Large financial gift to one adult child

[Betty52]

Is it unreasonable to make a significant financial gift to one (adult) child but not the other in these circumstances?

Two parents (DPs), in their late 60s, have two adult children (DC1 and DC2) in their late 30s/early 40s. Both DCs are married/long term partner and each have two of their own children. DC1s household income is roughly 3 times that of DC2s. DC1 has a decent family home in a pleasant area of an expensive part of the country. They’re in the process of doing major building work and have re-mortgaged to retirement for that but they’ve built up a lot of equity because of the location and work they’ve done. Their children are pre-teen and settled in school so they have no reason to move. DC2 has a 2-bed flat in an OK area in a cheap part of the country. There is very little equity due to prices not rising much in this part of the country and having had to buy a previous partner out of the flat. They hadn't intended to have children but changed their minds and now have two pre-schoolers in a flat that’s too small. They would like to move to have more bedrooms/a garden/near better schools but can’t afford it without help.

So would it be unreasonable to gift DC2 and partner the c£100-120K needed to buy a family home in a nicer part of town? This would be an ‘advance on inheritance’ so DC1 would get the same amount in DPs will (with the remainder split equally). DPs both in good health (and still have two of their own parents) so want to enjoy life now and be able to plan for what might be quite a long future. For this reason, DPs can’t afford to give both DCs this amount now and giving half to each wouldn’t give DC2 enough to move to the house/area that they want.

So is it unreasonable to give DC2 that large gift now and make it up to DC1 in the will? (YABU = it is unreasonable, YANBU = it is not unreasonable)

We have had a similar but reverse situation in that DPs insist on making the gifts equal at the same time because they are concerned about the inheritance implications (eg having to re-write wills to ring fence X for DC1, what would happen if there was no inheritance after care home fees etc). DC1 would actually have no issue with it not being equal at the moment but conceded that it is easier to 'true it up' now rather than have to deal with it in however many years time.

I would be happy for my sister to get a leg up if she needed it and I didn’t .

But speak to a solicitor and see if there is anything you can do to protect the money in the even your child divorces.

You could wind up watching your ex son or daughter in law walk off with a lot of your savings (happened to friends of my parents).

I can honestly see this causing a lot of resentment. DC1 is mortgaged until retirementbage, so could really benefit from that sum too. Gifting one child £100k+ because they made a choice to overcrowd their accommodation seems quite enabling to me, rather than a helping hand on to the property ladder.

Who are you in this scenario Op?

My family are in a very similar situation, I am Dc1 in your example. My parents 'loaned' my brother 50k about 5 years ago. At the time it was decided that this would come out of his share of any inheritance. My parents finally got round to making their will recently and have decided to forget about this loan and we will both inherit equal amounts.
On the one hand, yes it is a bit unfair that we have not been treated equally, on the other hand, it's my parents money and they can do what they want with it. My brother and his family are still not in a great position financially whereas me and my family are better off. I understand that my parents wanted to help him out when he needed it so I don't begrudge him the money.

I think it's fine. I wouldn't grudge this for my sibling if I was in this situation.

Has DC2 asked for help?

Neither my mother or my MIL's plans for us re: inheritance have panned out. Every penny of their savings and their properties (two properties in my mum's case) has gone on care.
It's ridiculous to plan for things to be evened up in the will.

No, its a bad plan and will lead to resentment.

We all make choices and live with the consequences. Why did dc2 have 2 children in a small flat. No one forced her?

So many assumptions on this thread. You don't know if the child with less doesn't work hard...

I think it would be fine if you talked to DC1 first to assess their feelings about it. You never know they might be in massive debt/about to divorce or whatever.

I'd say no, there are lots of reasons and what ifs to why this isn't fair.
If I was DC1 I wouldn't be happy about DC2 getting the money about 30 years before me. £120k now won't be the same as £120k in 30 years time

Are you DC2?

I wouldnt, unless there's a backstory like DC2 is disabled or was in an abusive relationship or something very difficult.
See this all the time.
The DC's that 'need the extra help' 9 times out of 10 only need any help due to their own lifestyle choices, so it is a massive kick in the teeth to the other sibling(s) who have worked hard to get into a stable position. The DC who receives the help never actually makes any real effort to improving on their own, and their siblings are hurt and resentful that the DC is being rewarded for wrong choices and further enabled to not bothering to put the effort in.

I think this is a really terrible idea and has the potential to alientate DC1 from their parents, and also potentially cause lifelong damage to the relationships between the two siblings after the parents death.

It should be 60k each or not at all, DC2 could have had one child, could have decided earlier they wanted a child and done something about it etc etc

Absolutely not. Why not split the money equally?

There may be no money left by the time the will is being distributed so I’d say don’t do it.

If parents have spare money kicking about just now they want to gift, should split it equally between both children, either now or in the will. Up to both kids what they do with it.
And keep in mind any large financial gifts made by someone within seven years of death can get taxed retrospectively or something if the gifter dies.

I think it's unfair. I think you need to seriously consider if you can afford that amount as a gift that you give half each.
Just because DC1 has worked hard for what they have it still sounds like they would appreciate some help from family.
They obviously haven't asked for it but I think if it was me I'd be gutted that my parents hadn't actually considered me in the situation.
£60k is an amazing deposit. I find it sad that you think it's ok that your DC1 is mortgaged to retirement to improve their home but you would hand so much money to DC2 so they can have a small mortgage in a nicer area.
If I was DC1 this would really hurt me.

I have two young sons and I can’t imagine giving one a large monetary sum without doing it for the other regardless of their income.

I wouldn't, asking dc1 puts pressure on to say yes, but long term it would probably upset them.

I would not do this.

My DH and I would be DC1 in this scenario.

I genuinely wouldn’t mind this. It would be nice to have the discussion first but there is an obvious disparity, I don’t need it and they really do.

Have a chat with your better off DC to sound them out.

I know of a friend whose brother is utterly adamant that everything be 100% equal regardless of circumstances and he’s a douche.

I suspect DC2 has been at least hinting, if not outright asking! I know a similar scenario, a family complaining about being squashed in their accommodation even though they knew where they lived before having children.

It does penalise DC1 for their success or planning IMO, and that's not fair.

Involve both children in the decision making. That way, both are more likely to feel happy with the outcome.

So many assumptions on this thread. You don't know if the child with less doesn't work hard...

Quite.