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complex family finance situation

(25 Posts)
moulesfrites Thu 01-Oct-09 16:39:14

Imagine you are middle aged parents with 3dc in their early to mid 20s. You, through a lot of hard work, come into a great deal of money which basically means you are set up for life. You want to help out your dc who are starting out in their careers etc.

You decide that you want to help your dcs onto the property ladder. You agree that when they reach the age of 25 or on marriage (whichever is earlier)they will receive a substantial amount of money which should be spent on a house. Part of the deal is that your dcs must also get a mortgage worth a cetain % of this amount, so that they know what it is to earn their own money and have a good work ethic...

(Thanks for staying with me so far)

dc1 gets the money on marriage and he and his wife buy a house. They work hard and are planning on having a family in the near future but want to wait until they are more finanically stable.

dc2 has always been a bit reckless and irresponsible, and you have had to bail him out financially many times before. He then announces that his gf, whom he lives with in a rented flat, is pg. They have been together a short time. Although he is not yet 25 you decide to give him the money for the house anyway as you want your grandchild to be brought up in a family home.

However, dc2 then loses his job. he has no means of paying the mortgage, and because he has been financially reckless in the past has a poor credit rating. Do you still agree to give him the money and waive the mortgage criteria?

WWYD, and can you guess what position I am in in all this...

StealthPolarBear Thu 01-Oct-09 16:41:23

I think you're the wife of DC1
Yes, I think I'd give the moneyanyway and waive the mortgage stuff.

StealthPolarBear Thu 01-Oct-09 16:42:43

my only experience of this (only child) is through DH, who has a brother, and while his parents are very very generous they are also adamant about being 'fair' so if they've given either DH or BIL money in the past they've also given the other one the same!

moulesfrites Thu 01-Oct-09 16:49:36

Yes you got it SPB. Don't really know how I feel, I am very grateful for their generosity, but at the same time can't help feeling it's a bit unfair and they need to stop bailing him out otherwise he will continue to tkae advantage of them. At the same time I can understand PIL not wanting to see him or their grandchild struggle financially when they are so well off.

PeachyTentativelyPosting Thu 01-Oct-09 16:53:20

I think its equal or nothing.

From the POV iof the family wriitten out of MILs will for not following her rules (so possibly biased)

moulesfrites Thu 01-Oct-09 17:05:05

sounds nasty PTP sad

StealthPolarBear Thu 01-Oct-09 17:11:50

hi Peachy
I can see why you think it's unfair OP and I agree. I agree they need to stop bailing him out but the marriage/25 thing seems to imply a significant event and they probably just hadn't thought to put baby in that category. Whether he gets a mortgage or not the money they give him is the same.

moulesfrites Thu 01-Oct-09 17:46:06

That's what i'm not sure about SBP. I thought that part of the deal with getting the money was that you had to get a mortgage, so if you can't get a mortgage, does that mean you don't get the money?

The thing is, now that he has lost his job they may not be able to pay their rent either, so PIL will prob end up helping with that too...

Another option that they have apparently thought about is not giving them the full amount of money and putting the rest in a high interest account, so that they can live off the interest if gf decides not to go back to work...

Oh to have the luxury of that choice ...I worry all the time about what I would do about work if/when we had dcs.

Just seems like you get nothing for being good...

Hope I don't sound really spoilt and ungrateful here, I realise I am in a better position than many others...

PeachyTentativelyPosting Thu 01-Oct-09 18:14:56

LOL- it'snot nasty, I kinda find it therapeutic that even when MIL has gone she will continue to remind us of her lovely charm (rules we broke was continuing contact with FIL after divorce btw)

Personally I would doubt he'll be unable to pay rent- depends on housing etc but he could claim housing benefit on that but not a mortgage.

But personally I would give them a sum- its hard to know without amounts but maybe 10%? to help out aut, but making sure they forfeited that from the lump sum due later IYSWIM.

I do think the marriage clause is a bit unfair- not everyone wants to get married and that is fine these days, a child is mroe binding in my experience (I am married btw so no agenda)- there's a definite case to argue for this being equivalent.

BTW you can wait forever and not be able to afford a child, but if you go ahead and have one then you'll find ways. Just my experience there.

JeMeSouviens Thu 01-Oct-09 18:26:09

My xFIL offered each of his son's an amount to get them going, after his eldest had a large sum for a business which he subsequently squandered. My xH turned the offer down, of the others, he invested in one's house, but they have to pay it back, gave another money towards a house, but they don't have to pay it back. It was a cockup from start to finish, and made it quite clear what he thought of each of his sons and their spouses.

In fairness, I do think that the same conditions should apply to the gift for each DC, but if DB2 isn't in a position to pay a mortgage this will be tricky.

Are your PIL that well off that they can actually buy him a house outright? With him owning a portion of the house, to the value they would have given him, then he pays them "rent" which would be like paying a mortgage, and eventually once he has paid it off, he owns the house? iyswim

FabBakerGirlIsSURVIVED Thu 01-Oct-09 18:28:32

There money, their decision.

If you are the wife of DC1 it isn't hurting you that DC2 is getting financial help. You still got yours.

NorkyButNice Thu 01-Oct-09 19:31:48

God I hate family money issues.

My mum inherited my grandpa's flat and my brother and sister (25 and 32 now) both lived rent free in it for 4 years.

My sister is now engaged and they are planning to sell her and fiancé the flat at under Market price to help them get on the market.

DH and I have just had an offer accepted on a place at ages 29 and 35 as we've had to save up to afford the mortgage (and we weren't living rent free for 4 years).

It's nor fair, but it's their assets, not mine.

RealityIsAnAuntie Thu 01-Oct-09 19:34:53

Message withdrawn

gothicmama Thu 01-Oct-09 19:40:52

is this more about you wanting achild - if you wanta child and dh does start trying cos there will never be a right time financially

I think when it comes to family it should be teh help the individual needs at the time - not a one fits all policy

moulesfrites Thu 01-Oct-09 19:46:15

You may be right gothicmama. Perhaps this is why it is bothering me so much. When the pregnancy was announced a few people made comments about us being usurped, and I didn't really think anything of it, but now that it has sunk in that I do feel a little bit resentful, though I feel disappointed in myself for feeling that way.

The thing is, now that she is pg PIL are not going to watch them struggle, and I know that they would do the same for us, but I would never embark on starting a family assuming that they were going to help out IWSWIM.

gothicmama Thu 01-Oct-09 19:51:30

Ikwym it is difficult decision to make although if you ant a child you can usually find a way tomanage finacially

EldonAve Thu 01-Oct-09 19:51:45

Life changes things
It's their money and they can change their rules if they wish

wonderingwondering Thu 01-Oct-09 20:02:22

It is your PIL's money. It is no business of yours what they spend it on, give it to, whatever. That sounds harsh, but it is true.

I don't believe in one-size-fits-all, nor do I believe financial help=love or affection.

I'm one of four, and three of us are comfortably off. One brother less so. My parents said they are going to divide their estate so he gets more. That is fine by me - he needs the money, I don't. It is my parents money, their choice. I know they love us all the same. And I know that means his wife will benefit (over me/my children?) but I don't feel any sense of ownership over my parents' money.

The thing I don't agree with is the 'condition' of a mortgage. If you are going to give money, give it freely, without expectation or obligation. Otherwise hang on to it. You can't control how other people live their lives - you can't control your PIL; your PIl can't control their son and his girlfriend.

Money and family can mix, it's the strings attached that cause the problems.

moulesfrites Fri 02-Oct-09 18:49:55

It is interesting what you say about no conditions wondering. I had always thought the mortgage thing was a sensible idea but recently have thought it seems a bit controlling. They have now told BIL that he needs to come to them with a spreadsheet of all their income and expenditure before they can help them with buying a house - which seems more controlling than ever, but perhaps understandable given BIL's behaviour in the past...?

wonderingwondering Fri 02-Oct-09 19:00:10

No, it's not understandable, it is infantilising him, and reinforcing his immature and reckless behaviour: by monitoring his expenditure your PIL are taking responsibility for it. He's a grown man, not a fifteen year old, and treating him as a child won't help him grow up.

If they 'give' money they have no control over it - they don't get to say what he spends it on. If they still feel a sense of ownership over the money, they haven't 'given' it - they've bought themselves a stake in their adult child's life.

This is a little bugbear of mine: I've seen so many divorces happen where one set of parents are overly involved - often being 'helpful' or 'generous', whether with time or money - but that help and generosity is often to the detriment of the couple's relationship, as they never have to struggle, prioritise or take responsibility.

I can understand how you feel about being the sensible one. But you will always know that you and your DH have done it together, created your own family, done it your own way. And I think that creates a stronger marriage.

moulesfrites Fri 02-Oct-09 19:07:14

You are right wondering. i do feel that they are sometimes too involved with them, but then is it just a natural parental instinct not to want them see him go without, esp as they have so much? Sometimes he will say on facebook that he has had a takeaway or been out shopping and PIL and other BIL will get stroppy about it, thinking he shouldn't really be doing it as he can't afford to, but I would hate to think anyone was judging how I spend my own money in that way.

wonderingwondering Fri 02-Oct-09 19:24:49

It is a natural parental instinct, but there comes a point at which a parent has to step back and accept the choices that their child has made.

You can't impose your own values and priorities on your children: if they are not driven by wealth or ambitious in their own right, you can't 'create' that at the age of 25 by saddling them with a massive mortgage!

DuelingFanjo Fri 02-Oct-09 20:03:40

it's their choice. if they haven't asked for your input then I think you just need to keep out of it.

On the other hand, if they are involving your DH then I can see why it might be stressful for him and by extension for you.

vinblanc Sat 03-Oct-09 11:22:17

Sounds like the Parable of the Prodigal Son.

moulesfrites Sat 03-Oct-09 16:46:02

Thanks for all your advice, has helped me to get a grip with the situation, just wish I could stop feeling a bit bitter about it all...

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