To use my son's savings to pay off debt?

[Bibs2014]

What would you do?

We are £17,000 in debt due to failed IVF .

DS has £1200 in the bank (not including interest) as I started saving £100 a month for him last year in a high interest account that I couldn't touch for a year.

It's now matured. Should I take the money out and clear some of the debt? It's all on 0% credit card and is manageable (at the moment).

The reason I'm thinking we should is because we want to move house so it looks better to have less debt.

Reason against is that even though I could save the money up again in the future, you never really do, do you? I already started late as I wanted to start saving from his birth and didn't start till he was 16 months so I already 'owe' him £1600 😂

So your ds is not yet 3? Use it to reduce the debt.

I would use the money as once the debt is paid off you can repay him.

Reduce the debt. Those who say 'oh it'll hardly make a dent in the total, why bother' - how else are you going to pay back debt except in small amounts?!

Needs must. I'd "borrow" it with a hope to replacing as and when. We live in hard (financial) times. If you were saying you wanted to blow the cash on holidays and fine wine, then obviously, no.

"The only way to clear a debt is to chip away at it until you get it down. To all the people saying £1200 won't make much difference, they are wrong. Every £1 paid off, is one closer to being debt free. Op, you never had £100 to save for your son, this is your money and spend it on getting rid of your debt. I'm very sorry your IVF didn't work."

Agree with every word that PippaFawcett says.

OP

I know what you mean that it's his money.
But you need to clear the debt. An adult thing.

And you can't afford to save £100 pm so use it to clear your debt, then set aside a more realistic amount for your son in the future.

Sorry about the ivf.

It probably sounds like a heartless thing to say, but the £17k would have been spent whatever the outcome, wouldn't it?
I don't think raiding your child's piggy bank at this point is really on.

I don't think thats on at all. How would you have afforded a 2nd child if the IVF was successful, would you have pinched his pennies then?

I can't imagine a lender or landlord looking more kindly on a £15,800 debt compared to a debt of £17,000.

Agree with at least one other PP about keeping the money as a 'rainy day' stash and forget saving £100 a month for your son and instead use the £100 to pay off the debt and maybe save more than the £100 per month - you could have the debt cleared in two years time.

Even if the IVF had worked (and I am sorry it didnt) then you would still be in debt so I think you need to stop connecting the two.

Take the £100 a month, and the £1200 and throw it all at the debt. Every time you want to get a chippy tea, cook something and stick a tenner in a pot and at the end of the month pay that off it too. Every time you want to treat yourself to a magazine or a coffee, dont buy and pay that to the debt. When you look at where your money goes on things you dont really need and wont miss, and what you could pay off in a year by doing that you easily cut it by a quarter by this time next year.

If it's money you have given him yourself, then yes, I would use it.
If (worst case scenario) you had to downsize, for example to clear off your debt, would that affect him more than money he never knew he had?
I would have to prioritise a short term solution over a long term plan in this case, sorry.
Once you've cleared the debt, then look at building his savings up again.

Yes use his cash. Debts first.

Once out of debt you can save for him. If your really determined to give him 20k, you can just put more aside each month once your ready. £115 instead of £100

Yes it's a case of every penny counts

It would be like giving someone a gift and taking it back

Well if I gave my 1 year old a gift of a thousand pounds of my money and then I needed a thousand pounds so we could live a normal life, of course I'd take it back.

All this talk of raiding the piggy bank is ridiculous given the OP's situation - she is heavily in debt and yet is putting money she actually doesn't have aside for her infant child who really doesn't need it.

And just so everyone knows, if my family were in dire straits (and many would consider 17k in debt dire straits) damn right I'd raid the piggy banks. When things were tough (and that wasn't even very tough - going without food tough) many years ago, my mother had us take money out of our savings accounts to pay for our school shoes.

I don't think thats on at all. How would you have afforded a 2nd child if the IVF was successful, would you have pinched his pennies then?

What pennies??? This child doesn't have any pennies. His mother has pennies which she set aside for him but unfortunately a 17k debt calls.

And yes a landlord or lender looking at the OP would think a 15 something debt better than a 17k debt and would be impressed with her paying off 1600

I would use the money to reduce the debt. I'd use the £100 going forward to reduce the debt. You cannot afford the luxury of saving £100 a month for your son as nice as it is to save for his future. He'll benefit more from you being debt free than £20k when he's 18. You can start saving for him when you can afford to.

I'd also take a long hard look at your finances and cut out non essential spending like takeaways, magazines, random coffees. It's surprising how much that adds up over a month.

When 0 per cent ends take out a homeowner loan for 5 years with your mortgage provider. Interest rate will not be higher than 2-3 percent and still be far cheaper than a loan.

Yes I would, I wouldn't be saving for anything until I cleared my debts

Agree with every word that PippaFawcett says
Me too. Pay it off by chipping away at it.

OP . It's easy for me to sit here and say "I couldn't" but I'm not facing your situation. The other thing you need to consider is, if it's in his own ISA you won't be able to get it back out anyway. It doesn't seem as though it is (?) and like others have said, every £1 paid off is £1 less to pay. You don't pay a £17,000 debt of in a single £17,000 lump-sum. You pay it off in bits and pieces, and £1,200 is a fairly sizable "bit". When your finances are sorted, you can go back to saving for your DS then.

Think of it this way. If you use that money and then pay off your debt you will be in the position to save so much more as you will no longer be servicing the credit cards.

Its not as if you would be literally raiding his savings, you are raiding your savings that you have earmarked to give to him when he is older. You will still be able to give him that money when he is older, so does it really matter in what order you actually saved it?!

I can only assume that the ones talking of piggy bank raiding have never genuinely, properly had money worries.

Yes use it to start clearing the debt and continue paying the £100 a month towards the debt as well. At the end of the 0% period switch to another 0% card if possible. But I would forget about moving house. You can't afford it. Plough all spare money into clearing that debt. Make out and actual plan with a finish date and how much you are going to pay each month. Reassess every month to see if you can pay more.

Sorry to hear about the IVF

If it puts you in a better position when moving, then using the 1200 for that will benefit your DC way more than anything they might chose to spend it on at 16yrs IMO

The "value" of that money giving the child a decent home to grow up in is way more than any interest it could generate sat there

I wouldn't, it's not your money if in an account in his name.

Instead maybe focus on what you can actually afford rather than what you want.