KIPPERS: The Hidden Cost of Adult Kids Living at Home in Australia

It’s the acronym that makes Aussie parents shudder: KIPPERS, or ‘Kids In Parents’ Pockets Eroding Retirement Savings’. While it sounds lighthearted, the financial consequences for older Australians are serious and growing. As adult children stay in the family home longer—thanks to soaring rents, expensive degrees, and cost-of-living pressures—the bank of mum and dad is feeling the squeeze. In 2025, the KIPPERS phenomenon is more than a dinner-table gripe: it’s a threat to the retirement dreams of thousands of Australian families.

What’s Fueling the KIPPERS Trend?

According to the Australian Bureau of Statistics, more than 1.5 million Australians aged 18–34 are living at home with their parents in 2025, a number up nearly 15% from pre-pandemic figures. This shift isn’t just about convenience or comfort. Economic headwinds are blowing hard for younger Australians:

• Housing affordability: Median house prices in Sydney and Melbourne remain above $1 million, with national rents at record highs.

• Student debt: The average HECS-HELP debt for graduates now exceeds $26,000, as indexation rates rose sharply in 2023–24.

• Underemployment: Entry-level job competition and gig-economy work leave many young adults with patchy incomes.

With these challenges, it’s little wonder so many millennials and Gen Zs are bunking in with mum and dad well into their late 20s and 30s.

The Hidden Toll on Parents’ Retirement Plans

It might start with ‘just covering the phone bill’ or ‘helping out with groceries’, but the costs of supporting adult children at home quickly add up. A 2025 National Seniors Australia survey found:

• 53% of parents with adult children at home regularly subsidise living expenses beyond basic accommodation.

• 1 in 3 report delaying downsizing or retirement due to ongoing family financial commitments.

• Average extra annual household costs exceed $8,500 per adult child.

For parents in their 50s and 60s, these unplanned expenses eat into superannuation contributions, savings, and even force changes to investment strategies. The compounding effect? Less financial freedom, delayed retirement, and greater vulnerability to future cost-of-living shocks.

Smart Moves: Setting Boundaries Without Breaking Relationships

Addressing the KIPPERS problem isn’t about showing your kids the door. It’s about setting healthy boundaries, fostering financial independence, and protecting your own future. Here’s how Australian families are adapting in 2025:

• Formal family agreements: Written agreements outlining rent contributions, household chores, and timelines for moving out are on the rise. Legal templates from bodies like Legal Aid NSW make this process easier and fairer.

• Financial education: Some parents are using adult children’s return home as a chance to teach budgeting, super basics, and investing—skills schools still don’t always cover.

• ‘Board’ payments: Charging below-market rent for adult children helps cover increased bills and signals that home isn’t a free ride. In 2025, the typical board payment is $120–$180 per week, depending on city and amenities.

• Downsizing with boundaries: Parents are increasingly selling the family home and moving to smaller properties—even if it means adult kids must find alternative accommodation. With the federal government’s downsizer super contribution rules (allowing up to $300,000 per person from the sale of a main residence into super for over-55s), this can turbocharge retirement savings.

Looking Ahead: Will KIPPERS Ever Fly the Nest?

As cost-of-living pressures persist and Australia’s property market remains tough for first-home buyers, KIPPERS aren’t likely to disappear anytime soon. But more families are recognising the need for open conversations and structured financial support. The goal? To help adult children achieve independence—without sacrificing the security and comfort parents have worked decades to build.

In 2025, protecting your nest egg is more important than ever. By setting smart boundaries and prioritising your own retirement, you’ll set your whole family up for a stronger future.