housing season IS Back in full swing
Helping (Grand)Kids Buy a Home: Five Ways to Structure Support
In 2025, 41 percent of first-time homebuyers received down-payment gifts averaging $74,570, highlighting the significant role family members play in helping the next generation enter the housing market.1 For many high-net-worth families, there is value in seeing wealth put to use during one’s lifetime. However, support can take many forms, each carrying different tax and family law implications. When there are multiple children, it may also be important to consider how financial assistance to one child may affect fairness among siblings, and revisit an estate plan accordingly.
Here are five ways to structure support and related considerations:
Provide a Gift — When providing a financial gift to a child, you relinquish ownership and control of those funds. As a result, there’s a risk that funds won’t be used for a home purchase, or could become subject to division in the event of a future relationship breakdown, depending on how the purchase is structured. While Canada does not impose a gift tax (unlike the U.S.), liquidating investments to fund a gift may trigger taxable capital gains or other taxable income.
Leverage Tax-Advantaged Accounts — Rather than providing a large lump sum gift, consider planning ahead through smaller contributions over time to help a child maximize tax-advantaged accounts. Both the First Home Savings Account (FHSA) and Registered Retirement Savings Plan (RRSP) provide tax advantages through tax-deductible contributions. The FHSA is particularly compelling because investment growth is tax-free and qualifying withdrawals to purchase a first home are also tax-free. Under the RRSP Home Buyers’ Plan (HBP), withdrawals of up to $60,000 can be made tax-free (subject to repayment) for the purchase of a first home. Beyond the significant tax advantages, these accounts can help reinforce the value of saving and longer-term investing.
Loan Funds — Instead of an outright gift, funds may be advanced as a loan, with or without interest. A formal loan agreement should clearly set out repayment terms to avoid future misunderstandings. Proper documentation may help preserve the characterization of funds as a loan in the event of a relationship breakdown.* If desired, the loan can later be forgiven.
Co-Sign the Mortgage — This may help children qualify for a larger mortgage, secure more favourable borrowing terms or enter the market when they might not otherwise qualify. However, a co-signer is legally responsible for the debt if the borrower defaults. The arrangement can also affect the co-signer’s credit rating and borrowing capacity. In addition, trust reporting requirements may apply where the co-signer is required to be registered on title.
Co-Own a Property — While co-owning a property may help protect your interest in the event of a relationship breakdown, if you already own another property, the share of any future appreciation may be subject to capital gains tax upon sale or disposition.
Supporting a child’s home purchase is a significant and generous act. Since each form of support carries different financial, tax and family law implications, thoughtful planning can help ensure the outcome aligns with your intentions. For a deeper discussion, please call.
*The effectiveness of the loan in protecting against division in the event of a relationship breakdown may vary by jurisdiction and a family law lawyer should be consulted. This article is not intended to be a definitive analysis of family law.
1. https://www.cmhc-schl.gc.ca/professionals/housing-markets-data-and-research/housing-research/surveys/mortgage-consumer-surveys/2025-mortgage-consumer-survey
SUMMER JOB? build rrsp contribution room & a retirement nest egg
A Case Study: Why Help a (Grand)Child File a Tax Return?
As the saying goes, “Give the man a fish, and you feed him for a day; teach the man to fish, and you feed him for a lifetime.” The same principle applies to financial literacy. Small lessons introduced early, including something as simple as filing a tax return, can create habits and opportunities that benefit young people for years to come.
Is there a teen in your family, perhaps a (grand)child, niece or nephew, working during the summer or part-time after school? Helping them file a tax return can be a simple but powerful way to begin building long-term wealth while introducing financial habits early in life.
Many teens choose not to file a tax return if their income falls below the federal basic personal amount, which is $16,452 for 2026. What is often overlooked, however, is that even modest earnings can generate valuable Registered Retirement Savings Plan (RRSP) contribution room.
A Case Study: Building a Retirement Nest Egg From Age 14
Here’s a simple case study: At age 14, Sam begins working part-time as a lifeguard, earning $5,000 each summer. Her aunt helps her file a tax return, allowing her to accumulate RRSP contribution room at a rate of 18 percent of earned income, or $900 annually. Even without making RRSP contributions immediately, unused contribution room carries forward indefinitely. By age 22, after graduating from university, Sam has accumulated $8,100 of available RRSP room.
When she begins full-time employment and faces a 30 percent marginal tax rate,* she contributes the full $8,100 to her RRSP, saving approximately $2,430 in taxes ($8,100 x 30%). More importantly, if investing at an average annual return of 6 percent, that single contribution could grow to nearly $75,000 by age 60 — not a bad head start for someone just beginning their career!
And the lessons extend well beyond building a retirement nest egg:
Building Lifelong Financial Habits — Supporting teens in filing taxes early can help instill financial literacy and disciplined money management habits that can carry into adulthood, when tax returns will become a necessary part of managing personal income.
Tax-Deferred Growth and Future Tax Savings Potential — Unused RRSP room accumulated in early years can later be used to reduce taxable income, potentially increasing tax savings by claiming deductions when income and tax rates are higher in adulthood.
Future Flexibility Through RRSP Programs — RRSP savings can later be accessed as an interest-free loan, including up to $60,000 under the Home Buyers’ Plan for an eligible first-home purchase, or up to $20,000 through the Lifelong Learning Plan for eligible education or training. With rising housing and education costs, every bit helps.
Encouraging a Long-Term Saving Mindset — Early exposure to saving and investing can help young earners develop consistency and discipline, reinforcing the value of long-term compounding even through small contributions.
*Illustrative. Tax rates will vary depending on income and the province/territory of residence.
Retirement planning considerations
Planning Ahead: Giving Forethought to “Rightsizing” Your Home?
This may sound familiar: your first home started out small, but as your family grew, you needed more bedrooms and a larger backyard. Now the children have left the home, and those bedrooms sit empty — but over the years, rising housing prices may have helped you build significant equity in your home. Perhaps you’re asking: Is there an opportunity to “rightsize”?
Downsizing can provide financial advantages by unlocking home equity and reshaping both lifestyle and financial flexibility. A smaller home typically reduces maintenance, utilities and property tax bills, while freeing capital for other priorities. Accessing home equity may help strengthen retirement cash flow, support family members or fund new goals.
However, fewer people are choosing to downsize. Many prefer to remain in their homes as long as possible. A recent survey found that among those 65 and older, just 16 percent plan to downsize in the next decade, while 57 percent wish to remain in their current home.1
This shift reflects broader changes in housing economics and retirement planning. In the past, homeowners more commonly viewed real estate as a retirement resource. Today, that assumption is less prevalent. Longer life expectancy, improved health in later years and higher overall wealth have contributed to a greater ability to remain in place. At the same time, rising real estate costs, including seniors’ housing, have reduced the net financial benefit of downsizing, limiting the equity released.
Several other factors may also influence the decision:
Emotional impact. Downsizing is not purely financial. Long-time homes are often tied to memories, routine and identity — factors that can delay decisions long after the financial case becomes clear.
The cost of moving. Selling expenses, including legal fees and commissions, can account for a meaningful portion of proceeds. Preparing a home for sale (including staging or repairs) adds further expense, as do moving costs and updates needed to settle into a new property. The process itself can create administrative complexity and require a substantial time commitment.
Market uncertainty. Limited inventory has made it difficult for some homeowners to find a suitable replacement property, while market price fluctuations can affect what a sale will ultimately yield. In many markets, prices have shifted from their highs, making the sale of an existing home less attractive.
Trade-offs in housing flexibility. Moving to a rental or community setting may reduce maintenance responsibilities but can introduce uncertainty around lease terms, fees and future cost increases. Ownership typically provides greater control and predictability.
It’s Not Just a Financial Decision
Yet the decision to downsize isn’t simply a financial one. As life circumstances evolve, including changes in energy, health and mobility, the question often shifts from whether downsizing is financially optimal to whether a current home still fits day-to-day life.
Those who successfully transition tend to act proactively, motivated by what their next home offers, whether it’s simplicity, convenience or a better lifestyle fit. A recent Globe and Mail article suggested that the best time to plan a downsize is “when you’re still excited about what comes next.”2 The argument is straightforward: it’s better to decide on your own terms, before health issues or practical limitations force the issue. Waiting too long can mean the choice is driven by necessity rather than preference, often under pressure from family members or advisors.
Start Early
As with any major financial decision, planning is important. Take the time to explore your options before circumstances force the decision. If you’re considering relocating to a new community, city or province, spend time there during different seasons to understand what day-to-day life might look like. If you’re thinking of moving abroad, understand the tax, healthcare and residency implications. For condo living, review bylaws and restrictions carefully; details like pet policies or renovation rules may significantly affect your experience.
A thoughtful approach allows you to weigh both the financial and lifestyle implications before making a decision. While “rightsizing” your home may mean it becomes smaller, the opportunities ahead can expand in meaningful ways.
1. https://www.bnnbloomberg.ca/business/real-estate/2026/05/03/not-the-right-time-retirees-delay-downsizing-plans-as-housing-market-slumps/