Benefiting grandchildren in will

[balzamico]

My siblings and I are soon to inherit some money and want to pass some of it (10k each) straight to our children but to be held somehow until they're 21.
Should we just do this ourselves? We have bank accounts in our under
18 year old names but what happens when?
The will is held with a solicitor. Should we get them to do a deed of Variation (I think) to ensure that it goes to the children and if so does the solicitor hold the £60k & How do the children get it when they turn 21? What happens to the interest and would that be better for tax?

We all trust each other and the children would be told (mid teens upwards)

Tia

I'm not an expert in this but my children have inherited money from a grandparent and it has been very complicated! We had to set up a trust fund with DH and I as trustees. It cost a significant amount of money to do this, and the fund will be charged additional inheritance tax every 10 years so we need to be careful to invest the money well so it doesn't shrink. We needed professional advice from a solicitor and financial advisor which was costly.
We had no choice as we had to do what was stipulated in the will, but if you can choose what to do then I'd just invest it in your own name then give it to your children when they are old enough.

My kids had money at the bank which required my signature until 23

Just keep it in a separate savings account in your name. Don't pick a random age to give it to them. Give it to them when they really need it for something.

I speak from experience of having dcs who were given a few thousand each by PILs when they reached 18. (I did ask them not to but was over ruled). One blew most of it on something they never used. The others had some very good nights out 🙄

Now 2 of them are saving for deposits on property and another desperately needs a new car 🤷‍♀️. That money would have been a massive help.

Whatever you do try and make sure the money is invested properly. Do you max out your own stock and shares isa for instance?
If not perhaps you could invest through that?
And saves for the them.

Am following this thread, MIL recently passed away and her will stated that a quarter of her estate is to be left to her 2 grandchildren (my DCs) and they will receive it when they turn 21. Was hoping it could be put into premium bonds or something similar meantime, they are still primary school age so a while before they can get their share

Is the reason that you're trying to tie this up with the will because you're hoping to alter the amount of inheritance tax you pay? Or will the split amongst grandchildren alter the split among you and your siblings (eg if one of you has 6 kids and another only 1)?

Otherwise I can't understand why you're complicating things and conflating them. Just inherit your share, then invest the money you want in a junior ISA or whatever other form of investment you choose.

Just keep it in a separate savings account in your name. Don't pick a random age to give it to them. Give it to them when they really need it for something.

This would be my thinking too.
I would, perhaps add a letter of wishes to keep with your will, explaining your intent should there be some tragedy that meant you weren't still here to control this.

Mine would definitely have used money differently at 21 from what they would have at 25.

Am following this thread, MIL recently passed away and her will stated that a quarter of her estate is to be left to her 2 grandchildren (my DCs) and they will receive it when they turn 21. Was hoping it could be put into premium bonds or something similar meantime, they are still primary school age so a while before they can get their share

Just agree before it happens, what will happen if one of their bonds wins a significant amount. There was a big difference of opinion on here last month when that very scenario occurred, whereby Grandparents' money had been invested in PBs for the dc and one had won a significant amount, and the ethical, moral and legal dilemma of if that should be split or not.

@InTheCludgie

Why pb? Average is 1% interest?
My dc isa, stock and shares for years are running at 25 ish % and gone up thousands!

Yy kite and if no dc wins they still won't have any more than they inherited which could be severely depleted by inhalation by the time they get their hands on it??

Newyearoldyou are stocks and shares ISAs risky? Not keen to have Dcs inheritance put into anything that could lose them money.

Their inheritance each is almost the max allowed for PBs so should get decent wins throughout the year. I have max amount in PBs and won over the 1% rate in the past year, so better than sitting in a regular savings account (or as my late DF would have said, better than a kick up the arse!)

I wouldn't be putting it in their names. I'd invest it and hang onto it. I can think of several friends whose children inherited and immediately blew the lot. It's too risky

It's not their inheritance so keep it in your name and dish out when you think appropriate.

Thanks all, I think that's what we'll do, there's no inheritance tax in this estate and so we'll open a separate account and keep it there until they need it

@InTheCludgie

It's a big subject.
May dc had a small inheritance and I would consider it a massive risk to keep it in pb.

Low cost index tracker funds that follow uk /us stock market.

Google it, read up on vanguard etc.

What Warren buffet says about investing.

It's risky if you buy one stock, sell it because it's price has fallen and you've panicked.

Even when covid crashed the market I was astonished at how many people wanted to sell anything in the market!!

Others (like me) were buying.

One of my purchases has gone up over 100%.but that's my fluke gamble fund.

Usually I invest in steady trackers.

But they need time to work, not short term things when you need money at an exact moment.

I had quite a lot in pb and seeing the difference between pb for larger sums and my stocks and share isa with my index trackers (mostly vanguard) moving it over was a no brainer.

An absolute no brainer!

I still have pb but for a speficic purpose.

The amount my dc has in theirs ideally would become their capital and they may not need to touch it if it can generate enough for them.

Newyearoldyou I ended up down the rabbit hole last night reading up on this, now tempted to see about investing a chunk in stocks and shares. My oldest is 11 so guess this would make sense, thanks

In the cludgie

Yes it's a rabbit hole o went down , down under and out all led me back to low cost index tracker funds esp vanguard.

Nothing fancy, complicated.

Always Google any funds you choose, check with morning star and trust net.

You need a solicitor's advice. We were in a similar situation and did a deed of variation as there was a benefit on paying less tax and the money was held in trust until they were 21, but could be accessed with consent of the trustees (as there mum I was one of the trustees) if needed before that.