Canadians may love their children, but a majority would rather spend big money than have those kids fly back home to the nest as adults.
In a new poll from CIBC, 65 per cent of respondents with a child aged 18 or over said they'd prefer to give their children money than have them live at home with their spouse or partner.
The old ethic that "children should make their own way in the world" seems to be going out of fashion.
Seventy-six per cent of respondents say they would give or have given support to their adult kids to move out, or marry or live with a partner. Only 24 per cent said they wouldn't give any financial support.
The average gift size parents have given or would give their children was $24,125 nationwide. In households with incomes above $100,000, the average gift size is $40,558.
Standard operating procedure
In the current era of skyrocketing house prices, gifting money to children has become standard operating procedure for many.
A survey from HSBC published earlier this year found 37 per cent of Canadian millennials said they had asked their parents for financial help with housing, and another 21 per cent said they had asked their parents for money for unexpected costs after purchasing a home.
Buying a home was the single most common reason — from 23 per cent of respondents — cited for giving money to children in the CIBC poll. Weddings or cohabitation with a partner were the second most popular reason for gifting cash, at 16 per cent.
But that doesn't mean Canada's parents are an open ATM. In fact, 55 per cent of respondents said they're uneasy about monetary presents. The top concern? Forty per cent worry they may need the money themselves later. Another 29 per cent said they fear their offspring won't use the money "wisely."
"The caveat to making any financial gift is that you generally don't want to put your own finances at risk," Jamie Golombek, managing director of tax and estate planning at CIBC Wealth Strategies Group, said in a statement. "You need to map out the lifestyle you want in retirement and the money you'll need before making a financial gift."
Tax benefits
Golombek suggests such gestures may be a good idea, especially since financial gifts to children (as well as other relatives and even strangers) are tax free.
"Unlike in the U.S., we don't have any kind of gift tax, which means if you have what's called 'never money' — money you'll never spend in your lifetime — it's worth considering making a financial gift while you're alive to help your kids get started in life," he said.
"In addition, by gifting assets before you die, these assets will not be subject to probate fees because they will not be part of your estate."
All the more reason for Canadians to line up at the "bank of mom and dad."
How Millennials Can Save Money
Deal With Debt First(01 of10)
Open Image ModalYou may feel like saving is impossible with that huge pile of debt sitting on your back, but unless you take care of it first, you won't be able to plan out a clear financial future. "High debt levels will slow down your saving and investing abilities when you start working, so do everything you can do to stay out of debt," says author and financial coach David Campbell Lester. Obviously, this situation isn't ideal for everyone — especially students who take loans during the school year and don't find full-time work right away. Once you graduate, talk to a financial planner to figure out how much you should save each month, and if you're a student, talk to your school's career centre for part-time work or look for grants or scholarships. (credit:AndreyPopov via Getty Images)
Get A Money Mentor(02 of10)
Open Image ModalThis can either be someone who works at your bank or someone you know who is really good with their money. Meet with your mentor once a month and discuss your challenges and successes thus far in terms of your career and finances, Lester says. And although it may be a little embarrassing to share your savings and debt numbers with someone you know, remember, we've all been there at one point. (credit:LDProd via Getty Images)
Get A Part-Time Job That Will Benefit Your Skills(03 of10)
Open Image Modal"When in school, get a part-time job that will complement your career when you graduate, and give you cash to keep out of debt," Lester says. Although getting part-time work can be tough during the school year, try looking at jobs on campus that can work around your schedule, and give you more skills in your preferred field. (credit:David Lees via Getty Images)
Build Credit(04 of10)
Open Image ModalIf you love your credit card and treat it like a best friend, make sure you're using it for the right things."Build credit by paying your mobile, cable, internet, and other fixed costs on your credit card and then pre-authorize a full payment at the end of the month," he says. Don't make of habit of paying for everything on credit — especially if you can't pay it off. Also, when you are looking for a credit card, choose one (or two) that will benefit you with either points or a cash back feature. Credit can be your friend, as long as you don't create a hole of debt. (credit:Wavebreakmedia Ltd via Getty Images)
Use Cash And Debit For Everything Else(05 of10)
Open Image ModalIf you know you have $100 a week to spend on food, coffee, entertainment, etc. then leave that amount in a "spending account," or take it out in cash every Sunday, Lester says. If you are the type of person who is more likely to spend cash if they see it in their wallet, start with a small amount, like $20 to $40 per week. (credit:Vstock via Getty Images)
Implement A Financially-Free Weekday(06 of10)
Open Image ModalMake your own coffee that day, pack your lunch, stay in and watch Netflix, and make your own dinner. Start this challenge by bringing your lunch every day, for example. Turn it up a notch by implementing financial-free weekdays at least three times a week. "Going out only once a week will save you a ton of money," Lester says. (credit:Adam Gault via Getty Images)
Save 10 to 20 Per Cent Of Everyday Dollars(07 of10)
Open Image ModalHave your bank transfer 10 to 20 per cent of your paycheque into a savings account every time it goes in. Over time, it will grow and you won't even miss the amount. If you're worried about spending it, try opening up a separate bank account without any fees or invest in a TSFA. Remember, once you get comfortable, you can move up the percentage. (credit:JGI/Jamie Grill via Getty Images)
Think Property(08 of10)
Open Image ModalLooking into the future, start thinking about investing in property. "Real estate has gone up in the long run and there isn't a single better investment for retirement than a home that is paid for," Lester says. Although this may seem out of reach for most millennials, start saving early by putting away a certain amount of money each month for a condo or house, live with roommates to decrease your own rent costs, and keep an eye out for new buildings or units in your area. (credit:Dana Tezarr via Getty Images)
Learn How To Invest(09 of10)
Open Image Modal"I know it seems boring, but once you have a portfolio of investments pumping money into your account, you'll see it as fun too," Lester says. Join an investing group, watch the news for the latest numbers or pick up some investing books from the library. (credit:carlp778 via Getty Images)
Know Your Net Worth(10 of10)
Open Image ModalTake a minute to actually figure out where your money is, including how much money you have in each account, money you owe and money you have invested, if any. "You don't have to cut out expensive coffees, shop with coupons, and live like a hermit to be a money champ. Spend less than you make and save 10 to 20 per cent for your future," Lester says. If your net worth is increasing year after year, you're on the right track. (credit:sjenner13 via Getty Images)