Trust fund for children set up by pil

[PoppySeed2014]

Completely prepared to be told iabu. I really don't know...

We have 3 dc and are struggling a bit financially. Nothing dreadful but we've got into about £3k debt paying nursery fees etc.

My pil have set up trust funds for our dc which they (and only they) can access at 18. The money can't be touched by anyone till then.

Aibu to feel a bit weird that my pil have effectively entrusted my dc with large chunks of cash that my dh and I have no say over? I'm hoping they'll be mature, responsible 18 year olds who'll use the money for university. But... I just feel a bit uneasy.

I would rather the money was put into an account that we can use for their education now or save for when we feel they'll be responsible enough to use wisely.

Hit me with it. Aibu?!

Haven't read the whole thread, but I work in this area and would make the following comments:

• There is a statutory power for the trustees to advance the trust income to a child's parent or guardian for their 'maintenance, education or benefit' (s31 Trustee Act 1925). This can be expressly excluded by the trust deed, but it rarely is. So for example it is common for trust income to be advanced by trustees to pay children's school fees etc. Obviously you need a big trust fund to produce a worthwhile amount of income, especially at the moment!
• I would be concerned about the children receiving at 18, especially if this is a large sum. I would usually advise that e.g. the children receive at 25, with discretion for the trustees to advance all/some of the capital to the children at 18 if they are mature enough (and thereby getting the inheritance tax benefits of receiving at a younger age).

It might be worth discussing these points with your PIL, although I guess it depends how well you get on with them.

My parents are doing similar for my dd's, not a trust find but paying the full isa entitlement for them.

I don't have an issue with me not being able to touch it but I'm also not necessarily happy with it being available at 18, would prefer it to be 21 or 25 as they're likely to be more thoughtful with what they use it for.

Just have to hope I can instil financial responsibility before they get to 18...

Seriously? your a SAHM with 3k of nursery fee's so you want the money now but you can pay off the debt in a few months anyway?

this^

Basically you want to take your kids money and squander it on more "stuff" for yourself. The selfishness of people on mumsnet I have seldom seen anywhere else, and that's the honest truth

DS will save his, I'm not so sure about DD.

Fuck off fuckoff and read my comments on the thread

What "stuff" do I want to buy?! This isn't about me having the money my pil want to give to my dc. It's about not necessarily wanting them to have a huge fund at 18!

Pondering a life where I bought "stuff" for myself with my dc's money...

The bastard Just kidding :)
I can see why it would annoy you (because you have had no say) however you need to see the bigger picture here. Who knows what the future will bring? That trust fund could really help your kiddies. You should feel incredibly grateful (which I'm sure you will eventually).

phoebe I really am grateful. It's lovely that they've done it. I just would feel a lot more grateful if they'd talked it through with my dh (their son!) and me first so we could agree a later age to inherit. But I am grateful.

My husband had a trust fund set up by his gran for when he reached 18. When he was 18 he was a git and she pushed it back so he had to be 21 before he got it. Could you not talk to the pils and ask about the age?

18 is too young to be entrusted with a large amount of money, I think you PIL have the right intentions but they are not doing your DC a favour by giving them so much money at such a young age.
I would talk to them about how you feel. They are you DC after all.

poppy

anyone receiving any kind of money from anywhere never goes down well on this site, there is a hard core of socialists on here more suited to North Korea....

TBH the best age to get any substantial amount of money would be around 30.

and then in 5 year increments up to death

Sounds like the trust funds are ISAs? Most people don't realise when they set these up that the child has complete control of them when they are 18 and nothing you can do to stop it. When we looked at setting a small sum aside each month for our kids I looked at CASH ISAs and ran a mile because of this. As we are putting the money aside I think we should have a say in how it is spent.

It is probably a tax thing, giving the money away now (as long as they don't die in the next few years) avoids inheritance tax.

Do they know you are struggling financially? Would you be able to ask for some help?

I completely disagree with some on here about breaking even for working after nursery fees etc. You might want your children to go to a nursery to help them; good childcare isn't just someone to babysit your children.

Also if you give up your job when you have children you are probably going to want to find another one at some point, try applying for a job when you have children!

I think you are being unreasonable. We are almost mid fifties now and our DC are 16 and 19. I was a SAHM and the children went to a private nursery at three for five mornings because we could afford it. There was a state one available if we hadn't been able to afford it and it was just as good but only for 2.5 hours 9-11.30 rather than 9.15 - 12.15 which suited me better and I had a choice.

Our DC have trust funds which will pay them an allowance for university expenses from the age of 18. They will not have access to any capital before they are 25. They were set up by us for tax reasons.

I am sorry to say OP that if our DC were in relationships where a partner did not work and had run up debts relating to child care costs I would be very disappointed and I would make sure that my money was ringfenced to grandchildren rather than squandered on life style choices that were beyond the means of my dc or their partners.

*Hit me with it. AIBU?!'

Yes. Very much so.

You have got in to debt, and you would like to use it to pay off your debt.

As for the age at which they get it, communicate with your in laws for goodness sakes. Just ask them to make it 21 or 25. Although at 18, that will pay for university all being well, will it not?

I would also be worried about them blowing it at 18 but think it's a lovely gesture of the GPs.
If they put it all into one discretionary trust, then the trustees (presumably your PIL or maybe yourselves?) will have control over who gets how much which could depend on what they intend to spend it on - might be worth asking how they've set it up. If they have individual ones purely conditional on them reaching 18 there's probably little you can do but trust them!

sigh

I don't want pil to pay off our debts. And our debts are mainly due to a house love and will be cleared by summer.

neartheeindymill I'm a bit offended by what you've read into my posts (although suspect you've just read the op).

We live comfortably and within our means. I had a good, well paid career but am a sahm at the moment because we have three young dc and we can survive with just one income.

It's been really interesting reading the comments but I'm a bit demoralised when people comment and either haven't rtft or have read into my op things that weren't there.

I think I am being a bit ungrateful - it's my terms or I'm not happy. Probably true.

I do think that we need to talk to the pil about extending the age of inheritance or somehow putting conditions on the use of the money.

The idea of 18 year old being given a really huge sum (will be 6 figures) just scares me. Not because I think they'll waste it (although they may) but I'm concerned it will take away their drive to succeed in their own right. And by "suceed" I mean be a surgeon, hairdresser, swimmer, plumber, whatever. It's not about making huge amount of money themselves. But if you don't need to work and you're young it can be hard to motivate yourself (especially as almost all jobs are a bit tough/tedious when you're starting out). Hope that makes sense.

I want my dc to have financial stability but still make their own way in the world.

My best friend inherited enough at 18 to never have to work. She went to university, got a first, bought a house. But she's never found a job she can settle in and because she's got money in trust it doesn't matter. And yet, it does matter! She suffers quite badly with low self esteem because she hasn't earned her own money and never knows what to answer to the inevitable "so what do you do?" questions.

If a job is hard or a bit dull, she leaves. If she didn't have family money at her disposal she wouldn't have that luxary and may well have found her niche by now (out of necessity like most of us!). Anyway, I think that's where lots of my fears come from. Watching her struggling with finding her purpose.

.

Yabu. The issues of you being in debt and grandparents providing money for your children are completely separate. How much money are you talking about? Thousands and thousands?

It would be ideal if they saved for uni with it. But you should carry on as if your pil's weren't giving them anything. If they were getting nothing would you still help fund uni? Honestly I'd be thankful they were getting something from their grandparents. Ds is getting nothing and he's not entitled to it, bit I'd be grateful if he did.

Sorry just read it will be a large sum. In that case perhaps asking about conditions might not be a bad thing. To be fair to other posters though, when you do read the OP it does sound like you are a bit put off because you have debt and your children will be well off later in life. Again, it's two separate issues. If it were just about setting conditions why was your debt even mentioned? It has no bearing if the post truly is about conditions on their trust.

Yeah, I think I just mentioned out debt because paying the next lot of fees is a struggle for us. But as I've said (repeatedly and boringly) our debt is small and temporary. We wouldn't commit to three lots of school fees if we couldn't afford it ourselves.

I forgot that people often don't read subsequent posts. Ooh, maybe I drip fed?! Lawks!

Anyway, bowing out here because I think I get the general consensus and I know what we need to do.

Oh, and can't resist pointing out that (as I said up thread) we are also saving using adult isa's for university fees etc. We don't spend all our money on skiing and champagne. (More like camping and sparkling elderflower)

We have 3 dc and are struggling a bit financially. Nothing dreadful but we've got into about £3k debt paying nursery fees etc.

Awfully sorry to have caused you offence but I have read the entire thread and would have had more sympathy had you been working. If you aren't working your DC don't need to be in private pre-school. They simply don't.

As for worrying about your DC not working if they have a trust fund, I know tens of children from very very wealthy backgrounds and it doesn't seem to stem their ambition at all. Our DC expect to work for a living. What financial security does buy, however, is the choice to realise dreams and that's something neither their father nor I had. We just had to get our noses down and earn it.

nearthewindymill thank you for your advice. I'll email all the parents at my dc's pre-school to explain that their children don't need to be there if a parent is at home

Or you might consider that pre-school education is a positive thing? None of my dc were in childcare nurseries because I was at home. So I did the care. But after 2, they all went a few mornings a week in term time. Bizarrely, they love(d) it and we think it's a good thing.

And we can afford it normally. By the summer we'll be fine.

Ack, why am I bothering to argue?

Better go upstairs now to riad piggy banks to buy some Prestat truffles

So to summarise the OP...

My partner and I have mismanaged our finances.

My in laws want to set some money aside for our children at some point in the future and have structured this arrangement in such a way that my partner and I cannot be involved in managing the money.

I cannot see the connection between these two things.

Well at the moment you can't afford it; and it's provided by the state.

You are being incredibly defensive for somebody so wholly in the right you know.

Wow, OP your mentioning the debt you have, can only be because you think that the money should be either given to you, or you should decide how their inheritance is spent (on preschool fees)

They are entirely right to keep you out of the equation. If they blow it, they blow it. If your thinking of spending it on nursery fees then you would squander it all by the time they are 18 anyway.