To let my DCs spend their university money on something else

(55 Posts)
flashheartscanoe Tue 07-Jun-16 09:57:30

A while ago I inherited some money from my grandmother. At the time we decided to invest it for the kids so we could contribute towards their university costs when the time came. We don't have a big income so it would be a struggle otherwise. Its not enough to pay for it all and they will need loans and jobs as well. Roll on a few years and the eldest is talking about uni and potentially doing a long and expensive course. It's time to talk to them about it - I don't want her to feel she didnt have the same choices as the others so we need to be clear from the start. So here's the question...if you part fund a long course for the eldest would you let the others have the same amount to potentially do something else with?

pippistrelle Tue 07-Jun-16 10:06:50

But you don't know what courses (if any) the others will want to do yet. Or if your eldest will complete the course she's thinking of. So, I don't think you have enough information on which to make those sorts of decisions yet. You can let them know that you have some money which you intend to use for education but don't let them know you'd be prepared to use it for something else if they don't go down that route. A 17 year old given a choice of a car now (for example) or a great education can't be relied upon to make the right choice. See what happens over the next few years, and the look at how to even things up then, if necessary.

mrsbee2be Tue 07-Jun-16 10:08:42

Depends how much you have, but I know if I had a large sum of money invested for my kids I'm probably but thinking more on the lines of an house deposit instead..... As someone who has spent many many years not getting very far saving for one myself, Currently mid 30's with massive envy of any one with a mortgage!

Kleinzeit Tue 07-Jun-16 10:09:13

I would divide the money for the children up equally. You don’t have to give it to all of them at the same time though. You could say that you will be keeping it for them til they’re 21 or 25 and when each of them reaches that age you will give their share to them to spend as they like, but if they need their share of the money earlier for education (like your eldest) or house deposit or similar important (and parent-approved smile) spending then you will give it to them for that. Which might mean you can't spend as much as you'd like on DD's education but otherwise it might be hard to make things fair and it could cause bad feeling.

Buckinbronco Tue 07-Jun-16 10:11:26

No I think I'd just pay for their uni- If they don't want to go that's fine but they don't need the money

flashheartscanoe Tue 07-Jun-16 10:19:29

The other day she half jokingly said she might prefer to buy a small piece of land instead and start a business (she's into horses). I would hate her to think she didn't have that choice if that's what the youngest decides to do. (This is just an example). I don't really agree it should just be for uni. I don't think that's fair on the less academic sibling.
Re. Houses I think we will hold some back for a deposit for each of them but uni is a factor as well. (It will be around £50,000 each)

enterYourPassword Tue 07-Jun-16 10:32:32

I'm confused. Are you in the UK? Holding back 50k after paying for uni is a nice amount of money so what kind of expensive uni course would exhaust this 50k each?

If it were me, I would divide the money between children and give them whatever was left at whatever stage they wanted it (for an approved purpose). The one who has £15k of uni gets £35k. The one who wants to buy a house without uni gets the full amount.

My parents paid for my accommodation and other costs whilst I did a BSc, MSc and MA (all in a row). My brothers (one Bachelors and one Bachelors and Masters) were gifted a certain amount so we'd each had the same amount spend on each other. The one with only 3 years at uni got more.

Buckinbronco Tue 07-Jun-16 10:33:56

Medical school I imagine.

MrsMushrooms Tue 07-Jun-16 10:35:33

How much do you think uni is that £50,000 each won't cover it!? :O obviously don't even bother about fees because they're not 'real' debt in any sense (fees are the maximum amount you can be expected to contribute through earnings once you've graduated and are earning enough). So, that means £50,000 just for 3 years of rent, food, books, etc. Even more if they take the student loans (which I would always suggest because even if you just stick the money in an ISA, you'll make more money off it than you have to pay back with interest if you ever do pay it back)

I'd say that each of them can have access to their money aged 18 to invest as they like - either for uni or to start a business, or whatever. But that's just me.

Buckinbronco Tue 07-Jun-16 10:35:51

It's just because the less academic sibling wouldn't need money would they? They've chosen to do something else, it doesn't cost anything.

My concern with saying "uni or a house deposit" (for example) would be it would discourage them from uni and the one who doesn't go to uni will be working anyway so will have many years of earning over their degree educated siblings

Fannyupcrutch Tue 07-Jun-16 10:50:14

As others have said, dont , DO NOT use the money to pay for uni fees. Let your kids take them out as a loan. Especially daughters, realistically they are very unlikely to ever pay back the full amount of student loan anyway as they often have career breaks for raising a family etc. Think of student loan repayments as a graduate tax that you pay back in dribs and drabs after you earn over £21k a year. its wiped after 30 years too.

I think if one of your kids doesn't want to go to uni then it's fine to offer to help them out in maybe starting a business or even better, a deposit for a house. Just make sure that the money is protected if they get a mortgage with their partner. Have it put into a contract that upon sale/seperation the £££ that your child paid would be returned.

Micah Tue 07-Jun-16 10:53:00

eh?

Don't see the dilemma? Give them 50k each when they reach 21. They can pay off uni debts, go travelling, buy a house.

What exactly are you trying to do? Pay for uni or not?

ExtraHotLatteToGo Tue 07-Jun-16 10:53:02

If it were me, it keep quiet about it. Let them make their own life choices independent of this money. Tell them if they go to in you might be able to help them a bit, but they'll have to work etc.

If we were unable to help a bit (and given their funding is based on parents income) I'd use some of the money, but I'd try not to use much. Let them get student loans, they only have to pay them if they get decent jobs afterwards and let them live like students. It's all part of the experience.

Save the money until they have got part of a deposit for a house then tell them you can help the out a bit.

The housing ladder is hard to get onto because of the deposit, not because people can't afford the mortgage. I think this is the best way to help them myself.

But don't tell them - let them make choices for themselves first. IMO.

Hastalapasta Tue 07-Jun-16 10:55:17

DD wants to be a vet by any chance? It is expensive, and a long course.
I would probably not tell them about the funds, and hand it over after the course has finished and she is working. That way she can pay back the debt or put a deposit on a house, or farm, whatever she chooses.

Babyroobs Tue 07-Jun-16 10:55:27

We will soon be in a position of inheriting a significant sum of money which we will hopefully invest to help our 4 kids in the future. We have also saved a small amount over the years in Child trust funds/ Junior ISA's. I won't be giving them large amounts to help them through Uni as they can access loans and get part time jobs. I would rather use the money to help with a house deposit when the time comes for them to want to buy.

ExtraHotLatteToGo Tue 07-Jun-16 10:56:45

Don't give them £50k each when they're 21.

Partly because it's very young to have that much money, it'll seem like an endless pit and very few 21 year olds will spend it wisely.

Secondly because it changes their path in life and not always for the best. Let them make their way on their own two feet then when you can see they are serious and determined about something you can help them out if you feel it's right.

Hastalapasta Tue 07-Jun-16 10:56:52

Sorry, cross posted with Latte

SpringerS Tue 07-Jun-16 10:58:51

I'd keep the money, an equal amount for each child and use it either to help out with buying a house, starting a business (as long as it had a realistic chance of succeeding) or even life changing medical treatment, like IVF, in the future.

charliethebear Tue 07-Jun-16 11:03:43

My grandparent had some inheritance and gave me my brother and cousin the same amount of money, supposed to be for uni but my course is 5 years, brothers is 3 and cousin didn't go.

I dont mind that I have less to spend on house/car etc as i have chosen to do a long course. I cant imagine 50k is too little for uni though? Dont pay their fees.

I would just give them the money at say 18 to do what they will, maybe give 20k at 18 and 30k at say 25?

TeenAndTween Tue 07-Jun-16 11:04:04

I would mentally divide it between the children.

I would not use it to pay student fees up front because it is cheaper for them to get a loan and repay it very slowly once they earn enough.

But I would use it to subsidise living costs at university so they can focus on their studies not on working all hours in paid work.

Someone with a degree should in theory end up with a better paid job, so should be more able to get a mortgage or whatever in the future. Thus someone who is not academic enough or choose not to go to university might be in more need of a leg up the housing ladder in future.

I would listen to what your eldest wants to do, and offer some funds to support that. Don't however say 'we have 10k to burn, how do you want to spend it'.

VioletBam Tue 07-Jun-16 11:07:19

Its not enough to pay for it all and they will need loans and jobs as well.

Yet you're keeping back 50 grand for house deposits for them? confused

I don't understand.

netflixandicecream Tue 07-Jun-16 11:13:45

i would devide equally between them and give it to them when they turn 21.

MurphysChild Tue 07-Jun-16 11:15:12

I don't really understand either. The way I read it you have 50k inheritance which you have been holding with a view to putting it towards your children's education. This may get eaten up by the oldest child's course.

I personally would forget about the reference to university full stop. I would split the funds by however many children you have and at 21 inform them of said inheritance and they can either a) pay it towards uni debt incurred b) spend it towards property

Done.

clarrrp Tue 07-Jun-16 11:15:26

Personally I would just split it and lock it down in trust - there's no way in gods green earth I would just hand over 50k to an 18 year old.

VioletBam Tue 07-Jun-16 11:21:00

Murphy no...she said the following

Re. Houses I think we will hold some back for a deposit for each of them but uni is a factor as well. (It will be around £50,000 each)

Join the discussion

Join the discussion

Registering is free, easy, and means you can join in the discussion, get discounts, win prizes and lots more.

Register now