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To restrict dd's access to savings?

(32 Posts)
JackieOHHH Mon 22-Jul-13 13:17:04

Dd is 17 in sept, she keeps banging on about when does she get her money ( saved through birthday/Christmas and other stuff). She knows she's getting it so I told her its locked away il she's 21....firstly is that too old?? And there's another, small account that she will get at 18 approx £1000...she seemed happy about that, but aibu to not let her have the rest til she's 21? It'll be around £2/3k depending on what comes in.

If I give it her before she's 21 it'll lose interest but doubt it'd be much...I just know when I was her age I got a bit at 18 then some at 21 and promptly squandered every penny

DontmindifIdo Tue 23-Jul-13 12:48:34

I'm going to go against the grain here - it's not a huge sum we are talking about, let's put this in context, £2k would be enough to pay for one fortnight long haul holiday staying in good hotels for one. It's not enough for a house deposit, or even enough to buy a car. If she's going to uni, it's not enough to cover her first year's fees. If she goes to uni without you being able to pay out for fees/housing/spending money, she's going to be at least ten times that in debt at the end. It'll be a drop in the ocean when she's 21. (don't assume she'll be able to get a job to pay for it all, university towns are full of students wanting work, a lot aren't able to find anything)

However, it could be worth her 'wasting' it at 18 to learn about how easy it is to spend a lot of money. Most people learn this at uni, but then they are in the "well, I'm already 15 grand in debt, what's another £500?" mindset. I know so many people it took until they were in their mid-20s to get out of this way of thinking. Spending £2-3k, having a great time/going to uni with some fabulous clothes, but not having got into debt is better than her getting a credit card at 18 with a £3k limit on it and treating that as free money.

If you want her to save it or use it on some big thing, then give it her in one lump sum, not drips and draps. I also think it's odd that you'll control where money goes that she's given for birthdays and Christmases after she turns 18, people will give them to her, will she really hand them over to you to put in savings or will she just put them in her own bank account?

VivaLeBeaver Tue 23-Jul-13 12:28:33

Dd has a savings account which she doesn't know about. She's got about 10k in it.

I want her to use it for a house deposit, by the time she's 21 it'll probably have about 20k in it.

I'm not planning on telling her about the money until she's finished her education. She wants to go to uni and I don't want her blowing it on beer and shoes while at uni.

Andro Tue 23-Jul-13 12:20:56

We have the issue that our DC will get access to about 30k each at their 18th birthday (from my dad) and I feel that 18 is too young. Sadly, I don't think there's anything I can do...

You find a way to teach financial responsibility NOW. My father taught me about managing money from an early age, a vital lesson given how much money I had access to once I turned 18 (a lot more than 30k!). Use monthly allowances etc and (very importantly) don't relent if they blow all their cash in the first week and have nothing left for the rest of the month - and that includes spending money on trips out etc. The lesson can be harsh to learn and difficult to teach, but it is really important if they're going to have access to significant money at 18.

gnittinggnome Tue 23-Jul-13 09:18:18

Have you actually spoken to her about it? Does she understand that once it's gone, it's gone, and that's that? Maybe make a list of things she could do with it, including a new wardrobe and also helpful things like a car, a deposit for a new flat, travelling, not being a starving student etc. It may be she won't listen, in which case it will be a hard lesson, but she may see the wider context beyond new shoes.

possum18 Tue 23-Jul-13 01:10:37

It's not a question of age, but maturity you cant put an age on these things as everyone matures at different times.

Little and often is a good way to prepare dd for financial responsibility and a good way for you to judge if she is ready
i.e give her a few hundred and see what she does!!

Spend it on booze and clothes = limit access
Spend it on books/ invest in cash isa = mature enough to handle the ca$h!!

ReginaPhilangie Mon 22-Jul-13 18:22:14

I think you should just give her the £1000 and then keep the rest till she's 18. My DSD got a lot of money in compensation (£10k) on her 18th birthday. She had a fantastic year with it, but basically blew it all on clothes and booze. She did get 2 holidays out of it, but nothing to show for it once she turned 19, and she was then skint. She's almost 21 now and she says she wishes she'd saved the money. But it has taught her a valuable lesson about money and she's very good with her money now. Saves up for holidays, paid for herself to learn to drive and passed her test. The only debt she has now is her small overdraft.

JackieOHHH Mon 22-Jul-13 17:23:06

Youthecat - sounds like the same sort of account.....thanks.
Thanks everyone for your input.

YouTheCat Mon 22-Jul-13 17:17:39

I have some money I've been saving for dd and ds (started when they were 6) and I purposely decided on the 15 year plan so that they are 21 when they get the money.

At 18 it would go on booze. I'm hopeful, that at 21 it'd go on renting a place. (It's not really much 2/3k depending on interest rates).

I think giving your dd some of the money and saving the rest is a good option.

oscarwilde Mon 22-Jul-13 17:10:07

YABU and YANBU - but I would ask her for a copy of her financial plan to fund her current lifestyle, driving lessons, use/purchase of a car, uni fees and living costs, and other miscellaneous before handing over the reins grin

17 is not too young to manage her own money. She could be managing her first child in theory so it might be time to sit her down and introduce her to your money worries. That you want her to be able to go to uni but have concerns about affordability, and that you are anxious that she will whittle down a sum of money that has been built up over a period of time, and will later regret it.

It might be useful to take another tack entirely which is to say that between the two accounts, that it is a good opportunity to look at her savings "portfolio" and to try to maximise her interest on the accounts. Does she want a shares ISA for example? Make her think about growing the money rather than spending it. I had a small sum of money [less than £300] as a child which my Dad invested into stocks and shares with my "consent" @12 yrs. I followed the stock market weekly with him tracking my investment and cashed it in for 10 times the initial investment 10 yrs later when the shareholders were bought out and the company taken private. It was a huge lesson.

ImperialBlether Mon 22-Jul-13 17:04:23

Cantspel, that's when the OP has to refuse driving lessons and a car, then.

Fairyliz Mon 22-Jul-13 17:03:59

I've got about £8000 put away for my teenage daughter who is 19. Its a combination of money given for birthdsys/christmas when she was small and money I have saved each month. I have told her it is towards a deposit for a house and she seems to have accepted that.

lastnightiwenttomanderleyagain Mon 22-Jul-13 17:03:36

I'd let her blow a bit on a wardrobe, but definitely not all of it. One of my university friends spent her first student loan installment on a beautiful but completely impractical cream Karen Millen suit during the first week of and then had to live off rice and beans for the rest of the semester. It was an expensive but very effective learning experience for her.

I think it's valuable to have that and realise how easily money disappears when she's still young and can learn from it without major incident.

cantspel Mon 22-Jul-13 17:01:56

When she becomes 18 only she will be able to access the money and you as trustee will be redundant. You will not be able to have any say or stop her from withdrawing the money. Even if you keep the book all she has to do is going the branch and request a search is done to get a new pass book..

ImperialBlether Mon 22-Jul-13 16:58:16

Please don't tell her you're saving it for her and when you give it back to her, don't tell her it was her board, just that you're giving her some money. She needs to know that she has to contribute.

JackieOHHH Mon 22-Jul-13 16:54:09

Greenkit I see what you're saying...but the money is from cheques given to her for the sole purpose of being put away, and the accounts are in her name with me as trustee iykwim,so hardly theft. I found a account a few years ago that locks it away til she is 21, although I can have, I think, 2 withdrawals per year, or something.
Right now her plans would be yet another new wardrobe hmm... We will be paying or driving lessons and a car as that's what we did or stepdaughter when she was 17. We are trying to get her a job, and fair play she is trying, but nothing as yet....when she gets one, if it's a decent amount of hours & money per month I plan to take a bit from her in 'board' but actually save it for her.

Greenkit Mon 22-Jul-13 16:40:42

But its her money saved from Birthdays and Christmas, if you restrict it surely that is theft? In a loose sense, you are depriving her of her money.

Surely it would be better to discuss what she would like the money for, and help her to use the money wisely?

lastnightiwenttomanderleyagain Mon 22-Jul-13 16:36:11

I had savings and my parents sort of went down a 'kill two birds with one stone' approach when I was that age. They said that they would match my savings to buy a car, on the proviso that it was brand new (at the time I thought they were nuts, I realise now that they wanted to me to have one that was shiny and new so they could be reasonably confident it wasn't going to break down at 1am. Personally, a 6 monther would have probably done the same, also, not stealth boast. Was the basic model citroen saxo so certainly nothing flashy!).

Given your DDs age, I imagine this is high up her list. It incentivised me to save knowing that I was effectively saving double and I still had something to show for it at the end. Could this work for you?

I do think the two installments approach is good, or maybe say that she can have the rest provided she can 'justify' it to you - i.e. travelling to a significant place, investment in education, that sort of thing. Does she have any specific ideas for it?

JazzDalek Mon 22-Jul-13 16:32:13

Ooooh, I'd be worried too. I pissed £6000 up the wall when I was 21 sad. I've never had anything close to that sum again since, and would love to go back in time and give myself a massive kick up the arse. Dp received approximately £30000 from the sale of his childhood home when he was in his twenties and blew the lot before I met him.

PrettyKitty1986 Mon 22-Jul-13 16:27:33

Why is she expecting this money if it's been put aside by you?

I having savings for my dc but am determined that they won't even know they exist, never mind the amount. There is zero chance I am handing over thousands of pounds to a teenager...what a waste! We will dole it out as and when we see fit.

JackieOHHH Mon 22-Jul-13 16:21:28

When I was 21 I got some money, bought a car, then went to live with an arsehole who made me sell the car and spend the money on our lifestyle (bit like you Costypop although no where near that amount), similar thing has happened with step daughter, she got ALOT of money when her grandad died and it's all gone, on crap, and her lazy arse boyfriend not bitter, much

JackieOHHH Mon 22-Jul-13 16:18:54

H,mmmm lots of different be honest if she got it before she was 21 there wouldn't be 3 grand, it's an on going thing, I just want to eeek it out, a grand at 18 is great, but I'm worried she will need the rest for university...that's a whole other issue right now for me, how are we for to afford uni?!

Costypop Mon 22-Jul-13 15:49:43

I personally wouldn't her have any of it, unless it was to go towards a big buy like a car or house. I had £30,000 given to me when I was 18years old, compo money. The boyfriend at the time (a lot older) enougaede to spend the lot on holidays and nights out, paying his rent etc. if only I had that money now my life would be totally different

cozietoesie Mon 22-Jul-13 15:39:23

I'm not sure you can refuse to give it to her once she's legally an adult and if she knows about it and asks for it. All you can do is hold it back and delay things, I think.

(We've got the same issue which has been partly solved by simply not telling the youngsters that they have a few 000s held for them. Some day that bubble is going to burst, though. It's a difficult one. Two of the youngsters would likely continue to save it and spend only on necessities. The rest would blow it.)

ShabbyButNotChic Mon 22-Jul-13 15:28:42

My friend and her cousins all inherited from their grans death aged about 7-8, this money was put in trust until 18 as i was a massive amount, about £25k each. My friend was sensible and took £5k at 18, and left the rest til 21. She bought a car/insurance, went on holiday, and bought a laptop. And it was all gone. She was shocked at just how easy it went and didnt touch the rest until she bought a house at 23, using the rest as a deposit.

In contrast, her cousin (same age) took the lot at 18, had a fantastic 12 months on it, then realised it had all disappeared on shit . She then really struggled with debt etc afterwards.
I think you need to talk to your dd and see exactly what she plans to do with it, if its something sensible like passing her test and getting a car or something memorable like 12 months travelling i would let her have it all. If she just fancies getting new clothes and an ipad then i would keep hold if i could. Not all 18yr olds would blow it though so i think you need to have a good chat.

Thingymajigs Mon 22-Jul-13 14:25:37

I'm dreading the point when my dc's can have their savings.
I imagine it might be around 5k each which would probably be spent on a gaming laptop if I just let them have it at 18. I'm worried I would resent them for wasting money that we've saved so hard for over the years. I'm definitely holding off until 21 and even then I might have restrictions on how the money can be used.
Only you can judge how responsible she is and how you'll both feel if the money is squandered in a short amount of time.

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