Inheritance one. WWYD?

[Rewis]

This is a what would you do question.

Grandmother passed away recently and while she was alive and getting her affairs in order she had put her life insurance £30k in the name of her 9 grandchildren. However, due to reasons it was changed in the name of her 3 children (reasons made complete sense and was reccomended by solicitor, insurance company etc. so it's all legit). She had let her children know non-directly that it has been intended for grandchildren but the children can do how they see fit.

Basically now all her children are getting £10k and they are discussing what they are doing with it. What would you do? Divide it equally to 9? The parent dividing equally to their kids so then each cousin would get different amount (fam1:3kids,fam2:4kids, fam3: 2kids)? Divide based on need? Something else?

There is no legalities involved in this or anything. I'm one of the grandchildren and I have a clear opion how I would do it. However, I'm keeping my opinion to myself and won't get involved and it will have no effect on any family relations and all is fine. I'm just curious.

@Meredusoleil

I don't see why the child that has more children should get a bigger share and the one that has less children should have a smaller share. But I do also see how splitting 9 ways is treating the grandkids equally. Its just missing out the kids that I don't agree with!

But the money isn't for the kids. So how much the kids get isn't the question. The money is going to the grandkids, and grandmother wanted them all to have equal.

Then she should have written that down expressly in her will. Not just told the kids to manage it how they see fit!

Or she could have worked out the correct percentages based on the number of grand kids each kid has and pay the kids that correct percentage. So then all the kids have to do is split between their own kids. Rather than faff about with their siblings as well.

Not a life insurance, but my grandparents had a very similar situation with 3 kids and 9 grandkids (split 2,3,4). They split it 50% to the 3 kids (so 16% each) and 50% between the 9 grandkids (5.5% each ) which everyone seemed quite happy with. Appreciate that this wasn’t an option in your grandparents case due to it being life insurance payout rather than inheritance. It did seem quite fair though.

Really? I have 4 dc, older db has two as does youngest db. I'm not interested in my parents money or house at all. Infact at the time my dps has a massive house fire it was then childless db1 that stamped his feet about it being our inheritance, it's mum and dad's house ffs.

Technically it's the kids money now sadly.

I think inheritance should be split between immediate children, not grandchildren. Otherwise it’s unfair - you might have four grandchildren on one side and none on the other. Leave it to the children of the deceased and what they do with it then is up to them (FWIW, I have two DCs and my only sibling has one, so I’m practising what I preach).

@Meredusoleil

Then she should have written that down expressly in her will. Not just told the kids to manage it how they see fit!

OP says that grandmother's intention was for the grandchildren to each have an equal share. She's entrusted her children to carry this out. She must have thought (perhaps wrongly) that her children would see fit to carry out her wishes.

I would think in agreement with her original idea, in which she clearly indicated she wanted an equal division among the grandchildren, and not some to benefit more than others. The parents should not have any personal say in this, as the money is literally not intended for them (they have been allocated their own inheritance to do with as they please). They are now in reception of the money, as the mechanism through which to gift it to the grandchildren changed from direct to indirect on the basis of legal/technical reasons, not because grandmother felt any different about the original division itself. Leaving it up to the parents to decide now (leading to inequality among grandchildren) is following the letter of the law, but not the spirit of what grandmother intended with her gift.

I would personally not be comfortable knowing I got more money than another cousin, who stood in an equal relationship to my grandmother, simply by virtue of having less siblings (a factor outside my own and their control). And if I was one of the grandchildren receiving less than grandmother intended, I would feel disadvantaged by my uncles/aunts taking this decision (and would judge them for negating grandmother's wishes to blatantly benefit their own children at the cost of (more numerous) nephews and nieces whose interests they should also have at heart as loving family members).

I think now the grandchildren know the money was initially intended to be split equally, any unequal split would place a bomb under family relations.

Interesting responses. Inheritance alltohgether is an interesting topic and it has a lot of feelings involved.

Is it the sibling with 4 children that is more focused on the 'original' intention, by any chance?
Actually, they are not :D

I think it is sad when children are missed and grandchildren given it all.
That is not what is happening here.

Then they should put the money in trust until the grandkids are of age and they get equal shares of their parents portion iyswim?
This is an interesting idea. However, in this case the youngest grandchild is 30 years old.

My grandmother was a smart and sharp woman and I'm sure she knew that not having it written down was a "risk". It's hard to explain but she was more like "this is something I've been thinking but you do you". All the ideas of % etc. are interesting however she had a very simple will and there was no intention to make this complex.

It seems to me the intention is for 9 equal shares so that is what I'd do.

I’d divide it equally between the grandchildren - and as a grandchild, if I was one of the family of two, I’d be letting my parent know (gently) that I thought this was the fairest way of respecting your grandmothers wishes. This is assuming that all of the children are onboard with passing it on to their children.

If it was my family, we'd probably all agree on an amount the grandchildren were getting "from Granny", say £3000 or £3500, so they all got the same, then we'd each give it to our own kids out of our £10K, topping up from the rest of the inheritance or keeping the remaining money. So each family would receive 10k, and then the family with 4 kids would top up the insurance money, and the family with 2 kids would have a bit left over.

And if other children were born later, we'd probably try to give them the same amount.

Split equally between the 9 grandchildren. Otherwise the go from the 4 children family will be getting significantly less than the go from the 2 children family. As their parents are already getting a decent amount of inheritance as well it’s up to them if they want to pass on any of that to their own children.

@SinisterBumFacedCat

Well that will happen with most things as they decided to have 4 children

Something quite similar has happened in our family.

Oldest DB has 2 adult children, other brother has 2 adult children and 2 infant Grandchildren, I have one DC.

My mother gifted each grandchild/great grandchild £20k plus another £5k in her will.

Arguably "my" little family's share is £25k, whereas my middle brother's offspring get £100k.

It was her decision, and I respect that. Nevertheless, I do feel a tiny bit miffed.

Are OP's 'grandchildren'/cousins close? I.e are they likely to find out that Cousin A got £500 and Cousin B £200 (or whatever you siblings decide to dish out)?

Is it worth a family row?

Split between 3 children and they can then give it to their respective children

This is what I would do. It's also what we are doing in our family with,
Sort of, a similar situation. I have the most kids but it would feel wrong to take more of the pot because of it.

Divide by 9

The point some people are missing in the debate is that an insurance payout to named beneficiaries falls outside the estate and doesn't get included in the will. The insurance company will pay out according to the policy. I suspect that the reason it was directed to the children would have been to negate the need for a trust of some sort if the gc were under 18.

@GiantCheeseMonster

I think inheritance should be split between immediate children, not grandchildren. Otherwise it’s unfair - you might have four grandchildren on one side and none on the other. Leave it to the children of the deceased and what they do with it then is up to them (FWIW, I have two DCs and my only sibling has one, so I’m practising what I preach).

Her children are inheriting 65k each….

Each child is getting 75k (inc the 10k)

Surely they can give their children xx% of the amount

My parents decided to allocate a third of their estate to their grandchildren but split equally between their two children's families (IYSWIM). This meant that my son received a 6th of the estate while his two cousins had to share their 6th. This caused a lot of upset - especially for my grown up nephew who really resented getting half what DS his teenage cousin received. None of us knew anything about this until DM died and DF was too ill to consider changing his will. It just added to the grief at a sad time. Wish they'd said something in advance.

@Travellor

The point some people are missing in the debate is that an insurance payout to named beneficiaries falls outside the estate and doesn't get included in the will. The insurance company will pay out according to the policy. I suspect that the reason it was directed to the children would have been to negate the need for a trust of some sort if the gc were under 18.

Yes OP is one of the grandchildren who was originally due to get 1/9th of the payout.

Now their parents have a 1/3 payout (and it is left to their (and their siblings') discretion who gets how much, if anything.

It must be particularly hard to stomach if some cousins appear wealthier than others.

the youngest grandchild is 30 years old

equal shares to each grand child, then. Because doing it as £10k to each middle generation would still potentially benefit the middle generation -- but due to ages of the grandchildren, the middle generation don't need ££ in same way as if they each had a batch of young children.

It would have been easier to have left all the DGC £3,300 in the Will and for the insurance policy to be paid to the 3DC.

If the money is shared 9 ways, each gets £3,333.
If shared 3 ways between children and each third distributed amongst the respective grandchildren the ones from the two child family get £5k and from the 4 child family £2,500.
They are in their 30s and upwards,
The variation either side of the 9 way split amount is unlikely to be life changing.