A few months ago, my 2 DCs and I each inherited a five-figure sum of money from my grandmother. I've put the money into Premium Bonds (in the UK). To be clear: there are three accounts, each with an equal amount of money in. One is mine, one is DC1s and one is DC2s. For those who might not know, Premium Bonds pay out monthly prizes instead of interest. Prizes start at £25 and there are two monthly jackpots of £1m.
So far, we all tend to win something every month, which is great! Given the nature of Premium Bonds, we are winning different amounts each month. The money is paid out into savings accounts, not reinvested in more bonds.
DH and I were chatting about this at the weekend. (DH is DF to the DCs.) DH thinks I should be splitting the winnings equally between us each month rather than letting one child win/earn more than the other. He thinks both DCs should be treated equally and that all winnings should come to me, and I give a third to each DC. On the face of it, this seems fair and the obvious thing to do. The winnings seem to even out over time, but for example this month DC2 has won four prizes but DC1 has won none.
However, I thought about it a bit more and I'm not so sure this is the right thing to do. My Premium Bonds are in my name, DC1s in their name and DC2s in their name. I don't think I have the right to have DCs winnings paid into my account and to redistribute them according to how I see fit. I think it could technically be theft unless the DCs consented to this arrangement. DCs are 14 and 11, so arguably have the capacity to do so, but you could also say that it's coercion. This is more of a legal point.
My second reservation is more moral. It doesn't feel so important to me with smaller winnings, but what if one of us wins the £1m jackpot? It sounds awful, but if I won £1m I wouldn't necessarily want to split it three ways with my kids right now, and I think if I were to die within 7 years there would be IHT implications (as the money would have been a gift from me). At this stage in my life I would want DH to inherit, and he would take care of the DC. But then what if one child won £1m? I wouldn't expect a share, but how awful would it be to have one millionaire DC and one with "just" a uni fund? This sounds like such a first world problem and likely to remain hypothetical, but I now feel that I need to come to some agreement with the DCs on how (if at all) we split the winnings. And how long should this arrangement last? Forever, or until turning 18, or until we agree to end it? What if DC2 (11) agrees to split £1m now, but as an adult thinks that in hindsight they didn't have the mental capacity to make this decision and we have a big family fallout?
On balance, I think each of us should just keep their own winnings. AIBU?