Plan for retirement while supporting your parents with theirs

If your parents’ savings and assets aren’t enough to support their retirement it could become, or already is, your problem.

As a result, you may be forced to put your own retirement plans on hold while focusing on your parents’ financial wellbeing instead. But this may have a counter-effect.

That is, sacrificing your own retirement savings to help your parents may in turn cause you to rely on your children for support. And so the cycle continues.

Fortunately, there is a way out.

Here’s a few things you can do to help both you, and your parents, in having the best chance of retiring comfortably.

Do the math on your/their retirement savings

Not sure if your super will last the distance in your retirement? Our Super & Retirement calculator may provide a guide on the super balance you might have when you retire and how long it might last.

For your parents

You’ll need hard numbers in order to assess the situation properly. Developing a budget spreadsheet of your parents’ expenses and income, will enable you to see exactly where they stand financially and how long their money is likely to last. You can also use our Super and retirement calculator to help you with this.

If there is a deficiency in their income, you might want to consider working with them or consulting a financial professional to help them to manage their money better. This may include setting up an emergency fund to cover medical expenses for instance. They may also want to consider downsizing their living arrangements by selling the family home.

For yourself

Identify how much you’ll need in retirement and whether you’re on track to meet it by using our Super and retirement calculator.

If you find that you’re going to fall short, you may want to consider investing more into your retirement savings than just the compulsory 11.5 per cent employer contribution.

By contributing additional amounts into your super from your take home pay or your before-tax income, you can get access to substantial tax benefits and potentially move closer to achieving the lifestyle you want when you retire.

Insurance to cover medical expenses in retirement

One of the most important things you can do, if nothing else, is to ensure that your parents have appropriate insurance.


If you don’t invest in financially protecting your parents now, you may end up paying a lot of money later on to cover basic retirement expenses. In particular, healthcare costs are becoming increasingly expensive so it may be in your best interest as well as theirs.

If you find that they may not have enough insurance to cover medical expenses, long-term care and other retirement costs, you may want to consider putting this in place.

Discussing elderly care in retirement

While your parents may want to retain their independence in retirement, at some point assisted care may become necessary.

Retirement homes and assisted living facilities can be expensive, so if this isn’t going to fit within your budget, you may need to consider other options. One option could be that they move in with you or a sibling for instance. You may also want to investigate whether they meet the requirements for government funded housing support.

Eventually, many of us may find we are called on to help ageing parents and other relatives. Planning ahead can help relieve some stress down the track.

Explore the financial costs of funding home care and options for private funding.

Getting professional help with retirement planning

Sometimes it can be difficult to manage these pressures alone, especially when it affects your financial stability.

Enlisting the help of an expert, such as a financial adviser, may assist you in developing appropriate strategies to ensure you’re meeting your own retirement objectives as well as those of your parents. They may also identify if your parents are eligible for tax concessions or other government benefits.

Finally, set boundaries to ensure your own retirement doesn’t suffer

While you may want to help your parents, it’s important to consider setting boundaries and be clear about expectations so it doesn’t affect your own financial future.

There’s nothing wrong with being willing and able to help, but be clear about what that help consists of. If you help them too much, then it could be your children who pay the price.

Next: How much do I need in retirement?

Related content

Thinking about retirement, but not sure where to start? Get tips and information in our Planning for Retirement guide, to help you get started today.

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Things you should know

The article was prepared by BT and is current as at 1 July 2024. 

This article provides an overview or summary only and it should not be considered a comprehensive statement on any matter or relied upon as such.           

This information does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness, having regard to these factors before acting on it. This information provides an overview or summary only and it should not be considered a comprehensive statement on any matter or relied upon as such. This information may contain material provided by third parties derived from sources believed to be accurate at its issue date. While such material is published with necessary permission, no company in the Westpac Group accepts any responsibility for the accuracy or completeness of, or endorses any such material. Except where contrary to law, we intend by this notice to exclude liability for this material. BT cannot give tax advice. Any tax considerations outlined above are general statements, based on an interpretation of the current tax law, and do not constitute tax advice.