Families can be complex, but no matter where you fit into your family tree, it’s important to understand that the financial decisions you make today can have a lasting impact on the people you love – from your children through to ageing parents.
Ideally, every family member should be folded into the financial advice process, letting your entire clan benefit from expert advice across every life stage.
Supporting children from infancy to adulthood
All parents want to protect their children, yet a surprising number of families don’t have guardianship plans in place for their young ones.
It means if both parents were to pass away unexpectedly, a child can be placed in the harrowing situation of being shunted from one well-meaning relative to another. In the worst case scenario, it could be left to the Family Court to decide who raises the child1.
Put your Will under the spotlight
Having a Will is especially critical today as more Australians live in blended families, and you need to be very clear about exactly who should benefit from your estate.
Children with special needs require additional consideration, and under these circumstances a testamentary trust can provide ongoing financial support.
A financial helping hand – choose wisely
As your kids grow up, chances are your thoughts may turn to giving your adult children a financial helping hand to buy their first home.
A range of options are available from gifting all or part of a deposit, lending a hand with loan repayments, acting as guarantor on their home loan or agreeing to pitch in as a co-buyer.
Each option can come with significant ramifications, and frankly, you need to be mindful of your own financial security when deciding to help your child achieve this significant milestone.
This is an area where financial advice is a sound investment – for all parties involved. If you’re facing this situation, or you’d like to discuss options that can help you contribute to either a first home purchase or pay for your child’s education, contact your local FinChoice Financial Adviser for tailored strategies.
Be sure to visit Mortgage Choice's First Home Buyer's Information Centre. There you will learn about taking advantage of government grants and much more.
Ageing parents – don’t wait until decisions need to be made urgently
At the other end of the spectrum, increasing life expectancy may mean many Australians need to spend time – and often money – caring for ageing relatives. It can be an emotionally-charged experience, and it’s an area where forward planning can make a tough time less challenging – and more certain.
An essential first step is to consider encouraging your ageing parents to put enduring powers of attorney in place that they are comfortable with, and it makes tremendous sense to have this in place long before your parents can no longer make independent decisions.
Without power of attorney in place, you are locked out of your parents’ financial affairs, and you may be left facing expensive bills for their care.
Navigating the complexities of aged care
It’s also a good idea to sit down with your parents and discuss the issue of aged care accommodation.
Waiting until nursing home care is desperately needed is not a solution as the cost of care can be prohibitive, and it’s definitely an issue to address before the situation becomes an emergency.
Contact your local FinChoice Financial Adviser and they can help put valuable plans in place to protect your family.
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