Most parents want to give their children a better start than they had.

That might mean helping with university, a wedding, a first car, a home deposit or simply being there financially when life becomes difficult.

But there is an uncomfortable question many parents avoid:

"How much can we afford to give without putting our own retirement at risk?"

Generosity is a wonderful goal. It just needs to be planned. If executed poorly, being too generous now can result in becoming a financial burden to your children decades later.

Your retirement has to come first

This can feel selfish, but it is actually the opposite. Your children may have decades of working life ahead of them. You may have a limited number of earning years left.

If helping your children leaves you underfunded in retirement, the financial burden may eventually return to the family anyway. Securing your own independence is the greatest foundational gift you can provide.

Start by knowing your own number

Before deciding how much you can give away, understand what your own retirement is likely to require.

What lifestyle do you want? When do you want to retire? Will the home be paid off? How much income will you need? What margin do you want for health, travel and unexpected costs?

Until those questions are reasonably clear, it is difficult to know what is truly surplus capital versus structural capital.

Decide what type of help you want to provide

There is a big difference between helping with a $10,000 education expense and contributing hundreds of thousands towards a property in a high-cost capital city.

Be specific about what you are trying to achieve. Is the goal to give the child a small head start, help them avoid a particular debt, or materially change their housing position?

Gift or loan?

Families sometimes describe money as a loan when everybody really expects it to be a gift - or treat it as a gift when they may need the money back later.

Clarity matters. Larger amounts can also create legal, estate planning and relationship considerations, so proper advice may be important. Setting up formal arrangements avoids resentment downstream and properly structures your estate if an emergency arises.

Be careful about becoming the bank of mum and dad by default

Helping once is different from becoming the ongoing solution to every financial problem.

If support becomes open-ended, it can be difficult to plan your own cash flow and retirement. Setting boundaries is not a lack of generosity. It is responsible planning.

A good outcome supports both generations

The aim is not to choose between your children and your retirement. The aim is to find a level of support that strengthens the next generation without weakening your own financial independence.

The best gift you can give your family may be helping them while also remaining financially secure yourself. With careful analysis and candid conversations, both objectives can usually be accommodated.