To use my child's money?

[henparty]

Just looking for opinions on this. We are about to move house, buying a much nicer house in a better area. We can afford the repayments but are maxing ourselves with the move (trying to put as much deposit in as we can to get a better interest rate plus stamp duty, legal fees etc). We are using up every penny of savings but a year from now should be fine. When looking at the very stretched figures yesterday DH suggested we use our DDs savings. She was gifted £5000 by her grandmother before she died but the money is in an account in my name. DH said we could put the money back in within a year and pointed out that as DD is our only child (we cant have more) she will inherit the house one day anyway. AIBU to worry that it is wrong to borrow from your child?

[Floralnomad]

I think it's a totally different situation dipping into your child's savings to pay rent / for groceries than using them to buy a house / car / holiday , in the first instance it's a genuine need .

[AugustaFinkNottle]

I wouldn't use it. You are trustee of that money, and there is no such thing as a 100% guarantee that you will repay it. Suppose, for instance, you were both involved in a serious accident tomorrow and could never work again.

[Oysterbabe]

Aren't there rules about looking after money left to a child? I'm sure there was something on judge Rinder about it the other day

[Idliketobeabutterfly]

You've also answered the question in the thread title... It's Her money

[n0ne]

I've done this. DF had a savings account for DD, the balance of which passed to me when he died. I put the approx £1k in a separate savings acc for her which I add to to monthly, but if I'm in dire straits, I dip into it (but if I have extra money at the end of the month, I put it back). Right now it's down to £200ish. I will make sure she gets all her money plus interest back in the long run, but right now we need it. I feel slightly guilty but the money's benefitting all of us right now.

[whois]

I would borrow it but put back with interest. Higher interest than a bank savings (so like 3%) but less than if you had borrowed more debt.

[paxillin]

Think worst case. One of you could die, acrimonious divorce, one goes on to have more kids or step children... there are lots of ways she could find herself no longer in the role of a well protected only child. Not only should you not touch it, put it in an account in her name to make it accessible to her alone.

Look in relationship for tales of how bad it can get out of the blue. All unlikely, but not unheard off.

[NickyEds]

Oh fgs I hardy think there's going to be an acrimonious divorce and step children in the next year is there? Use the money, it's in your name so I suppose technically it is yours but ear marked for your dd and stinks a bit of an inheritance tax avoidance measure.

Our kids don't have an inheritance but if they did and I needed it I'd happily borrow it and pay it back. I fairly often raid their money boxes because there isn't a cash point in the village but that's money we've put in mainly. I devote my life to those kids, I owe them nothing

[ThroughThickAndThin01]

I would use it.

I'd pay it back in a year.

If it wasn't possible to pay it back in a year, I'd then set up a direct debit for it to be paid back monthly until the £5000 was back in an account in her name, this time.

[paxillin]

It happens. Countless tales of "if only granny had...". Nobody thinks it'll happen to them.

[yomellamoHelly]

Use it. Make arrangements to pay back in installments. Keep a tally of how much interest you owe and pay that too.

[CloneMeNow]

I will dissent and say I think it's wrong. If you use her money to help buy the house, then it should be done legally so that she owns that proportion of the house.

If you do it and pay it back, it must be with interest to compensate for the interest that she has missed. And, it ought to be with a higher rate of interest to compensate for the risk - because there is a risk.

I feel a higher responsibility to money for my children than to my own, and I wouldn't dream of borrowing it tbh.

[LittleLionMansMummy]

Agree with Nicky. Ds wants for nothing and will have a tidy little nest egg from the years of me paying monthly into a trust fund for him. If I was fairly sure of my maths that i'd be able to pay it back I'd be more inclined to invest it in a house than dipping into it for food shopping or bills which essentially fritters it away for no return.

[paxillin]

That's a good idea, CloneMeNow. She owns a bit of the house as insurance.

Otherwise, if hunger or homelessness is the alternative, go ahead, for buying a house you can't afford, no.

[Skittlesss]

I don't agree with using it at all. It's not like situations others have described - where you are desperate and have no other choice.

Buying a house is expensive but if you can't afford it without using your child's inheritance then you need to reevaluate what you want in a house. Although you plan on paying the money back within a year then perhaps you should just save a little longer?

[Theoretician]

this is the very reason if children are left money it should be put into a trust so greedy adults cant spend it

If the money was given to the parent for the child, that is a bare trust, I think. Therefore:-

Use the money, it's in your name so I suppose technically it is yours but ear marked for your dd

is simply wrong. The money being in a bank account in your name does not mean it belongs to you.

If I ask you to hold my wallet/purse/handbag while I go somewhere, the fact that it is temporarily in your possession does not make you the owner of its contents.

[TickleMyTeacakes]

I'd use it and would think twice about it!

[TickleMyTeacakes]

sorry, 'wouldn't' think twice about it.

[TickleMyTeacakes]

sorry, 'wouldn't' think twice about it.

[ijustwannadance]

I have used my DD's money in the past.
DP and I put in x amount per month into an account since she was born. Any money she received as a baby/toddler also went in.
We had an unexpected expense of around £700 at a time we were struggling. Our options were loan, cc or DD's money.
Why would we choose the options with ridiculous interest when already spread thin cash wise?
We just increased our standing order each month back into her account until paid back.
Would do it again if necessary.

[henparty]

Thanks for all your replies. Just to clarify, DD is very young and not aware of the money. There was no question of us taking the money to put into the house and not paying her back. We could definitely repay it in a short period of time. We are not actually getting in too far over our heads with the house, although it might seem that way. We are only borrowing 2.5 times our salaries. We are stretching ourselves to put down a large deposit as we don't have much equity in our current house. We don't have to do this and might not when it comes down to it. This is where DH's suggestion of borrowing the money from DD came up. Some people have made the good point that she might not in fact inherit the house some day, given unforeseen things that can happen and that is good to bear in mind. I think what DH meant by this is that its good for her both now and in the future if we do manage to buy this much better house so if we had to borrow some of her money to get through the very lean couple of months close to moving time then that could be justified.

[henparty]

Also someone mentioned inheritance tax avoidance, there wouldn't be any inheritance tax on such a small amount of money so that never had anything to do with it.

[AdrenalineFudge]

I genuinely don't know why parents tie themselves in knots over this type of thing, you'd be forgiven for thinking it was some sort of professional business transaction. Of course I'd use it and not give it a second thought.

[TickleMyTeacakes]

It makes perfect sense to me henparty.

[Pantah630]

Personally I wouldn't do it, even with money I've saved for my own DSs, once it's theirs, it's theirs. Not my piggybank to borrow from as I feel like. You never know what is around the corner, meaning you may not be able to pay it back, despite good intentions. It's your call though, not mine thankfully.