Wanting to help is not the question. The question is what a gift costs you in years of security — because the one outcome nobody wants is running out at 88 and needing the money back from the people you gave it to.
A dollar given today is not a dollar given at your death — it has had years to compound in their hands, or years of use.
Wanting to help isn't the question. What it costs you in years of security is.
There's a strong case for giving while you're alive. Money is far more useful to a 35-year-old buying a first home than to an 88-year-old who no longer needs it, and you get to see it work. That's a genuinely good reason and this calculator isn't trying to talk you out of it.
What it does is put a number on the cost — because giving away $100,000 doesn't remove $100,000 from your future. It also removes everything that money would have earned over the years you'd have held it. Over twenty-five years at 5.5%, that's closer to $380,000 of end-of-life wealth.
Whether that trade is worth making is your call. It's a much easier call to make with the number in front of you.
Yusuf has $1,100,000, spends $68,000 a year with $26,000 of pension income, and wants to help his eldest with a house deposit. He's thinking $100,000, and he wants to keep $250,000 untouchable for care costs and emergencies.
The calculator works out he could give up to about $242,000 before his reserve is at risk before age 95. His $100,000 sits comfortably inside that, so the gift is affordable.
The harder question turns out to be fairness. Over the 27 years to age 95, that $100,000 compounds to roughly $424,000 in the hands of the child who received it. His other two children get an equal share of the estate — so the one he helped ends up substantially ahead. Neither choice is wrong. What causes lasting damage is making it without telling anyone.
Staging the gift is almost always better than one transfer. Giving a fifth each year for five years achieves nearly the same thing while letting you stop if markets or your health turn. An outright lump sum can't be recalled.
It's also worth thinking about protection rather than just amount. Money handed over outright is exposed to your child's divorce, business and creditors. A loan secured against the property, or a formal agreement, often serves everyone better — and being clear about whether it's a gift or a loan, in writing, prevents an enormous amount of trouble later.
Finally, check the rules where you live. Many countries look back several years at gifts when assessing eligibility for care support or means-tested benefits.
General information only — not financial, tax or legal advice. Gifts can have tax consequences, can affect eligibility for means-tested benefits and aged care support, and in many jurisdictions are subject to look-back periods of several years. Money given to a child is also exposed to that child's marriage, business and creditors. Take advice specific to where you live before making a large transfer, and consider whether a loan, a formal agreement or a trust structure fits better than an outright gift.