required to act in your best interests as set out in the Financial Services Guide. This means their advice is designed to help you achieve your goals, not just sell you a financial product. When choosing a financial planner, always check they hold an Australian Financial Services Licence (AFSL) – this ensures they have the right qualifications and experience to provide high-quality financial advice.
Life changes, and so should your financial plan. A good financial planner will review your plan with you regularly, making adjustments as your circumstances, goals or the financial landscape evolve. This ongoing support helps you stay on track whether you’re planning for retirement, managing current living expenses or preparing for unexpected events.
In the end, working with a financial planner is about more than just numbers – it’s about building a financial strategy that gives you confidence, clarity and peace of mind for the future. With professional guidance, you can make informed financial decisions, protect your financial security and achieve the retirement lifestyle you’ve worked so hard for.
Building a Financial Plan That Works For You (and Your Family)
Financial planning is more than just numbers on a spreadsheet. It’s about making sure your money supports your values, your goals and your loved ones – without risking your future.
A solid financial plan includes:
- A personalised investment strategy
- Smart, proactive tax planning (and if you own a business, consider business-related tax strategies to optimise expenses and investments)
- Ongoing reviews and rebalancing as life changes
- Risk management, including insurance and estate planning
Ongoing education is also important – for both individuals and financial planners – to stay up to date, competent and compliant with the latest financial regulations and strategies.
And yes – it can include helping your kids if that’s what you want to do. But with professional advice, you can do it in a way that protects everyone involved.
A Happy Ending (and a Fresh Start)
After some time, Pete and Margaret reached out to Josh. They talked, forgave and began to move on. Josh now has a new partner and a baby on the way – and Pete and Margaret are going to be grandparents.
They also feel more in control financially. With the help of a financial planner, they restructured their portfolio, created a realistic retirement budget and have a renewed sense of confidence. To maintain their financial stability, they set up automatic payments so all their bills and debts are paid on time.
They can’t turn back the clock – but they’ve made peace with the past and are planning forward with purpose.
The Takeaway: Generosity Needs a Plan
At Insight Wealth Planning, we understand how personal these decisions are. We help families create strategies that honour their values while protecting their future.
Whether you’re thinking of gifting money, helping your kids onto the property ladder or simply planning for retirement – we’re here to guide you with clarity and care.
Contact us to start the conversation. Because the best financial plans aren’t just about numbers – they’re about people.