Dc given quite a lot of ££ by GP, will be richer than us at 18..

[Whereiswarmth]

We are extremely low contact with pils, I certainly would be very happy to never see them again... Dh can't speak to them and has not seen them for a few years now.

Long story! However they do put ££ into dc isa.
It's quite a bit now.. Near 30 grand... Probably a little more, they are 11 and 7.
Obviously this is a first world problem and a nice problem to have but it's worrying at 18 they will have access to this.. They seem very sensible at the moment but I'm aware it could even put them at risk from unsavory people when out socialising..

What will they do with it?

Although I dislike pils obviously I'm grateful for this.. But I'm wondering if they will contribute every year?
Dh and I are not high earners at all.. But something also makes me feel slightly uneasy.. Neither dc have been enraptured with pils.. I'm certainly not going to encourage contact at all after past issues etc. Pils are very well off..

Just wondering if anyone else's dc has more money than them and what they would do with it?

What ISA has an interest rate of 20%? Even S&S ISAs don't see that level of growth year on year.

Id say, step one, keep learning about investing yourselves. Step two, perhaps when they are about 14 or 15, start involving them in decision making about the investments. Then at 18, support them to continue investing.

Meanwhile, ongoing discussions can be had about what this money can help them achieve. So, a bit of time dreaming but also talking about things they will appreciate having money for in the future. Ours don't have the amounts you're talking about, but investment has helped to reach significant sums. Eldest now 18 and being helped to learn practical investing with it. I hope she will get through uni without needing it to be honest, as when she works out what she wants to do with her life it may be really useful to support postgrad study. The younger one needs to learn a bit more about the realities of life and the cost of things, to get him to that point in a couple of years time!

@Squidelicious

Where is it growing at 20%? Do you not mean 2%?

My ISA is running at 18% at the moment, DDs 21% and DSs 26%. They are stocks and shares ISAs and you need to keep an eye on them but 20% is not an unusual figure at the moment.

@Crystal90567

Why cant your children develop a relationship with their grandparents. You dont own them. Just because you dont like the grandparents. You liked their son enough to have children with him so they can't be that bad.

You liked their son enough to have children with him so they can't be that bad

People say this all the time and it’s such a stupid thing to say.

I’m a good person yet my parents were violent and abusive, they were utterly heinous individuals. The OP’s DH being a decent person doesn’t prevent his parents being horrid.

@JustLyra yes you’re quite right.

People sound as if they haven’t a clue when they say things like that.

• yes, stocks and shares isa.. At the start of the pandemic it plunged but picked up very quickly and is going strong! I've just checked and right now my stocks and shares isa is 31% and theirs is 28%.

We have broad investments taking in multi sectors, types, parts of the world etc..

• Crystal, its really sad re pils but I can't be too outing as this I feel is already fairly unusual and outing post but pils impacted on dh emotional health and mine so I would say at the moment.. Protective rather than controlling. Dh is everything they are not.. And that's why I like him and why he suffers with them as he has different values and interests. Dc have had opportunity to get to build relations and its not gone anywhere.. They never seemed keen yo return. Sometimes.. People are awful parents can be different with gc but it has seemed that they are the same.. So it's best to have very low contact.

It's very sad and I would much much rather have warm loving kind gp in their lives than this money to be honest.

I guess it could potentially be a chance of getting on the property ladder or buying their first car - or both!

• some great advice and ideas on here, thank you! Definitely a good idea to teach budgeting and saving and investments etc..

When older house costs versus renting..

Why cant your children develop a relationship with their grandparents. You dont own them.
Just because you dont like the grandparents.
You liked their son enough to have children with him so they can't be that bad.

I hope your children cut you off from your grandchildren too. You seem pushy too. And very controlling.

@Crystal90567 you know absolutely fuck all about why the OP’s husband is NC with his parents. If they were emotionally abusive or physically abusive would you still say they’re ‘not that bad’?

Stop trying to make up a reason to have a pop at the OP.

At 18 they could use that money for uni, for driving lessons and a car, to start a business or even a first deposit. I think you should be grateful. I didn’t receive any money from my grandparents as they didn’t have any. Some people are really lucky.

The most important thing you can do is teach them about money now.
How they deal with a lump sum depends on that.
Financial awareness and budgeting, how and where to invest.
We put money away for our DC from day one. Our own parents had none.
When making wills originally we set up trusts so they wouldn't get it at 18 if we both died.
By the time they were late teens they were fully responsible for managing the investments and we gave them a lump sum to keep towards housing deposit.
They both took full student loans.
One bought a house at 24 and has stocks and shares for longer term, the other has all the money and more set aside to do the same.

Keeping your children away from their gps may mean they resent that later. I imagine the gps are investing for your children as they want to show they care and are unable to see them.

@Squidelicious

Where is it growing at 20%? Do you not mean 2%?

Stocks and shares ISAs over the past year have grown at 18-21% if in mid/high risk managed funds so I assume that may be the case.

You have plenty of time to teach them a responsible attitude to money.
Whether or not PIL contribute on an ongoing basis, it should be a great start to assist with university/house deposit.

I would start talking to them about it when they are 12 (and still impressionable). Call a family meeting, sit at a table and be very business like.

Tell them they are very privileged to have this money in the bank waiting for them and it is a serious matter. That it’s purpose is to be used for a house deposit (ie investment) and should not be accessed for any spending purposes. Show them how compounding interest works and why if you save a pound when you are 20 it is the same as saving 10,000pounds when you are 50 (I made that number up, but you can google it and it is a massive difference). Talk to them about peer pressure and how it can make people spend money in ways that they dont really want to...latest shoes, oh come down to the pub and buy us all drinks as you are loaded.... That good friends and family members can apply even more pressure and it still should be regarded with a critical eye

Print out a 1 page document that simply says

I acknowledge that I have an ISA in my name and I agree to use the money for its intended purpose, which is to be invested in a house/flat when I am ready to buy one.

Have them sign it and date it. Repeat every year on their birthdays

If you want to really go to town add that they will agree to sign a prenup before getting married.

The paper isnt worth anything legally, but it really hammers home the seriousness of using the money for investments only

Then tell them that the money is a private matter and only to be discussed with their parents

This is roughly what very wealth parents are advised to do with their dc.

I'm going to go against some other posters, and encourage them to use it for uni fees (if they want to go to uni).

Student loans do not have to be paid back until you are earning a certain amount of money, but they do attract quite a high level of interest. In the current low interest environment I would say that paying fees upfront is a sensible financial decision (unless they are unlikely to ever earn the level at which you have to start repaying the loan).

My in laws, whom I liked, set up grandchildren’s trusts but was so convinced that they would be irresponsible he set it so that they only got the proceeds when the youngest grandchild was 26. They have all turned out devastatingly sensible but my daughter, who is the eldest, can’t have anything until she is 32. As she is currently buying her first flat it would have been helpful to have some a little earlier. She doesn’t mind and has saved her deposit without help from anyone but just don’t assume they will be irresponsible at 18.
Out of all 10 grandchildren none have been spendthrifts at 18.

Do you not talk to your children about money?
Now is the time to ensure they understand the importance of saving. Start making them save half their birthday or Christmas money, talk to them about the cost of things. Saving up for something they want.

Yes the temptation will be there for them to blow a bit at 18 but that’s ok, encourage them to spend a bit on something they really want and then save the rest for house deposit etc.
And no definitely not waste it on uni fees but some would definitely need to be used for living expenses

18 is young to have access to large sums, your worry is they waste it.
My DD has a trust set up by her DF but cannot access until she is 23,as he felt 18 was too young and she might be too frivolous.

Its wonderful for them to have a safety net.
18 year olds are much more sensible than we think and if you talk to them in general about saving and what one should spend it on, then if they have a little splurge on a holiday for eg, but are prudent with the rest what the harm.
Your PILs have been generous, but I doubt they can control an 18 year old. They also might relate differently to the GCs than to you (apologies but I have noticed this is the case for a few of my friends)
They are still so young, I'd ease up on mentioning it to them and trust them to be sensible because you've set a good example.

Sea to ski

That's an excellent idea thank you, I like the idea of signing something.
To be honest both dc seem at total odds, one is happy to wait and save for pleasure then eek it out the other gets money for games or choclate and spends/eats immediately!

I've heard some horror stories of dodgy people in social circles singling out those with money and targeting them to get hooked on hard drugs I'll just have to be really careful with them and drum all this in.

Re paying uni fees v loan.. I didn't realise that loans had % on them to be paid back.. So there is a risk that they couid go high.

I don't think it has to be all nor nothing.. Pehrps some for keeping uni costs down, some for deposit, car etc.

I think it might be easier that its a large sum. £1-2k could be easily spent, but when its a significant sum, you can "ear mark" it for them.

I would start now telling them that granny and grandad have set up a special savings account for them each for a house deposit when they are adults. Refer to it like that. Isnt it nice that they have put some money aside for you, to help you buy a house when you are a grown up. Mummy and daddy had to miss out on lots of treats to get their deposit money saved, your grandparents have done that for you. Always refer to it as the future house deposit money.

Later, you can introduce the idea if there was something else they wanted "to set them up as adults" to spend the money on - like investing in opening their own business, or paying the fees if they wanted to study a course they couldn't get funding for - the "deposit money" could be used for that, but keep the idea its for something like a house deposit or investment in their future, not living expenses.

Would it be worth splitting the amount they're saving in the isas?

I'd leave half in the isas for deposit/travelling and put the other half in a stakeholder stocks and shares pension. Any amount invested before 18, worth more than after in interest. They won't be able to access before they're 55(?) but hopefully the compound interest will give a boost just when they can make use of it.

@Newgirls

That will just about cover uni so yes a lot but not silly money.

Be happy you won’t need to pay for that!

I wouldn't spent it on university, the loans are cheaper than a mortgage so I'd take the loans and then use the 30k or whatever for a house deposit.

Your children are very lucky to have this set aside for them. My PILs are wealthy too..but have never given our children a penny. MIL still insists on choosing them clothes for Xmas that they never ever wear...even our eldest who is 21. She expects great deference and gratitude in return. Your PIL's sound remarkably generous!

I think it is wonderful. It may seem like an enormous amount but banks aren't paying much interest right now so may not be much more by the time each reaches 18.

It will give your children a leg up and allow them some comforts.

Think positively about this money.