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?

If you want a guaranteed return - one with zero risk to capital or as close to it as possible - then you would need to accept low returns and that the value of your investment will drop in real terms.

That might be suitable for a situation where you know you need the money in the short term, but why would you be considering that over a 12 year period?

Any other trusts lawyers cringing at OP?

I would have thought financial pickle would go well with some strong cheddar and sourdough bread.

@Nocaloriesinchocolate wouldn't of thought so, the money wasn't in trust?

Well, I think the money was in trust, but I think that for all practical purposes the OP has met the terms of the trust quite nicely by lending the money safely to herself for the term. Not to mention that the son is practically enormously better off than if she had put it in a low risk fund. Anyone saying she should have put it into a growth fund, or heaven forbid one share, doesn’t understand the meaning of “low risk”. FIL didn’t ask for growth, he asked for safety.

I'm not sure an off-the-books undocumented loan to an individual for speculative property development could be described as low risk. Particularly with the conflict of interest.

How did you work out that the son is better off than if the money was in a low risk fund?

off-the-books undocumented loan to an individual for speculative property development

Give us a break. 😂

@Nocaloriesinchocolate

Any other trusts lawyers cringing at OP?

Oh this thread is bulging with "legal experts" who are cringing and fuming and frothing at me but none of them know what the fuck they're talking about

@ShoebillStork Why did you even start this thread? Any reply that disagrees with you draws insults and nastiness from you. You've gotten enough advice to satisfy your pickle-are you just continuing the thread for kicks now?

@evilkitten she said her son was better off than if the money was in a low risk investment because he had a 'cool bedroom' and that they could have both a home office room and DS did not have to share his room every other weekend 'while stepson was still with us'. So was saved from the anoyance of sharing every other weekend for however long.

No, I bowed out but people keep posting. Why are you posting EKGEMS? Do you like being rude to strangers?

Pot meet kettle

@evilkitten I guess that even if DS was only saved from a few years of sharing every other weekend with his half brother, if he was a child that needed his own space and was very uncomfortable sharing his room or his stuff maybe OP felt his childhood comfort was more important than the extra 10 or 20 he maybe could have got as an adult if the money was invested. I'm sure lots of kids hate sharing their space when step siblings visit!

You've gotten enough advice to satisfy your pickle-are you just continuing the thread for kicks now?

oh give over. WE the POSTERS are continuing the thread. Including you EKGEMS. That's how MN works.
^^
Threads have a life of their own. 🙄

@evilkitten Give up - from your posts I can see you actually understand the value of money and it’s ability to generate a return.

Those that don’t, think a 12 year investment period, put in a SP500 or a Fundsmith or Ballie Gifford, is a medium to high risk. Shows how little they know.

I estimate the kid has lost out on 10 to 50k given the ‘investment’ the OP has decided on. Very poor investment choice at the very least.

I also spoke with a CPS lawyer last night over a drink who confirmed my suspicion that it would be an offence tbey would prosecute if there was a complainant and enough evidence eg. financial record. I won’t bother going into the detail, it only generates more haters. Needless to say, it’s happened before.

Best of luck to you in your own investments, Fundsmith gave me 5% return in the past two months alone, when most funds i was in were static.

evilkitten

If you want a guaranteed return - one with zero risk to capital or as close to it as possible - then you would need to accept low returns and that the value of your investment will drop in real terms

That might be suitable for a situation where you know you need the money in the short term, but why would you be considering that over a 12 year period

Because that was what the grandfather wanted.

Interestingly since this thread has been going on my family have found out about a case of money mismanagement for a minor. The mismanager being my Uncle ( by marriage). It makes this look like nothing though. Our case is on a huge scale and is likely to backfire spectacularly in the next few years. I wonder if this sort is thing is more common than I realised.

@Thehouseofmarvels

Yes. I’ve seen it before myself.

Sorry to hear about your case too. I hope there is a restitution option in your case.

I also spoke with a CPS lawyer last night over a drink who confirmed my suspicion that it would be an offence tbey would prosecute if there was a complainant and enough evidence eg. financial record. I won’t bother going into the detail ...

because you are a complete fantasist. I on the other hand was having dinner last night with Sir Keir Starmer who assured me as a former Director of Public Prosecutions he would never have entertained such a case ...

Those that don’t, think a 12 year investment period, put in a SP500 or a Fundsmith or Ballie Gifford, is a medium to high risk. Shows how little they know.

Not as much as you do clearly. 😀

I also spoke with a CPS lawyer last night over a drink who confirmed my suspicion that it would be an offence tbey would prosecute if there was a complainant and enough evidence eg. financial record.

"my mate down the pub"

"Complainant" Therein lies the problem. No one is complaining.

Cool Bedroom👍🏻
No Sharing👍🏻
Birthday Car👍🏻
£12,000 ISA👍🏻
DS's Fledgling AirBNB Biz😬
Happy Son👍🏻
Satisfied Gramps👍🏻

No offence meant Bard you sound a decent sort. We're obvs just different animals.

@bard6817 the uncle in question is nearly 84 and has created a huge and expensive legal mess. He normally would not discuss finances with anyone including my aunt because he believes in the old fashioned way of the husband does the money. My aunt is 25 years younger second wife and the money is a life insurance policy from her deseased stepdaughter which was invested 30 years ago. Should have gone to his grandchild that he has ( I think ) never met, and is around 30 but he decided not to give it. Seems HMRC want tax paid on the profits as he is a trustee. Apparently its a huge tax bill. He is trying to work out how to sever his tax liability without handing over the money to the grandchild. My brother said he asked twice whether my brothers partner was studying or working in the space of five minutes and said something that indicated he thought he was still working when he is retired. Mum thinks my aunt does not know hmrc are chasing them and will have a fun surprise if he dies or his memory gets worse.

He is controlling he would never give money to someone he has no relationship with ( grandchild phoned from native USA as adult but relationship never developed) my brother said he did not seem to grasp that as a trustee he could not choose to give the money based on his feelings. He grandchild does not know about the money.

He grandchild does not know about the money

Shouldn’t someone tell him

The thread is so long that I gave up even on reading all OP's posts. Here's my 2p anyway.

All the people accusing OP of ripping off son and saying he should have a share of the uplift in the house are confused in their thinking. The OP is her son's banker, when you put money in the bank they pay you a small amount of interest on the money they owe you. What they do with the money they have borrowed from you has no effect on what they owe you.

(Newsflash: banks do not hold money in trust for you, the money you transfer into your account becomes legally theirs, the balance on your bank account is the amount the bank owes you, i.e it is an amount on loan from you to them, it is not (I repeat) an amount it is holding in trust for you.)

The FIL specified a low-risk investment, having a notional debt from the OP to the son of the original 10K plus interest at a low single digit percentage is exactly the right approach.

What the OP did with the money is irrelevant. She could have spent it on a holiday, or bought lottery tickets and won eleventy-million pounds. It would have no effect on what she should pay her son.

@Thehouseofmarvels Sounds like a right mess!! My experience of hmrc, is that they will be a nightmare if they have to chase, but come forward admit a mistake, offer interim payments whilst it’s all being sorted, and they will work with you.

Makes you wonder about a person when you see these thing go on.

I try not to get upset when i see these things, karma comes to bite later, i choose to believe.

Due to the Country involved, im supposed to be getting 50% of the family estate, but i stopped having anything to do with them 15 years ago. Infound out through other family that some shifty shennanigans is happening with that estate to lock me out of it. I don’t particularly care, indeed it proves to me i was right to have nothing to do with them, but my sister when she attempts to reconcile at some point in the future, will be a fun conversation. When money is involved, i just find even families can go mad member mind friends. If my sister asked if i’d wanted my share, I’d have said no anyway and asked it be invested for her two kids, in an ETF.

Good luck, i hope the shennanigans you are going through, dont impact your immediate families estate/inheritance, because as trustee, he may be personally liable on some level too.