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AIBU?

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Original poster

Large financial gift to one adult child

420 replies

Betty52 · 03/02/2020 22:05

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)

OP posts:
DarnTooting · 03/02/2020 23:36

This is an awful idea for so many reasons. I'm a DC1 in a similar scenario and it really hurts and upsets me that my sister can afford to work only 20 hours per week in a low stress job whereas I can't. My husband and I both worked really hard to save for a wedding, house and children. She's been bailed out of debts more times than I can count (with nothing to show for it!) and was gifted 50% of a property to get them out of a 1 bed rented flat with a baby who was planned. My parents are massive enablers and it's ruined their relationship with my children. I'm very bitter and do hold a grudge against my sister - once my parents finally die I can't see us spending any time together moving forwards. Such a shame as we used to be so close.

Blondeshavemorefun · 03/02/2020 23:38

Split evenually

Dc1 worked hard and got a large mortgage - why should they be penalised for this

Sure £60k would help both out - large deposit v chunk paid off mortgage /building work

Where as dc 2 didn’t have to have 2 dc in a small flat

Why should they have more now

Who know what will happen in the future via money

And yes who are you in this scenario

Dc 1 2 or parents

C8H10N4O2 · 03/02/2020 23:39

Most obvious one is dc1 becomes in need of support e.g their spouse dies, a child becomes disabled and they become a carer or a million and one other things

If DC1 is in the comfortable position described they are also in the position tonegative events could also apply to DC2.

I've never subscribed to the absolutism of shares often prescribed here. DC have differing needs and none of us have "rights" to our parents' money.

I'm also a "DC1" in this situation, I'm glad my parents helped my youngest sibling. It may or may not diminish my final inheritance, frankly I'd rather my DM enjoyed what she has whilst she can than saved it for us. The differences in our financial successes as siblings has more to do with luck and market forces than willingness to work hard and be "deserving".

As a parent, I would also help my DC as they needed rather than rigid equal shares. Equal does not automtically map onto fair unless you subscribe to some variation on Prosperity Theology.

Daftodil · 03/02/2020 23:39

DP's money, so they can do what they like with it...

But... you say DC2 didn't intend to have children and had to buy previous partner out of the flat. What if DC1's relationship breaks down or s/he loses his/her job or suffers ill health. There are lots of financial considerations that people "don't intend" to happen, but life sometimes has its own plan. How will DC1 feel if s/he falls on hard times in the future and can't access the same financial buffer - will it cause resentment between the two children because of it?

Fruitbatdancer · 03/02/2020 23:40

The only people who think this would be ok are:

  1. DC2
  2. parents who favour DC2 over DC1

I’ve seen so many families never speak again after this kind of thing. YABU.

ColumbaPalumbus · 03/02/2020 23:40

Is DC2 married? I'd want the gift protected in some sort of way in a trust or whatever in case of a breakdown in the relationship which sounds like that's already happened once. DC1 might swallow watching the money go to DC2 but to watch half of that walk away with their partner maybe not! You need to consult with a solicitor. I'd also give DC1 something even if it's 10-20k to help with renovations costs.

AnybodyWantAChip · 03/02/2020 23:41

You should treat your DC the same, or it could cause a lot of problems in the future.

RichPetunia · 03/02/2020 23:43

Personally, I wouldn't be happy. Same money to both or none at all.

theoriginalmadambee · 03/02/2020 23:56

Gift an equal amount to both your children now

This is the best solution, if you want to help your dc.

I think your current solution to give to one dc only, is the perfect way of breaking up your family. (You are actively punishing the dc who have planned and done well).

AnneLovesGilbert · 03/02/2020 23:57

You are actively punishing the dc who have planned and done well

I’m afraid it could well look like a lot like that.

SonjaMorgan · 03/02/2020 23:58

The DP can do as they please, it is their money. I doubt I will get any inheritance from my DPs, and even if I did I would want to pass it onto my DCs as I would not need it at that point.

BedStuy · 04/02/2020 00:02

It's an absolutely life-changing amount of money, OP. I don't think there's necessarily an issue with giving one DC a bit more but you are talking lottery win amounts here. With the best will in the world I'd find it hard to think well of this if i was DC1.

MiniGuinness · 04/02/2020 00:05

My mum did this, however she just “guessed” each individual situation. So it was far from fair.

BedStuy · 04/02/2020 00:10

Good point. How much of the ins and outs of costs, sacrifices, and financial situation etc do the DP actually know for fact, and how would you even begin to go about quantifying who should have what?

AJ1425 · 04/02/2020 00:12

Yeah, sorry, very unreasonable. Your first child has made sensible choices, your second child hasnt. I've been in that situation as the one who made sensible choices and it's not nice. Even worse when theres no inheritance left cos you dont actually know what is going to happen in the future and cant guarantee there'll be anything left.
Lovely way to show which child you prefer and put an nice big division between them so thumbs up for that!

timeisnotaline · 04/02/2020 00:19

It doesn’t sound like dc2 is particularly feckless or into wild partying. Different jobs pay different amounts and we can’t all earn 6 figures, it’s not a measure of human worth or contribution to society. I would. My parents are providing support for one of my brothers owning a home. The other siblings are fine. I have a home and a good income. Why would I not understand my parents want to know he has a place of his own? I wouldn’t write it legally against inheritance either, anything can happen in the intervening years.

HeronLanyon · 04/02/2020 00:27

I agree with pp that fair does not always mean equal.
I also agree that dcs need help at different stages for different reasons.
BUT. I’d really urge the dps not to do this for all of the reasons above. Recipe for various kinds of disaster however sensible it seems now. Just been my mums executor and have had to deal with far more minor sibling ‘todos’ about ‘unfairnesses going back decades. Unexpected and upsetting and a pita.giod luck dc2

pallisers · 04/02/2020 00:29

As pp have said, in this case DC1 may never receive any inheritance as the parents may need the money.

Absent, special needs/disability/really difficult life circumstances, I don't think it ever works to give one child a leg up that the other isn't getting.

I have 3 children and while I would love to leave them money eventually the best legacy I hope to give them is their relationship with each other. Don't jeopardise that - that will last long after you are gone.

In the circumstances the OP describes I would give a smaller sum to the dc2 to give them a boost but certainly not 120k. Dc1 WILL feel "hang on a second my partner can't reduce hours to facilitate our children's whatever because we have to service this mortgage - yeah our choice - but my sibling can live their lives as they want because my parents have effectively bought them a house'

This won't end well.

TheTeenageYears · 04/02/2020 00:32

Agree with many of the comments already made OP about DC1 ever receiving money as you have no idea what the future holds.

A couple of additional points would be that you should probably set aside the tax element of the gift now so that the 7 year rule is covered no matter what and as a slightly different idea is it possible to gift the money equally to DC’s but have DC1 loan DC2 their half? The loan could be drawn up as a proper legal loan and interest rate and repayments terms set. The terms can be very different from standard repayment mortgage type and could include provisions if DC2 and partner split up or they make choices which would adversely affect DC1.

It’s not just about treating DC1 and 2 equally, it’s about treating GC’s equally as well. If you go ahead with the current idea and DC1 ends up with nothing because all your money dries up their DC also end up with nothing unlike DC2’s DC.

stellabelle · 04/02/2020 01:03

I wouldn't - it's not fair. DC1 could die before you, or you could live another 40 years and spend it all on care home fees. Giving a large amount to one AC as an "advance on inheritance" just brushes over the fact that you are favouring DC2.

If I was your DC1 I'd be very upset to think that you'd virtually buy my sibling a house and leave me with the explanation "oh but you'll get more when I die " .

PyongyangKipperbang · 04/02/2020 01:08

I would but I would get it done legally as a loan to be paid of either during your life time or via inheritance.

Personally I would ask them to pay back at least a token amount per month, say £100, so that the other child doesnt feel that their sibling is getting a free ride when they could presumably have done with a hand up when they were saving their deposit etc.

IdblowJonSnow · 04/02/2020 01:49

Yanbu but only on the basis that everyone knows and is ok with it.

LovePoppy · 04/02/2020 01:55

What I’ve seen other families do is have for child receiving aN “advance”, is pay back standard interest on what the money would have made. That way the Estate is still growing by what it would have done

whatcanyoumean · 04/02/2020 02:21

This happened in my family,

child 1 - bad split from partner and managed eventually at 40+ to get a mortgage on a modest house for herself and her child. Worked 2 jobs for 10 years to get to this point.

child 2 - did two different (unrelated) degrees, didn't work at all during this time, messed about with various jobs as a 'musician' and had 3 children. Got her first 'proper' job at 41(part time, naturally).

child 3 - went to uni, got a good job, worked solidly ever since, managed to support herself through a divorce and has a big mortgage on a decent house for herself and her child. Worked full time the last 20+ years.

Our parents decided that as child 1 & 3 had a house they would give child 2 approx 150k to help her and her (high earning) partner to buy a house. This was deemed fair as it will be 'reflected in their will'
Except they are now late 70's, neither has changed their will from 'everything left to all 3'.

While I can sometimes see their logic, I also see that rather than her and her partner buy a house within their means (which they could easily have done) my parents gave them 150k so they could buy a 'dream house'.
150k would have made a real difference to child 1 and child 3. Even half or a third of it would dramatically change their lives really. Both have been single parents for the last 10+ years, both have done everything for themselves.

As I said our parents are now late 70's, its not mine or my sisters place to ask them about their will. They've made their decision and that's entirely up to them. It definitely stings though. Sure we have houses (and mortgages) but its been a lot of hard work to get there and definitely a struggle every month with no support from a partner. Doesn't help that child 2 has always been the golden child and seems to just take all the help she gets for granted.

PyongyangKipperbang · 04/02/2020 02:29

Although on re reading the OP I am wondering why the child changed their mind on having kids without making sure they could adequately house them.......