To ask for help with financial pickle

[ShoebillStork]

In 2009 FIL had a win on the Premium Bonds. He gave us £10,000 to invest for DS (at low risk) and the money to be given to DS when he's 18.

I put the money towards a loft conversion. DS is 18 soon and I'm due to remortgage for a better rate. How much do I need to release for him so he gets the £10k plus what it might have gained in interest since 2009.

And should I encourage DS to get a Help to Buy ISA with it?

@ShoebillStork but I do think his air bnb idea is fairly brilliant 😂

@HollyGoLoudly1 Walk into a shop, take an item, walk out. When the police arrive tell them you intended to pay.

Are you explaining you can't take things from shops without paying?

Thank you

🤣

Walk into a shop, take an item, walk out. When the police arrive tell them you intended to pay

This is in no way a comparable analogy to what has happened.

I think the kid has more smarts than the parent.

For those of you laughing - the money was not for the OP to use, it was to invest. It’s theft at the time, compounded by some ludicrous return on the investment return that doesn’t reflect the investment performance.

My daughter was given the 250 voucher in 2005 from the government then 250 I think the next year. I put it in Nationwide and when she was 18 she had nearly 1500 in the account, if this is any help at all?

Amount invested without any documentation or agreement in place. It was done in secret.

I am weak. In secret.

@HollyGoLoudly1. No it’s actually far more serious, the amount involved would not get a caution, the CPS would be seeking jail time.

For those of you laughing - the money was not for the OP to use, it was to invest. It’s theft at the time, compounded by some ludicrous return on the investment return that doesn’t reflect the investment performance.

Laughing. I am crying. I want to be there when you report this. And she did invest it.

I haven't rtft but perhaps another way to look at it is, what would YOU have paid if you had taken a £10,000 loan over 10 years? Maybe thats what your son gets back.

[quote Bard6817]@HollyGoLoudly1. No it’s actually far more serious, the amount involved would not get a caution, the CPS would be seeking jail time.[/quote]
The police would 100% not be interested in this.

Yep, I'm sure OP set out to "profit from her child"

She may not have set out to but that’s sure as hell what she’s doing now.

I’d see if I could find out the lowest interest rates for the safest, risk free investment around at the time. So if DS would’ve made eg £2000 interest, I’d let him know that that’s what grandad gave him and then his car money is from you.

I imagine if the housing market went down, OP would still give her DS the £10k plus interest, so I wouldn’t expect her to add increase in house prices on top.

The way I see it you effectively held the money as trustee for your son and had a duty to act in your sons best interests which you did and decided to use his money to build the loft conversion. However this money is his money. This investment held certain risks, eg the property market crashing, you being unable to pay the mortgage and the house being repossessed. You dying and his investment that no one else knew about being lost.

He therefore is due an appropriate return on his investment which would be at the very least £10k x by the percentage increase in the value of your property.

I think you need to be very careful here if your DS found out and felt he was out of pocket he could sue.

She may not have set out to but that’s sure as hell what she’s doing now.

That's what you said and yes it was bum.
Can't even see how she's profiting now.

This thread keeps on giving 😂

@Bard6817

I think the kid has more smarts than the parent.

For those of you laughing - the money was not for the OP to use, it was to invest. It’s theft at the time, compounded by some ludicrous return on the investment return that doesn’t reflect the investment performance.

Yes I'm laughing - out loud. You have a warped view of the law if you think this in any way could be construed as theft. OP as the parent invested the money on behalf of their 8 year old DS.

End of story.

@HollyGoLoudly1. Police aren’t interested in a lot of things, but when a theft is reported and evidence is provided they pass it onto the CPS.

The CPS will perform their tests, which sadly given the state of the judicial system right now, includes ‘is it an easy win’. This is.

A decent lawyer will argue that the house was an investment, that there is intention to make return. Who knows where those chips will fall.

A lot actually depends on the attitude of the FIL, if he believes this was inappropriate, which given the secrecy, one can argue is likely, then the CPS may go for the throat.

I’ve seen all this before, sadly. Sometimes it’s innocent…. But the shocking thing here, is that the kid isn’t getting the return on his investment he should be. So bear in mind there’s potentially two offences here.

I guess we will have to agree to disagree though.

Just give him £11/£12k that's more than enough

Interests rates have been really low for years now

*@HollyGoLoudly1. Police aren’t interested in a lot of things, but when a theft is reported and evidence is provided they pass it onto the CPS.

The CPS will perform their tests, which sadly given the state of the judicial system right now, includes ‘is it an easy win’. This is.*

Pure bum.

*Police aren’t interested in a lot of things, but when a theft is reported and evidence is provided they pass it onto the CPS.

The CPS will perform their tests, which sadly given the state of the judicial system right now, includes ‘is it an easy win’. This is.* *

Explaining how prosecutions work. 😉

Dear God that snacks of definate overkill!! Don't think fraud comes into it when she's fully intends to pay back with interest from day one!

Smacks

some of the responses here are
Laughable and not helpful

OP is saying she will re-pay the £10k plus interest and her questions is what rate of interest? No harm has been done

She's not asking for opinions on anything else

@ChequerBoard I can accept that many will take that view.

However, What about not providing the full value of the investment return to her son? 30% for an investment return of a decade isn’t small, but it equates to marginally over 2.5% per annum, and any investment doing that isn’t worthy of the name. Investment returns of 5-7% pa are normal for the financially unaware, and 18%pa is regarded as achievable. Rule of thumb is double the investment every 5 to 7 years. That makes the kids investment about 30k. However, in this case property, has increased in value, and the investment isn’t providing the return that property has achieved.

@Bard6817

Kinda shocked here at the appropriation of funds.

On basic investment return terms you should gb doubling the investment every 5 to 7 years, although Covid has meant that the last 5 have been incredibly profitable. The return should be abouts £30k.

You can present it as you see fit, but i consider what you did theft. Shocked that a parent would do this to their child. It’s not the first time i’ve seen it, won’t be the last, but it still shocks me every time.

This feels toppy to expect your investment to double every 5-7 years, especially when the instruction was “low risk” I’m sure wise investors could achieve this but your basic investor would struggle to achieve this type of return. Many people are quoting very low returns (c. 2-3% whereas to achieve the growth you’re talking about would be something close to 10% pa. Even the ftse hasn’t grown at that rate since 2009.