The Bank of Grandma and Grandad: What You Actually Owe Your Adult Children
A story crossed my desk recently that I haven’t been able to stop thinking about. A grandmother, writing anonymously on the forum Gransnet, described a year spent quietly propping up her daughter’s young family – taking them into an outbuilding on her own property after they returned from a month-long overseas holiday confessing to $9,000 of debt, paying to install a bathroom for them at her own expense, offering childcare so the couple could work their way back to solvency. Nine months in, her daughter announced a second, planned pregnancy, and when the grandmother’s reaction wasn’t jubilant enough, she was screamed at and called selfish for not wanting to take on two small children full-time while her daughter returned to work.
I want to sit with that story for a moment, because underneath the drama is a question I think a great many of you are quietly wrestling with, minus the outbuilding and the shouting match: how much do you actually owe your adult children, financially, and where does generosity end and your own retirement begin?
You are, statistically, not alone in this
Here’s what the research actually shows, and I think the numbers themselves are worth sitting with. One Australian survey found that 94 per cent of grandparents provide some form of monetary support to their family each year – yet strikingly, 79 per cent of those same grandparents didn’t describe themselves as someone who “financially supports” their family at all. Which tells you something important right away: most of you are already doing more than you’d admit to a stranger, because it doesn’t feel like a loan or a gift when it’s your own daughter standing in your kitchen looking exhausted.
More broadly, Australian research from the Institute of Family Studies found that around one in five people receive occasional or regular financial help from family in a given year, with support flowing overwhelmingly from older generations to younger ones. Half of all survey participants actively endorse the idea that families should support one another financially in times of genuine need. This isn’t some fringe behaviour. It’s close to the cultural default.
What’s actually being asked for
If you’re wondering whether your own situation is unusual, it almost certainly isn’t. The most commonly requested forms of help, across the research, cluster around a fairly predictable list: everyday living costs when a family is doing it tough, help with a home deposit or getting into the property market at all, education costs, and – increasingly, and this is the one that catches grandparents most by surprise – regular, ongoing childcare that quietly functions as financial support even when no money changes hands directly. Two in five grandparents provide childcare for grandchildren under 13, and that figure climbs to nearly two-thirds when the grandchild is 10 or younger. Every hour of free childcare is, in effect, money you’ve chosen not to charge for.
Interestingly, Australian grandparents lean toward gifting rather than lending compared to some other countries – we’re more likely to simply hand money over than to formalise it as a loan with an expectation of repayment. There’s something quite telling in that. It suggests many of us would rather absorb the loss outright than have the awkward, ongoing conversation about repayment terms with our own children.
The part nobody wants to discuss: protecting yourself
Here’s where I want to say something that might feel unromantic, but I think matters enormously. Australia is currently in the middle of what’s been described as the largest intergenerational wealth transfer in the country’s history, with an estimated $3.5 trillion expected to pass between generations by 2050. Family lawyers report a genuine, growing trend of parents and grandparents insisting on a formal Binding Financial Agreement before handing over significant money, specifically to protect that contribution if a relationship later breaks down. A decade ago, this would have seemed distrustful, almost insulting, to suggest to your own child. Increasingly, it’s simply considered sensible.
I don’t think wanting a written agreement, or even simply calling something a loan out loud rather than letting it drift into an unspoken gift, makes you ungenerous. It makes you someone who has worked for decades to build what you have, and who is allowed to want some clarity about where it’s going.
What I actually want you to take from the Gransnet story
That grandmother wasn’t selfish. Nothing in her story suggests otherwise. She had already given an outbuilding, a bathroom renovation, nine months of childcare and enormous emotional labour, and the one thing she declined to commit to in advance was full-time care of two small children indefinitely, on top of everything else, while genuinely exhausted. That is not a withdrawal of love. That is a boundary, arrived at after a year of extraordinary generosity, not before it.
If you’re navigating something similar right now, here is the only real test I’d offer you: are you giving because you genuinely want to, and can afford to without quietly resenting it six months from now? Or are you giving because saying no feels like it would make you the villain in a story you never agreed to be part of? The research is clear that helping family financially is normal, common, and often deeply meaningful for the person doing the giving. What it doesn’t say, anywhere, is that the giving is supposed to be unlimited, undocumented, or offered under duress. You’re allowed to be generous and still have edges.
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All I can say to the grandma in the story is ‘creating a rod for your own back’. There is a firm line between generosity and being taken advantage of. More people need to learn that “no” is a complete sentence, no explanation required, children or no children. Gran has done her time of child rearing and deserves to enjoy her retirement, not start all over again.
My wife and I (in our mid 60’s) are doing all of the above x 1000% for our adult children and our grandchildren and love helping them. They great kids and grandchildren bring so much happiness in our retirement. We don’t keep tabs and we call it ‘living inheritance’, & more importantly we don’t feel guilty when we spend like crazy on our enjoyment while you can see the stress on their faces doing their daily rituals. There is enough to go around in this world so important we all share & care. Don’t have expectations when giving otherwise there will be many regrets. Young people are wired differently compared to us babyboomers.
My wife and I have helped out our family financially a lot over the last 30 odd years . Our thoughts on the moneys given out is that it is gone and if we get it or some of it back good if not well so what . We still have our family around us and the love and security is great .
That lady’s story is a great example of how the generation after X expect to be taken care of. They think it is their right and the slighting term of Boomers has arisen. Where is the granddaughters own parents. This woman needs to turn her out. Apparently we boomers are not dying on schedule.
However I bought a house with my son to help raise his two small children. They were just 2 and 4 when the mother walked out. Apparently is was all too hard for her. At the same time my husband’s dementia was increasing so we helped each other out. That was 8 yrs ago He has a mortgage. I do not. Then SARS II hit and with a new job he couldn’t meet the payments any more and I then contributed to it. It is all written down and legally noted. When we sell the house he will repay me from the profit on his half No free rides
We are in our 80s and over the years have helped out with our 5 children and their families, either with time, or money, as they needed, whenever we could, no problems.
Yes, we all try to do our bit to help our Children. Unfortunately, some take advantage of you. I have leant money to my Daughter, which she will have her loan through later this year to pay back. Some will go into my account, as it is my savings for a trip overseas. But some, I will transfer to my Great Granddaughter, for her future. Her Parents work hard, and are not struggling as such, but have been through a hard time, due to my Great Granddaughters Cancer Treatment, which has been in Brisbane. Lots of costs of travel and their own House Payments. I do have some Step Great Grandchildren, and when I visit, will always give some money to put into their Savings Account. Have helped both my Children, and Step Children as well in different times. My Parents did the same when we grew up and had our Families. One thing, we can`t take it with us, and it is better to give now, than have it sitting in the Bank, and the Tax man (Government) get most of it.
Seems like the grandmother is on her own. Much easier if there is a couple managing that situation.
Every relationship that bears children usually have 2 sets of grandparents (GP) most of the time. Both sets of GPs have have different levels of abiluty, capacity, capability, financial and time and other resources ( handy persons skills) to aid, support, next generations. Different cultural , religious, financial values apply between generations especially when GPs lived in another state, country etc. Extraordinary ill health, education, social needs may arise . I have 4 children and 2 grsndchildren, a family trust set up to ensure that at the end of mine and wife's life, all 4 kids get equal 25% of my estate cash up value. 1 out of 4, in the GLBTIQ + is self funding lifestyle as trained chef and Licensed building practices. No4 children earns more income than me, age for age and already self funded own home with mortgage loan. No 3 daughter is most vulnerable with PTSD, mild Bipolar, had 2 of my grandkids (GK) with 2 different fathers - both now separated with joint custody arrangements. No2 child getting married this year. I support no3 child and 2 GKs 75% of their annual lifestyle budget until GKs leave home. My mental health daughter will be on government benefit for life. She gets get 25% share in drip feed fashion now until I die, but in totality not more than 25% of my estate- she just gets it in advance!! In my memorandum of wishes, after both my wife and I pass on, the other richer children can contribute to poorer ones for their retirement ?? That's my plan.
Jack, you are a nice man. Family matters can sometimes be very complex but you have your heart in the right place and you are doing your best to be fair to all. Just don’t forget to keep living your life as well and don’t forget to have a comfortable & peaceful life in your later years.
This Grandmother has no "children" - what she has is descendants, grown adult descendants. I once asked a quite rich man( friend) what he was going to do with his money when he dies. He said he was going to leave it to his kids. I told him that he was 80 years old, still quite healthy and will not die just yet and he has no kids . He had 59yo and 57 yo descendants who are aging as much as he is
Initally we offered our grandaughters our house for 6 months to rent to give them an opportunity in the rental market at a very reduced rent.
However we told them that after the 6 months the rent would need to be increased but they would have first option to stay. After 6 months one of our grandaughters left for overseas so we let the other grandaughter stay paying minimal rent untill she found another tenant. However she has not yet found "someone suitable" and i feel we should put a time limit on her paying the ineased amount as previously agreed. We told her not to panick but to try to find another tenant as soon as posdible. Are we right to put a definite date for the rent increase? Thank you
OMG ! Gran it's time to go off on a nice long holiday of your own. You've done over and above and owe them nothing. Don't let them use your grand children to feel guilty either. Draw the line and stand your ground.
This exact thing happened to my friend and now she is totally estranged from her daughter and two grandchildren. I've sold a property to help my son buy a house and I've looked after two grandkids two days a week for years. I'm always spending money on them. They are now 12 and 15 and love coming to my big house. Some people to tell I should draw the line and say no, but it's not worth a family confrontation. I don't want to end up like my friend and her daughter, saying things to each other that can't be forgiven. The good thing about best friends is they know my situation and don't bother preaching to or judging me. Pretty soon the kids will be grown up and be heading out with their own friends, and that's ok.
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