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?

Dont bother messing about. £15.000 is fair. It is doable about on your mortgage (hopefully) interest has been pants for a long time. In my opinion that is a fair return. Dont give an 18yo that kind of cash, he will more than likely blow it and then regret it later. Sit him down tell him where it is and that you can get the lot for him and help him reinvest plus give him some for car

The way premium bonds work is not interest but winnings. DS might have won £25 one month and £25k another month; you took that opportunity away from his savings for your own financial gain, so you need to make that right by at least giving him a fair share in the actual investment. You can share the gains you made in the property in the same way you would have done had he been any other investor.
Your property investment was £x + all your mortgage payments £y, his was £10k, property now is worth £z; so his share is £z * (10000/(x + y + 10000)).

"The son didn't invest it as he was 6" true but op was to invest on his behalf.
The name calling is ridiculous.

@SeeSection

Wow OP there’s a whole bunch of weird judgy folk on here with no sound knowledge of investments. What would have been better? Sticking it in a 0.1% interest account???

Ok so to calculate benefit you go - price of house then, price of house now. % of original price that 10k constituted , then what is % of what it is worth now.

Your son is lucky to have a canny mum. It’s probably at least double what he was given originally :))

She's already said he's not getting that much.

This whole thread is hilarious. Love some of your responses to the madness on here OP. Do let us know when the Airbnb opens up, it's been tricky to find accommodation in cool locations this year.

1. Only because the OP is framing it as creating a bedroom for DS. When actually, there were enough bedrooms all along, but DP was hogging one for WFH and piles of stuff. Really, the loft conversion can equally be framed as creating an office space for DP that meant he wasn’t taking up a bedroom. The fact DS has had a swanky room is a red herring.

yep it DID create a bedroom FOR DS.

Unfortunately DP was earning a living too 'hogging a bedroom' WFH -

You have NO idea what OP 's financial situation 10 years ago was.

Laughing at all these folk around the country
WFH who are "hogging bedrooms".

Out with you! That's a bedroom.

@sunglassesonthetable

1. Only because the OP is framing it as creating a bedroom for DS. When actually, there were enough bedrooms all along, but DP was hogging one for WFH and piles of stuff. Really, the loft conversion can equally be framed as creating an office space for DP that meant he wasn’t taking up a bedroom. The fact DS has had a swanky room is a red herring.

yep it DID create a bedroom FOR DS.

Unfortunately DP was earning a living too 'hogging a bedroom' WFH -

You have NO idea what OP 's financial situation 10 years ago was.

It doesn't matter what OP's financial situation was nor is, she took her son's money that she was supposed to be looking after on his behalf. Had it been set up as a trust, her DS could sue her for mismanagement of the funds (or theft depending on how much the pays him), that's how the law works. As it wasn't set up properly she may be able to hide the fact her father gave her the money for DS, but it's still morally theft.

So going forward now, you are able to give cash gifts of up to £3000 per tax year without any tax liability

Surely, this only applies if I die within the next 7 years? If not, what about all the cash parents give their children to support them through uni?

I really do think this should go into classics as an example of bonkers frothing and indignation.
Special mention to the poster that made up a man!

Had it been set up as a trust, her DS could sue her for mismanagement of the funds (or theft depending on how much the pays him), that's how the law works

👍🏻 yep but it wasn't set up as trust and no one ever requested it should be.^^ Law lesson withstanding.

You know about the paying back plus interest don't you? Or still thinking about DS sitting in his lovely attic room Making plans to SUE his Mum.

🙄

If not, he could contest and be awarded 50%, thus the son not actually getting 100%

It's my house. DSS has absolutely no legal claim on it. He'll get 50% of his dad's house, DS will get the other 50%. Unless DP changes his will which I consider his business.

He can't sue because it wasn't set up properly. She freely admits to making a huge profit on the back of her son's money that she was in charge of investing. The point of premium bonds is that there is a potential for large additional rewards, but the mum took that opportunity away and instead wants to give the boy just interest even though the investment paid off. You might argue it's reasonable if she at least didn't make money out of it, but she did.
Do you normally think it's ok to steal someone's property as long as the legal technicalities are ok? Or is it only OK to steal it because he's a child?

I can't believe the fuck-wittery going on in this thread - OP you have done a really sensible thing with the money, all works out for everyone and I'd top up his £10,000 to 15,000 and let him do the Airbnb thing - you have a wonderful son probably because you sound like a wonderful mum

@ShoebillStork

If not, he could contest and be awarded 50%, thus the son not actually getting 100%

It's my house. DSS has absolutely no legal claim on it. He'll get 50% of his dad's house, DS will get the other 50%. Unless DP changes his will which I consider his business.

And, presumably, a % of his mother's house.

I love this thread.

We nicked our kids money to buy a buy to let. Now YA, they know they have money invested in that house and they are delighted that they will have some money towards a deposit for a house when they need it. We will pick an arbitrary “interest rate”. I think somewhere along the line the gps who gave it to them it over the years for birthday etc, have realised that’s what we’ve done as it wasn’t a secret, but we certainly didn’t consult them at the time. They haven’t called the police yet 😃

I’m sure it will cross the kids minds to sue us when they realise how much they “could” have made if we’d invested it in these funds people keep mentioning - oh wait, they are nice kids and grateful for the helping hand they’ve been given. —and they’ve not even had the benefit of a cool attic room with en suite, to live in all these years—

Does that mean my kids have been treated worse than yours, op?

Got to love some of the posters on here...

OP asks for interest calculation.... 99% of replies are outrage at her morals. Focus ladies, focus!

@SpiderinaWingMirror

I really do think this should go into classics as an example of bonkers frothing and indignation. Special mention to the poster that made up a man!

Not just any man

A new man
The worst sort

Do you normally think it's ok to steal someone's property as long as the legal technicalities are ok? Or is it only OK to steal it because he's a child?

Only under 5s 🙄

Dear god get a grip.

but the mum took that opportunity away and instead wants to give the boy just interest even though the investment paid off.

= the opportunity to have his own private space at the time it was needed

= the opportunity to nurture a decent with DSS by not sharing a room. Good for both boys at the time it was needed

OP is NOT a financial advisor tasked with getting the MOST ££££ for her client FGS, she's a mother getting the MOST for her son in all directions. Emotionally and practically included.

DS would not be SUING because he had a great living space GROWING UP when it was needed.

He got a cool bedroom (his words), will get £10k plus interest and will inherit the lot when I croak. Which will be very soon if FIL finds out ...

DS would not be suing because he's too busy using his cool attic room as an AirBNB.

Do you normally think it's ok to steal someone's property as long as the legal technicalities are ok? Or is it only OK to steal it because he's a child?

You can quite clearly don’t understand what the word ‘steal’ means
Maybe step away from the thread and spend the time getting acquainted with a dictionary for a bit..?

The rather nasty and judgemental comments to this thread are pretty shocking tbh. It’s not helpful and I don’t believe you’ve tried to rip off your son.

@GappyValley you are ridiculous and should get a grip.

The outrage on here is hilarious. I think you have been very savvy with an investment that has also benefitted your son.
How many people spend Child Benefit strictly and only on their children? Pretty sure lots of it goes into the monthly family pot.