As home prices exceed the reach of young people, many families turn to the "bank of mom and dad"—a term for financial support from parents to their children. The scale of this "bank of mom and dad" in Australia is currently estimated at USD 23 billion.

A study by the University of Newcastle in Australia, conducted in Sydney, revealed that the average financial assistance provided is USD 49,000, with the lowest at USD 3,300 and the highest around USD 330,000. While most of this support comes from middle and upper-class families, many parents with limited finances still strive to help their children.

However, the study found that many families do not clearly define whether the money is a gift or a loan. Most agreements between parents and children rely on trust, lacking formal contracts or written records.

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Doctor Julia Cook, representing the research team, stated that both parties sometimes have different understandings of the same financial contribution. Some parents expect repayment, while their children consider it a gift. Some amounts initially designated as loans are later implicitly treated as gifts when children face difficulties. "A frank conversation rarely occurs", Cook noted.

Elizabeth Shaw, Chief Executive Officer of Relationships NSW, explained that parents often avoid discussing repayment terms or methods specifically, fearing their children's embarrassment. Consequently, the money contains "hidden strings" and becomes a source of conflict.

Family lawyer Gabriella Pomare in Sydney highlighted that legal issues typically surface only after major life events such as separation, financial hardship, or a death. If a child divorces, parents find it difficult to prove that the financial support was solely for their child and not a joint gift to the couple. Conflicts can also easily arise among siblings when one receives money without the others' knowledge.

The greatest risk lies in the parents' own future. Pomare has seen many parents give money to their children right before retirement without fully considering their future needs. When their health declines and they need the money back, they have no mechanism to compel their children to repay it.

Experts advise families to clearly define, in writing, whether the money is a gift or a loan. If it is a loan, the agreement should detail the recipient, the amount, interest rate, repayment period, and method. Pomare also recommends seeking independent legal advice before transacting large sums of money.

"Starting with a difficult conversation is better than a costly argument at the last minute", Pomare said.

Shaw suggested that sometimes a better way to help children is not to deplete savings, but to support them in finding financial advisors and developing money management skills. "There are many financial options, and family should not always be one of them", she concluded.

Nhat Minh (According to ABC News)