As more retirees prioritize meaningful connections and real-time support for their families, the question of gifting money to family in retirement is gaining momentum. Is it better to help your kids and grandkids now, while you’re alive and can witness the impact or wait and pass it down as an inheritance? We spoke to Ryan Thornton, a retirement advisor with over 30 years of experience, to explore the financial, emotional, and tax-smart strategies behind this increasingly common dilemma.
The Case for Gifting While You're Alive
“Imagine your parents gave you a financial gift when you were just starting out, would it have made a difference?” Thornton asks. For many families, the answer is yes.
Giving while you’re still here doesn’t just help your loved ones, it allows you to share in their joy and success. Thornton encourages retirees to think about ways they can experience that joy firsthand, such as helping with a home down payment or funding a family vacation. “Giving away money isn’t the only option,” he adds. “Why not pay or help pay for a fun trip with your entire family? It’s something you can all experience and enjoy together.”
But First: Secure Your Own Future
Before you start writing checks, Thornton stresses one core principle: Take care of yourself first.
He compares it to the familiar airline safety rule. “You know on those pre-flight videos how they explain parents should put on their own oxygen mask before helping their children? The same concept applies here.”
Financial generosity is admirable, but only after your retirement plan is solid. That means ensuring you’ve:
Covered your long-term care
Accounted for rising costs
Protected your independence
Gifting money should be a thoughtful, planned extension of an already stable retirement, not a strain.
How to Gift Without a Tax Headache
One of the biggest misconceptions about gifting is that it always comes with tax consequences. Here’s what Thornton says is most important to know:
In 2025, you can give up to $19,000 per person, per year without triggering gift taxes or eating into your lifetime exemption. And couples can gift $38,000 jointly per recipient.
Even if you exceed that amount, you’re not taxed, you simply file a gift tax return to track your lifetime use of the $13.99 million exemption. “It sounds like monopoly money to most people,” Thornton jokes. “But it’s important to understand these limits so you don’t hold back unnecessarily.”
There are also other smart strategies, like:
Qualified Charitable Distributions (QCDs) from your IRA
529 contributions for grandchildren’s education
Paying tuition or medical expenses directly—which don’t count toward annual limits at all
For full details, check out IRS Gift Tax FAQs.
Generosity with Boundaries
Whether you’re planning to give $5,000 or $50,000, Thornton says clarity is key. Start by deciding if generosity is even part of your goals. Not everyone feels compelled to give and that’s okay. But if you do want to help your family financially, you need a clear strategy and open communication.
That means:
Explaining your intentions
Being transparent about what you can and cannot offer
Regularly revisiting your plan as your financial picture evolves
A Legacy You Can Experience
For many retirees, the idea of helping their children and grandchildren while they’re still here brings a sense of fulfillment that inheritance alone cannot offer. “If you were already planning to leave funds behind anyway,” Thornton notes, “why not consider doing it sooner when it can make a bigger impact, and you can be part of the experience?” From easing the burden of student loans to creating unforgettable travel memories, gifting now offers the chance to build a living legacy.
About the expert
Russ Thornton is a retirement advisor with over 30 years of experience in the financial industry. His true passion lies in helping women navigate the transition into retirement with clarity, confidence, and peace of mind. Russ believes retirement isn’t just about the numbers, it’s about living life on your own terms and leaving a meaningful legacy. Learn more about Russ and his work at WealthCare for Women.
