In this article:

The rise of the “Bank of Nan and Pop” shows how many grandparents are stepping in to help with housing, study and everyday costs, especially as younger Australians face rising financial pressure. But while this support can be meaningful, it also needs to be balanced with realistic planning for retirement, health costs and later-life independence.
More Australians are supporting younger family members earlier in life, whether through money, accommodation or practical help. For many grandparents, that support feels generous, meaningful and timely. But with retirement becoming more complex and future health and care costs harder to predict, families are also asking an important question: how do you help the next generation without putting your own financial security at risk?

For many families, this support is thoughtful, generous and deeply valued. It can ease pressure during expensive life stages and create opportunities that may otherwise feel out of reach, particularly as younger Australians navigate rising costs and financial uncertainty. 

This shift reflects a broader change in how families are managing financial challenges. With housing, education and everyday living costs continuing to rise, support across generations is becoming more common. 

In many households, what was once occasional help is now a more consistent part of how families work together to manage financial demands.

52% of Australian Grandparents

are either offering or planning to offer financial support to their grandchildren

Source: MLC Financial Freedom Report 2024

Why are more grandparents helping earlier?

Supporting children and grandchildren financially has always been part of family life. Grandparents have long helped with school costs, milestone expenses, temporary accommodation and practical support during difficult periods. 

What is changing is when and how financial help is being offered.

Rather than waiting to pass on wealth through an estate, more grandparents are choosing to intervene earlier, knowing that their support can have an immediate impact and that they can see the impact of their investment during their lifetimes.

For some, that means regular cash contributions. For others, it may mean paying down debt, helping with rent, covering travel or offering a place to live while grandchildren get established.

2025 Just Better Care Retirement Report

For a wider perspective on how financial security, independence, and later life priorities are evolving, read What Matters Most to Australia’s Future Retirees or browse the 2025 Retirement Report commissioned by Just Better Care.

This shift makes sense in the current environment. Younger Australians are dealing with higher living costs, pressure in the housing market and growing uncertainty about what financial independence looks like. 

In that setting, family support can feel less like an optional extra and more like a practical way to help younger people get a leg up and navigate important life stages with greater confidence and financial stability.

How early support can make a difference?

  • It can help grandchildren build stronger financial habits.
  • It may support major goals such as study, travel or entering the housing market.
  • It allows grandparents to see the impact of their support.
  • It can create healthier conversations about money, responsibility and future planning.

What does the “Bank of Nan and Pop” say about modern family life in Australia?

This MLC 2025 Financial Freedom report paints a more nuanced picture of financial well-being in Australia. 

Many younger Australians are feeling the pressure when it comes to money, particularly as the cost of living continues to rise. At the same time, support from grandparents has become more common, creating a strong link between financial stress and intergenerational assistance. This financial support is often practical and ongoing rather than a single, large contribution.

Common ways grandparents are helping

  • One-off financial gifts.
  • Regular contributions towards everyday expenses.
  • Support with travel or family holidays.
  • Help with childcare, school fees or university costs.
  • Assistance with housing or accommodation.

While each contribution may seem modest on its own, together they can make a meaningful difference in helping younger Australians manage rising expenses and move forward in the next phase of their life with greater confidence. 

The numbers below highlight just how widespread this shift has become.

49%

of Gen Z worry about their finances all the time or often.

60%

of Gen Z have received some form of financial support from grandparents on reaching adulthood.

70%

of retirees are budgeting or cutting back spending.

Financial support can be a powerful expression of love and care. But when decisions are made quickly or emotionally, families may not always stop to consider the long-term effects on the grandparents providing financial help. 

A kind decision can still cause pressure later if it limits the flexibility needed regarding medication costs, housing adjustments, or access to professional support at home.

Helping family without putting retirement at risk

One of the clearest messages in this conversation is that generosity and financial security need to be considered together. Older Australians are living longer, and retirement is not just about everyday spending anymore. 

Retirement also needs to allow for future health expenses, changes in living arrangements, transportation needs, home modifications, and support at home that is the preferred option for many older Australians.

This matters even more because many older Australians still carry financial obligations of their own. 

Housing pressureS FOR OLDER AUSTRALIANS

2x+

More than twice as many Australians aged 65 and over now carry mortgage debt compared with 20 years ago.

18% → 25%

The proportion of older Australians renting increased from 18% to 25% over a 20-year period.

What this means

Housing security is no longer guaranteed in retirement, and financial commitments are increasingly extending well into later life.

These changes have important implications for retirement planning. Ongoing mortgage repayments or rental costs can reduce financial flexibility, particularly when combined with rising living expenses and potential aged care needs in later years. 

Many retirees are already adjusting their spending or feeling they may need to work longer to cover future costs.

Costs that may need to be planned for in the later years:

  • Hospital care, treatment and recovery costs
  • Home modifications for safety and accessibility
  • Transport, vehicle upgrades or alternative travel needs
  • Relocating, downsizing or adapting living arrangements
  • Ongoing or unexpected healthcare and support expenses

Talking about Aged Care sooner rather than later

Start a conversation about what aged care could look like in the future with our guide. How to Talk About Home Care with Your Family

Gift, loan, guarantor or accommodation: what are the trade-offs?

There is no one-size-fits-all way to help

Gift

Some families prefer giving a gift because it feels straightforward and generous.

Loan

Others might choose a loan, especially if there is an understanding that the money will eventually be paid back.

Guarantor or accommodation support

Some grandparents may consider acting as a guarantor or offering accommodation so grandchildren can save money faster.

Each option comes with different implications

Gift

A gift may feel straightforward, but it can also affect future entitlements or create fairness issues among family members.

Loan

A loan may preserve capital in the long run, but it can also introduce tension if expectations are unclear.

Guarantor support

Acting as a guarantor can help a younger person enter the property market, but it may create significant financial risk if they experience financial hardship and that burden shifts back to the grandparent.

Questions to consider and ask before giving financial support to your grandchildren:

  • Is this support a gift, a loan or something in between?
  • How will the arrangement be explained and documented?
  • Could it affect your pension status or income and assets assessment with My Aged Care?
  • What happens if circumstances change unexpectedly on either side?
  • Would professional financial advice help clarify the best approach?

If accommodation is part of the plan, there are other practical questions as well. 

Shared living can be very beneficial, especially when housing costs are high, but it can also impact privacy, retirement plans, household expenses, and future downsizing. These matters should be discussed upfront with a clear timeline, so both parties reach an agreement.

When support is not equal, clear communication matters

One of the more sensitive parts of intergenerational support is fairness. 

If one grandchild receives help with education, another receives help with housing, and a third receives less direct support, families may worry about whether everything feels balanced. 

This is why open communication matters. Families may not need to make everything identical, but it helps when the reasoning is transparent and any legal arrangements are kept up to date.

Useful Next Step

If your family is starting to think about future support, independence and aged care options, read Questions Families Ask About In-Home Aged Care or speak to your local Just Better Care office.

Money is not the only support grandparents can give

Not every grandparent is in a position to provide financial assistance, and that is important to acknowledge. Support can also come through wisdom, guidance, encouragement, practical help and open conversations about money, work, resilience, history and planning for the future.

In many families, the most lasting contribution is not necessarily financial. It is often the example set by someone who has lived through challenges, managed money carefully and developed a long-term perspective on life.

These experiences can shape how younger people think about saving, debt, housing and long-term security. They can also influence confidence, resilience and decision-making in ways that go far beyond money.

Ways grandparents can support beyond finances

  • Sharing financial wisdom and life experience
  • Helping younger family members build confidence
  • Encouraging healthy habits around saving and budgeting
  • Providing practical support during major life changes

In that sense, a living legacy can be as much emotional and practical as it is financial. It can be built through consistency, openness and the kind of support that helps families face future challenges with more confidence. 

Frequently Asked Questions

Families often have questions about financial support, retirement planning and future care needs. These FAQs highlight some of the most common considerations when grandparents are thinking about helping younger family members financially.

Why are more grandparents helping younger family members financially?

Many younger Australians are facing high housing costs, rising everyday expenses and financial uncertainty. In response, more grandparents are choosing to help earlier in life through gifts, regular contributions, accommodation or other practical support. This growing trend is often described as the “Bank of Nan and Pop”. For broader context, see What Matters Most to Australia’s Future Retirees and MLC’s Financial Freedom Report 2024.

What types of financial support do grandparents commonly provide?

Support can take many forms, including one-off gifts, regular cash payments, help with education expenses, support with rent or accommodation, contributions to a home deposit, or practical assistance during major life changes. In some cases, grandparents may also consider a loan or acting as a guarantor. Each option has distinct financial and legal implications, so it is important to think carefully about which option is sustainable.

How can grandparents help without putting their own retirement at risk?

The key is balance. Support should be considered alongside future retirement costs, housing security, healthcare expenses and possible support needs later in life. Grandparents may benefit from setting a clear budget, discussing expectations openly and seeking financial advice before making major commitments. For more on planning ahead, read Planning for Retirement and Home Care Costs in Australia.

Is it better to give a gift, offer a loan or act as a guarantor?

There is no one-size-fits-all answer. A gift may feel simple, but it can affect fairness across family members and, in some situations, government entitlements. A loan may preserve capital, but it can introduce tension if expectations are unclear. Acting as a guarantor may help a younger person enter the housing market, but it can carry significant financial risk if repayments become difficult. Professional financial advice is essential, and with guidance from an accountant or financial planner, families can be better informed and compare their options more clearly.

Can helping family affect pension or social security entitlements?

It can. Gifting money or assets may affect pension or other government benefits, depending on the amount and timing. Rules around gifting, assets and income tests can be complex, so it is important to understand the implications before providing significant financial support. The most current government information is available through Services Australia’s gifting rules. Professional Financial Advice is also strongly encouraged regarding these rules and your personal financial situation before making any decision which may impact your future.

What if grandparents want to help with accommodation instead of money?

Offering a place to live can be very valuable, especially when rents are high. However, it is still worth thinking through the practical and financial impact. Shared living arrangements can affect privacy, household costs, future downsizing plans and retirement lifestyle. Clear conversations about expectations, responsibilities and timeframes can help avoid misunderstandings later.

Why do families need to think about future care costs at the same time?

Retirement planning is no longer only about everyday living expenses. Future costs may include healthcare, transport, home modifications, changes in living arrangements and support at home. Thinking about these needs early can help families avoid situations where generous support now creates financial pressure later. For further reading, visit Support at Home Program Australia and Questions Families Ask About In-Home Aged Care.

How can families start these conversations constructively?

Open, early and honest conversations usually work best. It helps to talk about priorities, expectations and possible future scenarios before decisions become urgent. Families may want to discuss financial support, housing, independence and future care needs together so choices feel balanced and transparent. A useful starting point is How to Talk About Home Care with Your Family.

What if grandparents cannot offer financial support?

Financial support is only one way grandparents can make a difference. Guidance, practical help, emotional support and open conversations about life, money and resilience can be just as valuable. In many families, these contributions help younger people build confidence and good habits that last well beyond any one financial gift.