Would you take money from your mum in this situation?

[RevoltingPeasant]

I am really genuinely torn on this one.

So: my mum and dad split up 4-5 years ago, DM is in her mid-60s, owns her house outright, has comfortable savings and runs her own (small, 1-person) business. Recently she put her house in trust to me and the DSisses because she says she intends to leave us the property eventually and she doesn't want us to have to pay inheritance tax. I felt pretty uncomfortable about this as it seemed like anticipating her death but I also saw it was a sensible, kind thing for her to do.

DH and I are saving for a house. I trained a long time to do what I do and I will be 34/35 before we can afford one, even on about a 90% mortgage. We also want to start ttc in the new year. But I am worried about having a baby without being close to our savings target as I think we would be unable to save much with DC here.

So my mum said recently, do I want to 'anticipate' my eventual inheritance by having her cash in some money on her house to put towards our deposit? I said no but I know this will come up again when we go for Christmas next month and I don't know what to say.

AIBU to say yes to make my life easier, or should I stand on my own two feet and delay house-buying & baby-making?

I'd take it.

I wouldn't

The only thing that would worry me is that if she gives you some money, then your sisters may want the same and your mum might not be able to afford it.

So long as your mum is sure she wont need the money at a later date and it wont leave her short, id say, thank-you very much mum and start feathering my nest :-) What a lovely thing to do, she is lucky to be able to - so long as it doesn't leave her short, it makes total sense.

How is she planning to 'cash in' some equity in the house?

I would.
You need the money now, she is in the position to offer it to you. At least she will see the benefits of the inheritance!

dexter does make a good point though, families can be torn assunder over money arguments.

I think a friend of mine did this though, he mother cashed in some money on her house, or even all of it and then split the money throughout the whole family. So no reason why your mum couldn't/wouldn't do the same.

Thanks Wiley for that full explanation seriously, why not? 'No' was my first instinct but I can't quite say why either.

cozie not sure, she might have meant actually giving me some money from her savings and then having me inherit less of the house, if that makes sense....? I think she said 'some of the value of the house'.

Yes, whether she could afford to do it for DSisses is a good point. I mentioned it to DSis2 who thinks I should.

But I feel.... icky. I mean, we both have good jobs and will be able to get a house eventually. We are not on the breadline and actually earn above average. It's just that it takes a while to do and meanwhile my eggs are shrivelling up

And you'd have to pay for your mothers care when she's older if she needs it as you'll have taken her security away ie her house

Ah - I was just hoping (and I think you need to clarify this with her) that she wasn't planning to use one of these equity release schemes - which send shudders up my spine whenever I look at the small print and the financial pages.

(I thought she might be doing that because some people can be very resistant to using actual savings - they're a comfort blanket.)

If you're unsure, why not take some money - savings - from her and pay her back including the interest she would have been making. (Likely to be peanuts and a much better rate than you could achieve elsewhere.) That would get you started.

What Gumby said. I wouldn't. I would refuse and get on with things. Having a baby is not dependent upon owning your own house. Yes it makes you FEEL more secure but really, we're all one redundancy away from homelessness anyway! Well most of us are.

When she says cash in some money on the house does she mean an equity release plan? She needs to think very carefully about it because they are not suitable for everyone, it could cause some difficulties when it comes to paying the loan back on death. I would get her to check with an IFA what is possible if the house is already in trust to you.

xposts.

If she wants to use savings then thats entirely her choice but I wouldn't want my mum to be in debt with what is effectively a lifetime mortgage.

That's true- sorry Pascha, I was having a moment there. If it's in trust, she shouldn't be able to use an equity release plan.

What does it mean the house being in trust?

How will this impact her care in her twilight year?

How will it affect your sisters?

I wouldn't either. Your situation is tough, but not that unusual nowadays for young couples who go through university and training.
There are a lot of potential pitfalls to this- what if your siblings feel aggrieved that they aren't getting the same? What if your mums situation changes and she needs the cash in the future? what if she needs money for personal care at some point- either a nursing home or buying in care which will probably become the norm in the future.

I'm sure you'll be fine standing on your own two feet. The thing about inheritance is that although you feel it will be 'your' money, there are no guarantees attached to anything. Her business may g

Make sure she's not suggesting an equity release scheme on the house. The small print on those is truly shocking! You pay back an awful lot more than you get paid out.

Would she give you a loan from her savings that you could pay back at a low rate?

Having said that, I don't think your own home is a necessity before DC although I can understand why you feel that way.

Oops- her business may Hit a bad patch... Her investments may drop in value... I don't think anyone should ever assume they will get anything, and your mum maybe needs rescuing from her own naivety over this

I would accept- your mum clearly wants you to be better off and is in a position to do so, you can always ask if how your siblings feel and what if she needs the money? If she is keen to go ahead I would be happy to, and why cut your nose off to spite your face? Many people get a leg up and i don't see why you feel you want to do it all alone, when you could be happier and nearer your dreams.

Parents want to provide and make things better for you, I would for my dc. How different is it to them paying for uni?

Is it worth banking some eggs?

I would take it, and have done so (but yes, not from equity release).

In your mum's place (and I am almost old enough to be) I would love to help my kids out while I was still young and fit enough to enjoy it. I'd hate for them to have to wait til I was dead to benefit.

Me also, actually, so I'm biased I guess. I borrowed some money from my Mum when we were in difficulty and paid it all back including interest. (Which, sadly for her, was indeed peanuts.)