Intergenerational dependency

The hidden $507bn cost of support provided by Australian children, parents and grandparents

Monday, 1 May 2017

New research reveals the ‘sandwich generation’ of older working Australians being squeezed financially by children and parents


  • Rest research reveals older working Australians, those aged 50+ and still working, are most likely to provide assistance with everyday expenses, education and home deposits when giving to their children
  • Nearly half of older working Australians expect to retire with debt
  • One in three (35%) retirees are living with what they describe as a ‘frugal’ retirement
Research released today by Rest Industry Super, one of Australia’s largest superannuation funds with over 1.9 million members, has highlighted the growing intergenerational dependency of Australian families, revealing older working Australians to be responsible for the majority of financial giving ($196.8bn).

These findings come from The Journey Begins, a whitepaper commissioned by Rest to better understand the attitudes, finances and expectations of pre-retirees (aged 50+) against those who have already retired, and younger Australians still working (aged 35-49). The survey sampled 1048 Australians aged over 35.

According to the research, 72% of intergenerational assistance is provided to adult children aged over 18, most commonly for expenses such as their education or their children’s education ($109.0bn), everyday expenses ($93.1bn) and home deposits ($68.5bn).

The research showed adult children aged 35+ are also providing financial assistance to their parents, with 14% helping to fund medical or health expenses.

Rest’s survey also showed older working Australians had on average, assets of $963,000 inclusive of the family home, which is around 30% more than the $742,000 currently held by the retirees surveyed. However, 46% of older working Australians expect to retire with debt, with one in four retiring with credit card debt (25%), one in five with a mortgage (21%) and one in ten with unpaid bills (12%).

According to Rest CEO Damian Hill, the high prevalence of intergenerational dependency, and the level of debt with which a near majority of older working Australians are retiring, is cause for reflection and rethinking.

“As the majority of assets for older working Australians are locked up in the family home, carrying mortgage debt into retirement can be a cause of financial stress for retirees. While any debt they have is usually offset by savings in superannuation and other investments, it’s a good idea for people in this age bracket to try as much as possible to pay down this debt before retiring.

“While the financial support being provided is often for critical items such as education and housing, and the majority (79%) of those who had the means to provide financial assistance felt good about helping out, it needs to be balanced with a focus on saving for a comfortable retirement.

“While our research shows older working Australians are expecting a relatively high standard of living in retirement, this expectation could be derailed by the growing debt burden, particularly when funds are being diverted to adult children,” said Mr Hill.

Rest’s white paper calls for workers to become more attuned with the financial cost of retirement, and the extent of longevity, and hopes to better align the expectations of pre-retirees and young Australians still working with the reality of those already retired.

“It’s clear that many Australians aren’t living the retirement that they wanted, but with careful budgeting and spending, it’s certainly possible to achieve this,” continued Mr Hill.

“Seeking professional financial advice can help Australians better prepare for the retirement they’ve earned. Rest has invested significantly in assisting our members gain access to affordable personalised advice over the phone or via our website with our dedicated in-house Advice Specialists,” concluded Mr Hill.

View The Journey Begins whitepaper here.

Shane Allison
Sefiani Communications
t: (02) 8920 0700 m: 0420 219 963

Pauline Hayes
Corporate Communications Manager, Rest
t: (02) 9086 6348 m: 0458 815 252

About Rest Industry Super
Rest is one of Australia’s largest super funds by membership with over $42 billion in funds under management as at 31 December 2016 and around 1.9 million members. SuperRatings awarded
Rest Pension of the Year 2015, the second year in a row Rest has won this award. Rest also received Money magazine’s 2015 and 2014 Best of the Best award for Best Super Fund Manager and
Best Pension Fund Manager. Heron has also awarded Rest a 5 quality star rating for 2016/2017*.

*Ratings or awards are only one factor to consider before deciding. More details – go online. SuperRatings Pty Limited does not issue, sell, guarantee or underwrite this product. Go to for details of its ratings criteria.

As we have not taken into account your circumstances, please consider whether this information meets your needs. Go online for a PDS to consider before deciding. This information is provided by Retail Employees Superannuation Pty Limited, ABN 39 001 987 739 as trustee of Rest (Retail Employees Superannuation Trust ABN 62 653 671 394).