When you imagined your retirement, along with the holidays, spare time and freedom, you may have also imagined helping out your loved ones.
However, a new study of older Australians who are still working shows that what we hope for in retirement and the reality sometimes don’t quite match up.
An industry fund survey found that 72 per cent of older working Australians with children were planning on helping their kids out financially by drawing down on their super or savings.
More than a third of the participants said they hoped to leave an inheritance for their children (36 per cent), while 29 per cent were planning on helping pay for their grandchildren’s education.
The remainder said they would like to gift their children with a holiday, or help them put a deposit on a house.
However, only half of the Australians who are soon to retire say they will only be able to afford a “modest” retirement, which is defined by the Association of Superannuation Funds of Australia (ASFA) as a lifestyle where a retiree can afford basic requirements plus private health insurance, a reasonable car, good clothes and a range of electronic equipment. They can also afford occasional international travel.
Having extra to help out the kids is probably beyond this standard of retirement for most people.
Damian Hill, the chief executive of REST, which commissioned the survey, said while it was admirable to want to help your children, retirees should remember that the primary purpose of superannuation is to fund your own retirement.
“Using retirement savings for other purposes may mean they become a financial burden on their own children later in life,” Mr Hill told Fairfax.
Do you hope to help your children out financially? Is this likely to be possible?