To be concerned about my parents early inheritance

[SallyA1976]

Hi All - 8 years ago, I received my inheritance from my parents of about 200k as a gift which enabled myself and my husband to buy a house. This was early (my parents are alive) and given to me to avoid inheritance tax and in a period where I needed it the most. The mortgage was agreed on my high salary at the time plus this deposit from my parents. My husband is on a substantially lower income with no ambition to increase it (he is not driven by money, hates his job - sees no reason to work for money or promotion, etc). We're 10 years married and the cracks are starting to show. I realise that if we did part, I would lose half of my parent's inheritance - yet he would receive his full inheritance in time from his elderly parents when they pass. Nothing I can do about that - I know, however, I am so resentful of it largely as well because of my husband's unwillingness to provide financially for us.

My parents also want to gift us more money now - and my husband is aware of that. AIBU to bring up my concerns? We could use the extra money - I just wish I could ringfence it so in the event of a divorce. It would mostly still come to me.

@SallyA1976

Hi All - 8 years ago, I received my inheritance from my parents of about 200k as a gift which enabled myself and my husband to buy a house. This was early (my parents are alive) and given to me to avoid inheritance tax and in a period where I needed it the most. The mortgage was agreed on my high salary at the time plus this deposit from my parents. My husband is on a substantially lower income with no ambition to increase it (he is not driven by money, hates his job - sees no reason to work for money or promotion, etc). We're 10 years married and the cracks are starting to show. I realise that if we did part, I would lose half of my parent's inheritance - yet he would receive his full inheritance in time from his elderly parents when they pass. Nothing I can do about that - I know, however, I am so resentful of it largely as well because of my husband's unwillingness to provide financially for us.

My parents also want to gift us more money now - and my husband is aware of that. AIBU to bring up my concerns? We could use the extra money - I just wish I could ringfence it so in the event of a divorce. It would mostly still come to me.

Tell your DP to get legal advice and get them to ring fence it just for you. Then just wait to split until he inherits. If his parents are truly elderly it probably won’t be long.

@SkodaKodiaq

I don’t know if anyone else has pointed this out or not, but it’s worth knowing that should your parents ever have serious, expensive care needs in later life and end up burning through all of their money & assets to pay for it and then have to turn to the state to fund it (don’t be thinking this is impossible by the way, as my uncle was a very, very wealthy man who has lost everything to pay for his wife’s dementia care in a care home which is costing over £1k per WEEK. Her Dementia is so advanced that she HAS to be in this place for her own safety. He had a portfolio of properties - all sold to pay for her care and it has got to the stage now, where he’s going to have to sell their beautiful home 😥), then the early inheritance your parents gave to you, could be seen as ‘Deprivation of Assets’, particularly if your parents have ANY current care needs, resulting in them approaching you to find their care. Obviously this is only IF this situation occurs. Fingers crossed it becomes totally irrelevant but I think it’s worth mentioning.

I'm fairly sure that 'deprivation of assets' will only apply if it could be foreseen that someone would need care at the time they made the gift.

@skirk64

Look at this from the other way round, if a man was a high earner and had been given money by his parents to buy a home, if his wife was earning little or nothing and they decided to divorce - everyone would be arguing the wife was entitled to half.

It's the same situation here. You got married, you share things equally. He may or may not get an inheritance in later life - you don't know for sure until the money is in the account.

I'm not that sympathetic - you gamed the system to avoid inheritance tax, now you're upset you can't game the system to cheat your husband out of his fair share.

This in spades.

@SallyA1976 I have NO sympathy with you. You gamed the system to avoid inheritance tax, and are now miffed you will have to share 'your' inheritance with your husband.

There's no shame in disliking work and just wanting to stay on a lower rung of the ladder with no promotions, ever. I know a few people who have not progressed in their workplace for 15-18 years or so, because they CHOSE to not progress.

Several of them are now on a higher salary than the manager, because of their yearly increments over the past 15-18 years or so. £12 to £13 an hour they're on, for a basic, no responsibility job, and the manager is on £11.50 an hour. (Because they have only been there 2 to 4 years.)

And if your husband is a substantially low earner, then why did you even bother marrying him? You must have known you would grow to resent this eventually!

Also, why is it your husband's responsibility to 'provide' for the family? This is 2021, not the 1950s.

Oh, by the way, you haven't got a leg to stand on. If you divorce your husband, he will get half of everything.

Best wait until you're divorced to get the other cash gift your folks are dishing out to you. Then you can spend it ALL on yourself!

You really sound like you dislike and resent your husband. I feel sorry for him to be honest. Do him a favour and cut your losses, and divorce him, so he can be with someone who respects and loves him more.

You owe him that.

@SkodaKodiaq

I don’t know if anyone else has pointed this out or not, but it’s worth knowing that should your parents ever have serious, expensive care needs in later life and end up burning through all of their money & assets to pay for it and then have to turn to the state to fund it (don’t be thinking this is impossible by the way, as my uncle was a very, very wealthy man who has lost everything to pay for his wife’s dementia care in a care home which is costing over £1k per WEEK. Her Dementia is so advanced that she HAS to be in this place for her own safety. He had a portfolio of properties - all sold to pay for her care and it has got to the stage now, where he’s going to have to sell their beautiful home 😥), then the early inheritance your parents gave to you, could be seen as ‘Deprivation of Assets’, particularly if your parents have ANY current care needs, resulting in them approaching you to find their care. Obviously this is only IF this situation occurs. Fingers crossed it becomes totally irrelevant but I think it’s worth mentioning.

This isn't quite true - the uncle here doesn't have to sell his (assumed) 50% of assets to fund his wife's care. Neither can the main home be sold out from under him. Only her assets are taken into consideration. The state will put the aunt in an appropriate place for her needs.

People really should take appropriate advice.

And without intending to hijack this thread - exactly why shouldn't the assets be used to fund someone's care? Its ridiculous to think people can hoard wealth and expect the state to pick up the tab.

One of the key things when 'choosing' a life partner is to ensure your ambitions match. Just as important as the chemistry. That's what I tell my DC anyway!

Personally I know I would have lost respect for someone who didn't do everything they could for the good of our family unit.

Look at this from the other way round, if a man was a high earner and had been given money by his parents to buy a home, if his wife was earning little or nothing and they decided to divorce - everyone would be arguing the wife was entitled to half

I'd normally agree if the woman has given up work or took a lower paid job to look after the dc, but the op hasn't said that. I agree he should have the half the equity and half of any mortgage payments (regardless of who earns what), but I do understand why the op would be resentful of her dh taking half the inheritance. I'm sure her parents will be annoyed also (although a gift is a gift).

Op in your position you need good, sound financial and legal advice on what you can and can't do. Maybe your dh will agree to leave the inheritance to you and split everything 50/50 if he's not that bothered by money? Although I often read that people who aren't bothered by money, only do so because they have a higher earning partner and all financial responsibilities covered by someone else. It's a different matter when you have to be responsible for yourself and find yourself having to kerb your lifestyle as a result of your choices

You've already had 200k from your parents and you're now saying you could use more. Where does it end? Have you thought of living within your means?
If you're not happy get a divorce. Don't take any more money from your parents if you're concerned he might take it.
Live off the money you have worked for.

littlepattilou Tue 25-May-21 12:21:11
skirk64

Look at this from the other way round, if a man was a high earner and had been given money by his parents to buy a home, if his wife was earning little or nothing and they decided to divorce - everyone would be arguing the wife was entitled to half.

It's the same situation here. You got married, you share things equally. He may or may not get an inheritance in later life - you don't know for sure until the money is in the account.

I'm not that sympathetic - you gamed the system to avoid inheritance tax, now you're upset you can't game the system to cheat your husband out of his fair share.

This in spades.

@SallyA1976 I have NO sympathy with you. You gamed the system to avoid inheritance tax, and are now miffed you will have to share 'your' inheritance with your husband.

There's no shame in disliking work and just wanting to stay on a lower rung of the ladder with no promotions, ever. I know a few people who have not progressed in their workplace for 15-18 years or so, because they CHOSE to not progress.

Several of them are now on a higher salary than the manager, because of their yearly increments over the past 15-18 years or so. £12 to £13 an hour they're on, for a basic, no responsibility job, and the manager is on £11.50 an hour. (Because they have only been there 2 to 4 years.)

And if your husband is a substantially low earner, then why did you even bother marrying him? You must have known you would grow to resent this eventually!

Also, why is it your husband's responsibility to 'provide' for the family? This is 2021, not the 1950s.

Oh, by the way, you haven't got a leg to stand on. If you divorce your husband, he will get half of everything.

Best wait until you're divorced to get the other cash gift your folks are dishing out to you. Then you can spend it ALL on yourself! wink

You really sound like you dislike and resent your husband. I feel sorry for him to be honest. Do him a favour and cut your losses, and divorce him, so he can be with someone who respects and loves him more.

You owe him that.

1000000000%. You should think carefully about who you choose to marry, not resent and try to spite them later on down the line!

My parents gave me £100k inheritance early so I could buy a house. However they have secured a charge over the property so if I was to split with DH then the money is repaid back to them before the sale proceeds are divided. Perhaps you could look at doing this?

I voted YABU because you can’t have it both ways: avoid using inheritance to pay for care fees and/or avoir inheritance tax AND avoid the risk of having to split the money in case of a divorce.

In other words, getting the money now or when your parents pass away both have risks, you just need to decide which risk is the highest.

You say that your DH will get his full inheritance if you divorce in the meantime, but this is conveniently ignoring that there is a risk he gets nothing because of care home fees.

Too late. If you were that unsure about your husband, then 1. You shouldn't have married him and 2. You should have ring fenced the money originally given to you when you had solicitors drawing up the contracts. I don't believe they wouldn't have mentioned it.

You're annoyed he hasn't changed in his work ethic, but I don't know why. Not everyone wants to keep progressing. You shouldn't have expected him to change.

You've gained significantly already from your early inheritance. Suck it up and deal with the consequences.

My parents gifted us a similar sum around 10 years ago as a house deposit. We divorced 5 years ago and I got about 70% of the amount back in the financial settlement in court. I had always been the higher earner. Judge said that he recognised that my parents had given the money for it to benefit me but also said that the split should give us both a house deposit. I’m so sad for my parents that I lost their money like this.

Wives deserve half as they give up their own careers - stupid and simplistic to say ‘if this was the other way around’

OP hasn't indicated anything of the kind. And if after all this time women are still chucking away their financial security, it is about time we seriously discussed having it included in the school curriculum.

Sorry OP - them's the breaks. If you're trying IHT avoidance tactics can i assume your parents are fabulously wealthy? They need(ed) better financial advice.

10 years is a long time, you don't mention DC so I'd assume that in the case of divorce it would be a 50/50 asset split. If the cracks are showing and you're keen to engage in more tax avoiding activities with your parents do yourselves a favour and divorce sooner rather than later.

I'm so sick of seeing people claim that 'if this was the other way round, women would be saying 'X'. Its just evidence of conformation bias.

What women actually say is that is a man fathers children he should pay for them.
Inheritance is usually ring fenced and treated differently from earnings in divorce. See a solicitor and find out where you stand.

Do not take a penny from your parents.

It sounds like you're going to need it after the divorce, which he doesn't want whilst he knows there's a lot of money he could getting his hands on.

Men often don't share marital assets though - a marriage does not mean splitting and sharing assets in many cases.

OP - you need legal advice. I do not know how you do it retrospectively as we did it at the time the money was given to me - the property is in my name only and I pay all contributions and upkeep of it.

Probably helps my partner's family are absolutely loaded and their religion ensures women are provided for in the majority of cases of divorce etc.

The money my parents gave me (and it was me, not him) was to secure a property for myself and any offspring - that's what it was for and that's what it has been, and will always be, used for.

Tbh I would split now. Accept you may lose up to £100k but just write it off. I imagine that money has worked hard for you if you invested it in a house so it's not a total loss.

Speak to your parents and explain you would rather they held onto the money until you are divorced, at which point it will be gratefully received. There is nothing your DH can do about that (obviously don't rub it in his face)

No point in dragging this out.

(My parents didn't give me money for tax reasons though - they did it because I needed help to get on the property ladder!)

Money makes the world go round! and ends some marriages,, sad times!

Inheritance is usually ring fenced and treated differently from earnings in divorce

Only if it’s been kept separate from family finances from the point of inheritance. Once it’s integrated it’s part of the marital pot. I’m well aware that if I divorced the substantial sum from my inheritance I used to pay off my mortgage would be split down the middle.

I understand that in Scotland assets that predate marriage aren’t taken into account in divorce although they are in England and Wales.

Thanks everyone - it's helpful to read all the responses. My husband by no means sacrificed anything to look after children - so in terms of a setup whereby the woman sacrifices her career to look after the children - then assets should be split regardless of who earns what. Quite rightly! We don't have that situation. The career sacrafice has been mine and includes 4 years where I had to quit my job (I was constructively dismissed due to having a baby), retrain, and start over again returning straight away as the highest earner due to how hard I worked at my new career. So the work sacrifice has still been mine but I've worked so hard to get back out there. I'm also the dominant parent and the kids go to. I worked hard in my new career to provide for my family as in my house, I'm the 'provider' and I accept that role. But it eats at me the more time goes on. I don't agree that it is acceptable to not try to progress at work and thereby not be able to afford things for your kids, or to let your wife or husband take that over that role unless there is good reason like young children etc. As the breadwinner, and the dominant parent I'm exhausted with obligation but my husband can pick and choose. I don't think that's fair.

My experience with Trusts is they cannot be relied on in UK to protect assets in the case of divorce.

Decide if you want to divorce or stay together.

If you divorce, do it now, mentally write off 50% of the £200k gift and tell your parents to not make any further gifts until divorce and financial settlement is finalised.

ust so you know, only the the law in the UK. In many countries (including where I live) assets on marriage; gifts and inheritance are presumed to go to the adult child only and are removed from the pot before division in the case of divorce. Quite Rightly
I assume you mean the Law in part of the UK (England)
In Scotland generally speaking inherited wealth only becomes joint if it is converted into a joint asset
So in this case the house would be joint but if more money was paid and kept in the bank or whatever in the OP's name it would not be joint