Should you spend your children's inheritance? These fun-loving boomer couples say it's THEIR cash to splash. But a top lawyer warns they could be making a big mistake

• e-mail

There's a new type of 'ski holiday' that's becoming popular among over-50s - and it has nothing to do with hitting the slopes for some fun in the snow.

What your friends are really talking about is their 'SKI' holiday - a handy acronym for 'Spending the Kids' Inheritance' - and it's all the rage among boomers and Generation X.

Parents who spent their lives working hard and raising children now want to have some fun with their money.

Their philosophy is 'life is for living' and they don't want to die sitting on piles of cash that will just be inherited by their kids.

Their fun-loving approach is totally at odds with others from their generation who believe it's their duty to help out their sons and daughters financially - which, during a housing crisis, usually means helping them to buy their first property.

Unlike the 'SKI club' members, their life mantra is, 'I'm only as wealthy as my poorest child'.

Instead of splashing out tens of thousands of dollars a year on holidays and cruises, they are dipping into their retirement chest to free their children from the binds of rent slavery.

And they don't view it as generosity - they see it as a moral obligation.

Andrew Ryan, a 58-year-old retired carpenter, and his wife Michele Ryan, a 65-year-old retired TAFE teacher, estimate they have spent $40,000 on overseas travel during the past year

THE BIG DECISION: DO I OFFER A HELPING HAND? 

Andrew Ryan, a 58-year-old recently retired carpenter, and his wife Michele, a 65-year-old retired TAFE - or Technical and Further Education - teacher, estimate they have spent $40,000 on overseas travel during the past year - spending six months abroad.

This included visits to Greece to see the Acropolis in, Pamplona in Spain and a trip across Thailand. They also have a 51-day cruise in South America planned for later this year, which will cost $16,000 for an inside cabin.

But their globetrotting, as grandparents now, only comes after spending years working six days a week, Monday to Saturday.

The Ryans, from Brisbane but recently visiting the Indonesian island of Lombok, say they have worked hard for their money, and their two daughters, both in their twenties, don't need their help to buy a house.

Andrew rejects the idea Millennials, those aged between 28 and 43, and Gen Z, now aged between 12 and 27, have it tough compared to previous generations due to the cost of living and housing market.

'Every generation has been tough. Every generation has had to adapt. They've had to work hard and hustle to make ends meet,' he says.

'I just don't think we can jump to the conclusion that we all have to suddenly change - that parents should start funding our kids' lifestyles. A home is a lifestyle [choice] and they have to live within their means.'

Michele says she's worked full-time since the age of 17, continuing even after becoming a mother to their two daughters, now aged 28 and 25.

'I have always pretty much worked full-time. When I had my first daughter, I had a year off teaching but I only took six months off with our second daughter,' she says.

Michele worked as a teacher for most of her career, but also balanced that with hospitality and administration work to pay the bills. 

'I've held two jobs along the way as well as raising the family,' she adds.

'It is hard for me to stop, even now, because I've worked so hard, I've worked all my life, it's hard for me to actually get out of that.'

The Ryans, from Brisbane, spoke to me about their lives in retirement from the Indonesian island of Lombok, east of Bali. They say they worked hard for their money, and their two daughters, both aged in their twenties, don't need their help to buy a house 

Michele Ryan says she has worked hard since she was 17, including when she became a mother

Andrew says the sudden death of a work colleague, who was a plumber on home renovation building sites, inspired him to live life to the fullest.

'I worked with a colleague a year back who was six months older than me - similar background,' he explains.

'He was a plumber. He got sick and within six weeks we were at his funeral.

'He sat near me and we talked every day, he had two daughters; he talked about his plans and his future. It didn't leave me, so I thought, "We've got to make changes."' 

While he and his wife are prioritising travel at the moment, Andrew says they would be prepared to sell their house if one of their daughters had a medical emergency she couldn't pay for.

'[We would provide financial support in the case of] a medical emergency for them or our grandchildren or anything like that - something that was out of the blue that couldn't be budgeted for,' he tells me.

'When your kids are born, you'd take a bullet for them, you'd do anything for them. But we don't believe in financially supporting [them] to buy a home, which is a lifestyle choice.'

Andrew Ryan says the sudden death of a work colleague, who was a plumber on home renovation building sites, inspired him to live life to the fullest 

DID THE BOOMERS REALLY HAVE IT EASY? 

Here in Australia - and no doubt in other countries, too - there is pressure building on the over-60s to part with their savings to alleviate the financial pressure on the younger generation, many of whom have been priced out of the housing market.

When the generation born after the war were young adults in the 1970s and 1980s, houses were affordable and they had access to free education.

The situation is very different now, which means those who did well out of real estate have two choices: live it up in their retirement years while they still can or sacrifice some luxuries to help their children buy a home. 

Those putting themselves first as part of the 'SKI' movement insist their children are happy for them to spend their cash as they please. They also refute the idea they 'had it easy', citing the punishing 18 per cent interest rates they paid 35 years ago.

Baby boomers who worked hard all their lives are being pressured to provide for their children who are priced out of the housing market. Leanne and Leon Ryland, a married couple from Victoria with two adult sons, boasted about how they had spent $170,000 on luxury holidays

While there's no denying many over-60s also faced challenging financial times in the 1980s, what are the facts when it comes to whose had it tougher?

In 1984, Sydney's median house price of $85,900 was just 4.5 times the average full-time salary of $18,990.

Four decades later, a typical Sydney house costs $1.5million - or 14.7 times the average wage of $100,017.

Their son Alex in July told SBS Insight program he supported them enjoying their retirement

Then there's the hefty 20 per cent mortgage deposit of $294,608 which means only a high-income earner earning more than $226,000 is able to even get a loan for the typical Sydney house, usually a three-bedroom home with a backyard.

This borrower would still be in mortgage stress despite being among the top 2.3 per cent of income earners who has scrimped and saved for years to get onto the property ladder.

The banks are only able to lend someone 5.2 times what they earn, which puts the typical Sydney house beyond the reach of a dual-income couple with no kids, even if they are both on low six-figure salaries.

Those under 40 are unlikely to ever afford a house on their own unless they become a particularly high-income earner or have help from their parents - known as the Bank of Mum and Dad.

There are two major advantages boomers had over their children - cheaper houses and free university. As a result, retired high-profile barrister Julian Burnside (pictured) is an advocate for helping out the kids and not spending their inheritance on holidays

The numbers do not lie: Boomers did have it easier buying a house. And that wasn't the only advantage they had over the younger generation.

They were also able to get free university education from 1974 to 1989, unlike later generations who are saddled with higher education debts.

It is these two advantages - cheaper houses and free further education - that makes high-profile former barrister Julian Burnside an advocate for offering a helping hand and not spending children's inheritances.

Now retired, Mr Burnside, 75, specialised in the field of commercial law. He argues his generation of parents have a moral obligation to help their children buy a home if they are able to.

'They can avoid spending their inheritance for a start,' he tells me.

The former Kings Counsel lawyer and one-time Greens candidate says it's 'outrageous' that boomers are spending excessively on overseas holidays and leaving little left over for their adult children.

'If a boomer has enough spare cash that they can choose whether or not to help their kids buy a home, then they should contribute,' Mr Burnside says.

'It's a question of current obligations - if they can afford to now, they should. It's very selfish not to.'

Mr Burnside says boomers who spend their kids' inheritance need to put aside the bad memories of interest rates in the 1980s and actually remember how comparatively affordable houses were for ordinary Australians back then.

THE BOOMERS WHO ARE HELPING OUT 

The transfer of wealth expected to take place over the next two decades - as baby boomers pass away and their children inherit their money and assets - is going to be massive.

The Productivity Commission estimates $3.5trillion in wealth will change hands. And that money won't be spread thin either: boomers had fewer children than earlier generations, thanks to the contraceptive pill, which was introduced to Australia in 1961, and changing social attitudes. Typically, an inheritance today is divided between just two siblings.

However, it's wrong to assume the younger generations are simply 'waiting for the inheritance'. In many cases, they are already benefitting.

Finance author Joel Gibson, the campaign director at consumer advice centre One Big Switch, says many boomers are extraordinarily generous with their children. He cites the statistic that 40 per cent of young home buyers now get help from their parents compared with just 15 per cent in the early 1980s.

'I don't doubt that the kids of "SKI Movement" boomers are tearing their hair out wishing they had more help getting into the property market. And fair enough,' Mr Gibson tells me.

'But the data doesn't lie - for every boomer who is living it up travelling six months of the year, there are plenty more who are minding their grandchildren and helping their kids with deposits.

'Most boomers are trying to find that elusive balance between enjoying retirement and helping out their families. There's no perfect recipe.'

Money expert and finance author Joel Gibson says many boomers are extraordinarily generous with their children. He cities the statistic that 40 per cent of young home buyers now get help from their parents compared with just 15 per cent in the early 1980s

...AND THE BOOMERS LIVING IT UP 

For many baby boomers, there is a sense of urgency when it comes to post-retirement travel because your health and quality of life could change in an instant. 

Michele Ryan says it's 'extremely important' to her and husband Andrew to travel the world while 'we are still mentally and physically able'.

'As you get older, those faculties decrease - now is the time, which is why we're doing it,' she says, adding that the couple only just returned from climbing 400 stairs and taking 10,000 steps to look at waterfalls in Lombok.

'We can do that now but say in 10 years' time or 15 years' time, we wouldn't be able to do that. Even yesterday, we had an absolute ball, experiencing different things because we were physically capable.'

Andrew says that while he and Michele spend a lot of money on travel, they always look for bargains: 'When we say we're "spending our kids' inheritance", we're not out there just wasting money.

'We try to be frugal. We look for deals and try and do things on the lowest possible budget as we can.

'We don't stay at backpackers [hostels], we do like our privacy, but we do look for Airbnbs, small places, as long as they're clean and tidy and close to amenities.'

Leanne and Leon Ryland, a married couple from Victoria with two adult sons, boasted of spending $170,000 on luxury holidays and cruises in just four years to see the 'wonders of the world' including Machu Picchu in Peru, and trips to India, Sri Lanka and the Maldives.

'We're not going to be able to spend all this money so let's do it because in another 10 years we won't be climbing the Great Wall of China,' Ms Ryland told SBS Insight in July.

Surprisingly, their son Alex said he supported them enjoying their retirement.

'It's their money,' he said on the program. 'They've worked hard their entire life and invested well in order to get that money, so I think they should be able to do whatever they like with it.'

Mandy and Trevor Watson are proud 'SKI clubbers'. Mandy, a cancer survivor, says that after running a business, they are spending their cash on travel, including dog sledding in Norway

The Rylands run a private Facebook group titled 'SKIclub' where they share travel tips with other jet-setting, cashed-up retirees.

Mandy Watson and her husband Trevor, who are also members of a social media group for boomers, appeared on Ten's The Project in July to brag about holidaying in Venice in a hotel overlooking the Piazza San Marco.

Read More

EXCLUSIVE

Top Aussie CEO exposes the huge problem with Australia

'I am in St Mark's Square in Venice and my hotel room looks straight out at the Piazza - it's incredible,' she said.

Ms Watson, a cancer survivor, said that after running a business, they were now mainly spending their money on travel, including dog sledding in Norway near the North Pole.

'It's mainly on travel these days - we're not really into buying stuff anymore,' she said. 

'We're really into experiences.'

Ms Watson added she had no guilt about spending her kids' inheritance.

'No. That's our situation. Our kids are behind us,' she told The Project.

'We've done the long haul, run a business and built houses and lived in garages while we've built houses and they've done it with us.

'We retired last year - we've finally got time and money, we've never had them at the same time now we can get out there and just do it with their blessing.'

However, Ms Watson hinted they wouldn't spend all the kids' inheritance.

'They'll be a bit left over for them. As my son said, "As long as the funeral's pre-paid, we're good to go."'