The question of inheritance

[tiggerkid]

Hi all,

Not sure if this is really the right thread for this but can't think of any other to discuss the topic of inheritance.

Recently my sister-in-law and her husband announced that she is pregnant with her 3rd child and because they need a bigger house to accommodate, they will be moving into my MIL's house, who has a much larger property. Naturally, they understand that this move will raise the issue of inheritance, so they decided to sell their house and give us a small proportion of the value of their house on the grounds that they will still need money to look after MIL and renovate her house to their taste. The house is currently decorated to MIL's taste and, apart from the fact that it's cosmetically old fashioned, there is absolutely nothing wrong with it. MIL is certainly happy with it the way it is because she's been doing various work on and off in keeping with her own taste.

At present, MIL doesn't need any looking after. She is in excellent health and is of sound mind, so as far as we are concerned, they only want to move in to extend their living space so to speak. Because they live nearer MIL, they've had plenty of opportunity to talk her into this idea and convince her that it will be paradise on Earth once they all move in together.

While I completely understand and agree that the party looking after ageing parent absolutely needs a bigger share of any inheritance, am I being unreasonable believing that 1) it should be a discussion involving all parties affected by such a decision 2) any agreed value of our share of inheritance should be based on the value of MIL's property rather than the smaller house that my sister-in-law is seeking to move out of? and 3) the question of keeping large sums of money to redecorate the house to sister-in-law's taste should be out of the question because it has nothing to do with looking after ageing parents?

Sorry for the long message but I just find it so unfair that my sis-in-law just decided to move into a bigger house to improve her living conditions and keep 80% of the value of their own house to do whatever they want to do without ever discussing it with us or giving us any opportunity to speak about this. MIL has only mentioned it to us in passing and doesn't want to discuss this any further because she wants to avoid confrontation. The only thing she said was: well you, guys, are financially better off than they are anyway, which made me even more annoyed and upset. If there is a reason why we are financially better off, it is because my husband and I work our butts off while my sister-in-law sits on her backside playing on Facebook all day long. It feels like MIL believes that we need to be punished and penalised for our hard work while my sister-in-law needs to be rewarded for her Facebook efforts.

I know in the end it is MIL's decision and, unfortunately, one that appears to be driven by my sister-in-law exploiting MIL's fear of being left alone in her old age. Although I doubt that we can do much to change the situation, I am struggling to keep discussing this with my husband as I don't want to upset him but I do need some emotional support and understanding, hence this post. Thank you, all.

Well I think that your DH will have to carry on talking to his dm. Because yes things could get very ugly. Caring for 3 young dcs whilst having your mum in the way (because she will be. It won't even be her house anymore. Not on paper but nit even in decorating therms once the 'freshening up' will have happened). In my experience living together as an elderly woman who has her own ways if doing things, is getting tired more easily and is used to quiet and a family with young 'vibrant' very noisy dcs is that it's likely to be a nightmare because the needs of the different people involved are so different.

Your DH needs to get advise from a lawyer and see what is ok to do re donation. Then feed it to her. Not in a 'you can't do that because xxx' but in 'do how are things going on? Has SIL already given you the documents for yyy?' Maybe give her some documentation about gifts like this and issues that can arise? In effect give her awareness of the problems that can happen whilst not engaging in whether it's right to do so it not.
And reassure your mil that she doesnt have to be all alone if it's what really scare her.

I don't like grabbiness at all but YANBU to feel hurt by this.
I don't like the sound of it at all. SIL sounds very grabby.
Also , however well they get on I can't see that living together is going to be paradise-unless there is absolutely loads of space and MIL has her own private area.
It could all go pear-shaped.
However I don't think as a DIL you can do anything about it.
Your DH has already tried to talk to his Mum and if she doesn't want to listen there is nothing he can do.

Why on earth are the family paying for holidays for her?
I wouldn't dream of asking my adult children to fund leisure activities for me- if she can't afford it she should do without it!

If she is reasonably healthy and sensible I wouldn't be too ready to fish her out if this goes wrong. If she can make her own choices she can deal with the consequences. Just give her the number of housing associations that do retirement apartments.
I would just remain polite but stand right back-she'll do what she wants to do.

This is actually what my SIL and her husband are proposing. I do wonder whether they have had a third child to get the bigger, more valuable house of the PIL. The second SIL and her husband haven't agree to it yet. I'm cynical and expect a competitive pregnancy announcement from them soon. Meanwhile the PIL are happy in their house with two sets of children and their families spending their entire social lives trying to get up the inheritance ladder ahead of the other.

Me and DH have less and less to do with them. Don't want an inheritance, won't get one. So much more time to work and buy our own property and have a normal social life without the hanging around waiting for an inheritance carry on.

Birdsgottafly, I don't know how likely it is that SIL will either fail to get on with MIL and kick her out or make her life hell, but given the fact that it's not her daughter but DIL, I am guessing anything is possible.

I think at this point, everyone is going to wonder what SIL's husband, i.e. MIL's other son has to say about this. Not much. He is very much in agreement with the idea as they've come up with it together. Plus, he is under SIL's thumb, so no argument is expected here. He won't listen to us as he's always wanted MIL's house.

PS how old is she? Deprivation of assets only applies if she needs a nursing home within the next 7 years, I think.
I also find the talk of "changing hr nappies" distasteful. This only happens to an unfortunate group of people who live for a long time in a dependent syate. (I know because my 94 year-old Mum is one).
She may die suddenly before this happens for all you know.
God forbid that my kids would have to change my nappies-straight to a nursing home for me if I can't manage it myself.

YANBU

My sister moved in with dm and was gifted a part of the family home, so that she could raise a mortgage on the rest and pay off the equity release on it my dad had rather unwisely taken out before he died. My sister and mother were very keen for my brother and I to be ok with this before my sister went ahead and took out the mortage.

I think these things shouldn't be presented as a 'fait accompli' - it's not respectful. An inheritance can be life-changing, especially these days with the way the property market is. Perceived biases and inequalities can destroy families in the aftermath of a death. I would want to be absolutely scrupulously fair with my own children, as my aim would be to foster good relationships between them.

Would add, I'm happy for my sister to have a larger part of my mum's estate than me because she is such a good and generous person. She would always do the right thing when it came to money, and I'm so, so happy that she's living with and looking after my mum (who is 80 but fit and well).

If it was my SIL... well, different story....

drudgetrudy, MIL is currently 70 but her DM lived till 98 and there is no reason for us to believe that MIL will live anything less than that TBH. She is in a very good health and definitely doesn't need any looking after by anyone at present. Nobody knows what the future holds but as I said, personal hurt aside, there is a concern over what's going to happen if the promised paradise with SIL doesn't materialise. As much as I would absolutely help my husband out to look after MIL if this was required, I'd be extremely annoyed if all MIL's money are spent by SIL and her DH on the bigger house and their needs and when the time comes to look after then penniless MIL, it falls on us to pay for her needs! As "grabby" as it sounds, nobody at the moment can guarantee that this will not happen.

I am assuming that this is exactly why so many people are suggesting to seek legal advice which SIL doesn't want to hear about. MIL is completely sided with her as she is the one promising this paradise. I am guessing all we can do is wait and see what happens really...

Oh - from your earlier posts, I read it as your SiL being your dh's brother.

Maybe there is a better chance then of your dh and his brother sitting down with their Mum, with a whole list of things to consider - so many of which have been brought up by this thread.
Your dh can start from the point that if his Mum chooses to give all her estate to just one of her sons, then that's her prerogative, but has she considered all the things being talked about here.
Asking your BiL what if Mum needs this sort of care or that - how is SiL going to cope with that. How is MiL going to retain some private space / some autonomy in her own home (I've not inferred that there is the possibility of a granny flat here?), etc.,etc.
Say that you aren't entirely sure of all the details, but surely you have to all take advice on care home fees being paid from the sale of her home and what happens if they are still living in it - or - what about if it were BiL that got hit by the proverbial bus - how would that effect things, etc.,etc.etc,
All your dh can do is make it very clear, this isn't about the inheritance, but it's about making sure all his Mum's assets are protected and all her feelings are considered.

I've not read through the whole thread BUT basically:

Your MIL has two children.
One child decides to move their family into MIL house and look after MIL in old age.
They plan to sell their house and give you some money now so that when MIL dies, they do not have to sell the house and/or give you any of the proceeds.
The money that you get given now will be spent. They will always have the house which may gain value.

I think that YANBU - and would also have concerns about MIL being made by your SIL and her DH to make decisions about her finances.

Indeed, it is up to MIL what she does with her money/house - but think it is off for SIL to offer to "pay you out".

The house could be put into your DH and SIL's joint names when MIL dies allowing you to access the proceeds when SIL sells - and when DH/SIL die it can still be passed on through their Wills.

I would suggest MIL gets some independent financial advice.

Inheritance is one of those subjects that causes MN to come over all sanctimonious. I would feel, like the OP, that this subject needs wider discussion with the family. In my DH's family, there has been a veil of silence on the subject, with the result that 30 years ago DH and my FIL entered into an arrangement which has seriously hacked off his brothers and sisters ever since.

It really is your MIL's decision to make. Hopefully she has not been coerced into it. And I agree that you should keep absolutely out of it and let your DH say something if he feels it's necessary.

But I can understand why you feel annoyed at the family moving into this nice big house. And they do have a bit of a cheek re-decorating to their own taste when it isn't even their house. On second thoughts they sound complete grabbers. I don't think I'd want to accept a portion of their money.

What a rotten situation to be stuck in the middle of and I can see why you are upset - basically you feel your husband is being treated unfairly and you are upset on his behalf. If he won't have the difficult conversation himself though, then my advice would be to back off as difficult as it is to see your partner being treated badly.

Perhaps the simplest solution is to get DH to point out to his brother that in order to
a ) avoid some fairly serious tax complications a legal agreement will be required
b ) some legal protection should be in place for your MIL so that she can remain in her home until she dies if she wishes. The implications of that on your BIL and SIL should be pretty damn obvious
c ) if your BIL and SIL divorce, then where will the property go?
d ) in taking on the property and accepting a lessor inheritance, that it is your DH's position that he and you will not be liable for any future healthcare costs for their mother.

Then I would sit back and pray that a decent solicitor will point out enough pitfalls to the scheme to protect your MIL and ensure that she has a nice old age without her children fighting over who feeds and cleans her up.

So SIL is a DIL also?

Where's her husband (MIL's other son?) in all this?

For me it sounds ridiculous all round tbh.

Nobody is secure are they?

Can MIL really just give her house away & therefore avoid future care fees just by living another 7yrs?

If so, why doesn't everyone do it??

SIL might not want to hear legal advise but tbh any legal advisor worth their salt would tell the same to your mil. Giving the whole house to the SIL is a dangerous thing to do.

Maybe the place you hope to do donething is there. When your mil us going to go and see a solicitor/lawyer to sort out paperwork, then that person should step in to point out all the pitfalls and issues (incl what happens in case of death if her DH, if they get divorced, they don't get in as a unit etc) and also the issue tax wise ie if your mil needs care in 5years time, she will be expected to pay as her house will be included into her assets. Then who will pay? (See issues where people are being gifting their house to protect the inheritance but it is considered that the donation isn't valid yet as it has been less than 7years).

It might be that your mil will not listen but at the very lies at you will have tried your best to give her information.

You might also want to see with your DH what would be your stance if your SIL and husband are going ahead and then come back asking for money to pay for a care home, care at home or whatever.

I'd also be passive agressive and take the opportunity in front of MIL and SIL to say
"Gosh - that sounds like a such a good idea. You'll be company for each other since you don't work SIL. It's a great opportunity to put in a bathroom suitable for an older person too.
To MIL (in front of SIL) say - "I think it's lovely that you have a daughter who is prepared to care for you so that you can spend your latter years in your own home. I'd hate to die in a nursing home but I can't see my kids prepared to feed me when I can't manage it"

If your SIL is prepared to take on caring for her mum then she earns her extra inheritance in my book. If not, then I'd be seriously hacked off at her manipulations.

How long before Granny is in an annex at the bottom of the garden do you think?

Having read through the thread now - when MIL goes to solicitors to get house transferred to SIL, they'll ask her about her daughter's coercion - hopefully that will help her to understand this isn't right.

diddl a lot if people do as long as it's under a certain threshold (I think it's about £200k) and done with the right time scale. My parents certainly have.
The issue is that a lot of 'family houses' are now well over that limit so you can't just 'give it away'. And if there any other assets, ease still have to pay done of the fees.

Usually people are also careful to have some limits (eg the give the ownership but still keep the use of the house, house can't be sold to their consent etc)

there is no time limit on depravation of capital (i got the name wrong before) and if i was a hard pressed council i would look very hard at anyone like to have a massive asset than that appeared to have very little.

besides, i would not want want a relative to have council limited care when they could afford better using thier own money.

SIL is not caring for the MIL (whic would be very admirable), just saying she will at some point in the future...

which is not the same thing at all.

I really don't think YABU at all and I hope your MIL gets good legal advice.

It may sound hard but if she doesn't listen and allows SIL to rip her off I wouldn't bale her out financially in the future.
She will have to take the consequences of her own actions.
If she isn't a confused old lady she has to be treated as an adult.

I say this as someone in her 60s.

I really do understand you wanting to avoid these scenarios, but you can only advise and lead her to legal advice.
I don't like the sound of it and I don't like the sound of her other DIL
I am not surprised that you are concerned and upset

I guess it depends on the value of house and mil assets, whether this is above the iht threshold, how much would be left.
The other dil and son are already getting free rent and potential to rent out their own property plus living in a larger one, free childcare. If the mil is healthy and fit it is mot caring for her. They should be happy with that.
If there is a need to leave to children it should be still 50/50 until /unless she starts needing the care and then you can reassess.

I hate the attitude well they have less so ill leave them more in my will.
Do you think mil even realises you are being tapped up to pay for holidays etc? Maybe sil says they are treating.
Your mil sounds very ungrateful (and selfish) i cant believe you dont get presents for birthdays and xmas.

I went to my nans with DD and the digital photo frame we gave her was gone and any photos of my DD :( . She lives with my uncle and aunt and the photos of their GDs were everywhere. They are trying to make her forget about our side of the family.
Some relatives do just focus on the money ... But then she has lived another 20 years with them which i dont think they expected (in good health)
People will do what you let them get away with.
I completely agree its up to mil what to do with money and assets . But if one child is manipulating them for their sole benefit they should be stopped. As they clearly dont care about the rest of the family and it could continue to escalate. Maybe you wont be welcome in the house to see mil as she might want to spend money on your kids... This is what happens next.

How would your DH feel about getting some legal advice on the situation himself regarding the future ramifications for your MIL. He could then write her a letter saying that he loves her and wants her to do what makes her happy. That he understands that she and SIL are both rational adults and entitled to make their own life choices but she should be aware of the following potential issues, which you sincerely hope will not ever happen to her. Then list off everything the legal advisor has told you could be a problem.

Then say that you will not be able to accept any money from her at this stage, but you would advise her to invest that money wisely instead as you will not be in a position to help her financially in any way in the future, whether she needs money for a holiday, home repairs or long-term elderly care.

Send it registered post so that you know she's received it. She won't listen to your DH but I bet curiosity will make her read the letter in full. She will probably be very angry, but it might make her think a bit and hopefully put some safeguards in place for her future.

I understand how very hurtful it is that she is favouring her DD over your DH, but you need to try and put that aside for the moment and guard yourself against a future where your SIL drains every penny and leaves you to pick up the pieces. Try not to think of it as your DH's share going to SIL. It's not your DH's money at the moment, and potentially it never would be if your MIL needs future care.

If you do accept the money, then I would put it into an investment or a high interest bank account and use it only for financial requests from your MIL. Tell her you will do this, and once the money is gone you will not be giving her any more/paying for her care (I know that you almost certainly will, but tell her you won't). Then when she dies you can consider any money that's left as your DH's inheritance.

I re-read your first post. Is your mil actually signing the house over to them or are they buying it. Because if they buy or even if it is gifted and they live in it, then will it not become a marital asset and therefore if they split up your sil will get half. I'd be tempted to go and see a solicitor about this deal. Your DH is being more or less swindled out of his inheritance by your sil. Who isn't even a blood relative from what I understand. The whole thing sounds dreadful.

naty1, TBH, it never occurred to me to think about it before but, truthfully, I have no idea whether MIL knows we are helping to fund her holidays or they are telling her they are treating her. Up until now, it's been the case of - they ask, we help.

And I don't even want to start to talk about Christmas and birthday gifts for us. We only have one child at present, which is her grandson. She would only give him a gift for his birthday if he happens to be visiting her at the time. If we aren't at her house on the day, then he won't get a phone call or a card from her. It's kind of out of sight, out of mind.

Yes, given the fact that she needs no care at present, I do feel she is being thoroughly played by SIL and her DH, who not only need a bigger home for themselves and their kids but also, as someone quite rightly pointed out, some help with their ever expanding brood. So who is going to look after whom is really questionable at the moment.

I'm not going to comment on the fairness of the situation as that has been discussed enough but... If inheritance tax is in question then bear in mind that if an asset is given away but the original owner continues to get the benefit of it then, in most cases, the 7 year time limit for gifts is irrelevant. The asset will still be considered as part of the donor's estate and taxed accordingly. Seven year clock will only start ticking once the donor has no further benefit of the asset. There are a few 'ifs' in the arrangement but most likely, if your MIL gifts the house to SIL and continues to live in it then on MIL's death the house is still counted as part of her estate and taxed to inheritance tax. Therefore legal/tax advice is definitely needed if her total estate is large enough to be affected by IHT.