Most parents who think about helping a child buy a home have something in common. When they bought their first home, it was significantly easier to make the down payment than it is now. Today, real estate prices have escalated, mortgage regulations are stricter and the cost of living is higher. So a parent might feel it’s reasonable to step in and help a child become a homeowner.


If a child needs help to make the down payment, the parents’ assistance can enable the child to move into a home of their own perhaps several years earlier than without the help. The parents’ financial assistance can also make the difference between the child owning the home they set their heart on and having to compromise. But it’s not only the child who may benefit. Parents are able to witness the support they’re providing – which doesn’t happen when assets are only left in a will. Also, the child would typically receive funds through a will when they’re already established, versus an advance on their inheritance now that can make a significant difference to a child who’s starting out.


As promising as helping out sounds, it’s not for every parent. Some parents worry that it sets an undesirable precedent – that the child will expect more financial help down the road. Other parents worry that the child will acquire a sense of entitlement and not develop financial independence. Another concern is that the young couple is only being set up to face more financial hurdles they’re not ready to meet, whether from starting a family, covering expensive home repairs or dealing with unexpected hardships such as job loss. Also, if you have two or more children and help one buy a house, you’ll need to avoid conflict among siblings by adjusting your will accordingly or giving advances on the other children’s inheritance.


The decision to open the Bank of Mom and Dad is part personal, part financial – and we’re here to help you with the financial side. First, we can determine if the amount you’re considering, whether for one or more children, will have any impact on meeting your retirement savings goal. We can help you decide whether your assistance comes in the form of a cash gift, signing as guarantor on the child’s mortgage or another method. Note that with today’s restrictions, many mortgage lenders will accept a gift from parents toward their child’s down payment, but will not accept funds given as a loan. Finally, if you decide to gift cash, we’ll advise on how you access the funds from savings and investment accounts in the most tax-efficient manner

This material was prepared for and published on behalf of your financial advisor and is intended only for clients resident in the jurisdiction(s) where their representative is registered. This material is provided solely for informational and educational purposes and is not to be construed as an offer or solicitation for the sale or purchase of any securities or as providing individual investment, tax or legal advice. Consult your professional advisor(s) prior to acting on the basis of this material. Insurance products are available through advisors registered with applicable insurance regulators. Individual equities are available only through representatives of Assante Capital Management Ltd. In considering any particular investment, please remember that past performance is no guarantee of future performance. Although this material has been compiled from sources believed to be reliable, we cannot guarantee its accuracy or completeness. All opinions expressed and data provided herein are subject to change without notice. Neither CI Assante Wealth Management or its dealer subsidiaries Assante Capital Management Ltd. and Assante Financial Management Ltd., nor their affiliates or their respective officers, directors, employees or advisors are responsible in any way for any damages or losses of any kind whatsoever in respect of the use of this material. CI Assante Wealth Management is a registered business name of Assante Wealth Management (Canada) Ltd. Assante Capital Management Ltd. is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada. Assante Financial Management Ltd. is a member of the Mutual Fund Dealers Association of Canada and the MFDA Investor Protection Corporation (excluding Quebec). © 2022 CI Assante Wealth Management. All rights reserved.