To stipulate conditions on FIL's financial gift to our son

[alicet]

FIL has decided that rather than give our 2 ds's presents at birthdays and Christmas he would prefer to give them £1000 a year until they are 18 to go into their child trustfund account. Wow, how very generous thanks a lot we thought at first...

However I am now feeling increasingly uneasy at my boys getting such a large sum of money to do whatever the hell they like with when they turn 18. Initially when he started this he asked where he could put the money and we told him either the trust fund account that they could get when they were 18 or into a separate account we were opening to save moeny for them for stuff like university / first car / house deposit etc etc. And he chose the trustfund account as he wanted them to be able to spend the money on whatever they wanted.

I don't have a problem with them blowing the money if that is what they choose and they are sensible enough to realise what they are doing. But I think 18 is pretty young and boys especially are not that mature at this age. I worry in particular about them not appreciating the value of this money. I also am concerned that they will get used to living the 'high life' on it and then when its all gone they rack up massive debt as they continue to live in the same way. Dh and I had also planned to tell the boys that if they got to 21 and hadn't any points for speeding we would buy them a car in an attempt to get them to drive safely. Things like this will not work if they can buy whatever they like.

Dh agrees with me but makes the point that fil can do what he want with his money and even if we are concerned enough to not accept his gift he could open a trust account for the boys to be gifted to them when they turn 18 anyway.

Now I appreciate it's his money but I also think that as we are their parents we should be able to stipulate how it is given to them. I would be happy for them to use it as they choose but I would like to be able to give it to them when I judge them to be mature enough and know the value of money (which may or may not be 18) rather than at 18 regardless.

Am I being ungrateful and unreasonable? Would it be unfaur of me to bring this up again and request that he pays it into the other account? Dh and his father have a complicated reliationship and fil is likely to dig his heels in if dh asks this so it will have to come from me or not at all...

Thanks for reading this far, sorry it's so long, and thanks in advance for your advice!

See here.

Thanks ladymuck that's really helpful. Will show it to dh tonight and see what he thinks about broaching the topic with fil.

Just remembered that unfortunately I think we told him that we didn't want to put any money in CTF as we wanted control over the money ourselves! Boo hiss - never mind

As mentioned before, stipulations can be really difficult as you don't know what your particular child will need. When I turned 18, I needed help with UNI, but my brother needed a concert violin and my other brother a special type of computer. Difficult to foresee.

In my own case, I am prepared to accept that once my children do turn 18, they are adults in the eyes of the law and have to get on with making their own mistakes. At this age, I was no longer living at home or depending on my parents for any decision, financial or otherwise.

Having a sum of money may mean a few extra mistakes (depending on how well I have prepared them to cope with money), but not having it won't protect them from a life full of decisions. And if they don't go to UNI on grandma's trust fund, they'll be going on borrowed money, which has its own problems.

I had a saturday job/tiny clothes allowance and was a very sensible teen, BUT arrived at uni and spent my first term's grant in 3 weeks! I was very different at 21 because I'd lived away from home and learned how to budget.Yes you are an aduly at 18 - doesn't mean you are an experienced one.

its wise to attach conditions.
Members of my family inherited about 20k each when they hit 21.
the money came from their dad who died at a young age after the buisiness he set up had made its first years profit, after 4 years of hard work and slog on his behalf. He died and the money was left to his kids.
They blew every single penny on drink and it bought them trouble with the police etc.

we as a family were heartbroken and absolutely helpless as they drank away the money.

now they are 25 and settled with children of their own, we wonder how the money would be spent now that they have come out the other end.
They have nothing to show at all for that money only criminal records.
neither have a home of their own, both on benefits, such a waste and an awful way to honour a precious lifes work.
put conditions on, 18 is way way way too young.

Ask your self how you will cope with your kids making "an extra few mistakes?" in front of your eyes with nO control over it and no way of showing them what an awful regrettable mess they are making?

For us, we were just expecting a message telling us that one of them was dead in a gutter some where.

they had lovey upbringings, were lovely sensible kids, strted college courses,had jobs then bam..they got the money and were both sacked within 4 months, chucked off their college courses and ended up in cells every weekend.
We as a family lived through that, was the hardest thing ihave ever done in my life.

Could you ask him to put it into a pension for them instead of a trust fund?

That would have accrued enormously by the time they retire, and benefit them very well. It also means that when they are starting out in life, uni, first jobs etc they would not have to worry too much about finding extra contributions.

Pensions rules have changed now, and you have a personal 'pot' which transfers with the individual IYSWIM.

It is a very generous offer of him... wish I had a FIL!

I know that the idea of personal pensions for children are all very tax efficient etc, but tbh given that this is in lieu of birthday and Christmas presents during childhood, 54 years is a very long time to wait for your first birthday present! Even having to wait for almost 40 years to receive a present for your 16th would seem a bit much. And there is just no flexibility. You could be on the breadline with a £1,000,000 pension pot, but you cna't touch it until 55.

donbean your story is exactly why I don't want them to have the money at 18. Made me feel quite sick as I read it thinking about how I would be able to do absolutely nothing about it! Really sorry you had to go through this - good to hear they have come out the other side...

I really really don't want to be interfering mum preaching at them about being sensible with their money. Which I won't have to do if they can't have it until I choose. Would be more than happy to give it to them to go and travel round the world or to enjoy - we will be saving for uni (or equivalent if they do not choose that path) anyway. But I am just terrified it could wreck their lives if they are not responsible with it AND spoil my relationship with them as I know I would find it almost impossible to sit back and let them wreck their lives. Appreciate this could happen anyway even without the money but thats another debate I guess...

it is an awful story and i nearly didnt post because i dont feel comfortable making you think of such an awful scenario, however it needs to be said as an example of just one of the ways that the situation can go.

you will not be a nagging mother, you will be a concerned mum, who wants what is right for her children and who wants to guide them into making worthwhile decisions about some thing that could be a hinge on which their future hangs.

Make no appologies about that.

at the end of the day there is no crystal ball in which to gaze and predict the future of our children, however you can have some control and influence over what they decide to do, if done cleverly, you can ensure that they take the right road.
if they go off that road along the way, there is always a little path back. I have found this out for myself even before having children of my own!

Haven't read all of thread so sorry if I am misunderstanding...
I was lucky enough to inherit a good sum of money at age 16. It was mine to spend as I wanted with no stipulations etc. However my parents made very clear that my Grandma (who left me the money) wanted it to be spent on important things, not frittered away. They suggested I put it away in a ISA type thing where I would lose out if I took any out in a 5 year period, and I saved the bulk of it for a car, travelling and deposit on a house. And I was no Angel!
What I am trying to say is that you have 14 years or so to present to your DCs the idea that they will get this money at 18 - but it is for a house/car and not a social life. So it doesn't come as a big surprise windfall, but just something they become responsible for on their Birthday. You can easily make them feel it is a responsibility to take care of the money and spend it wisely.

donbean don't apologise - this was what I had been worrying about so you didn't make anything worse!

ksld good to hear a more positive story too though... I think another poster suggested this too - to make them know that the money is special and not to be frittered and hope for the best.

I think I will have a chat to dh (show him this thread) and then think about whether to broach the topic to fil. Thanks everyone for your help

Conditions are sensible. Friend of mine at university inherited £10k at the age of 18. He pissed it all up against the wall - in fact alcohol was about the most respectable thing he spent it on. A little money to enjoy yourself is fine but too much = trouble. Not many 18yos are mature enough to resist temptation.

I have a thing about this. We intend to save for DS when we get round to it , but I have no intention of starting an account in his name or putting money in his trust fund one. It will go in an account in our name to make over to him when we see fit or when he wants to spend it on something appropriate. And I don't care if people think that's too controlling!

I have every confidence in the fact that we will bring DS up to know all about the value of money etc, but I can't think of a single person I knew at the age of 18 who wouldn't have let a large sum of money like that to do as they like with go to their head and wouldn't have wasted at least some of it and/or been taken advantage of by 'friends'. That's a huge amount of money at that age, an age when you're not normally thinking about buying houses/paying for weddings or whatever.

Difficult as it is your FILs decision, but I would be inclined to voice your concerns to him, decision is his ultimately of course, but I don't see a problem with having the conversation. I certainly will be with my PIL should they wish to give money to DS in the future as they have to my niece.

I would certainly try and increase the age to 21 at least, or better still 25.
I too was a responsible (mostly)teen, who had worked most weekends/holidays at school and I still managed to spend the first terms grant (oh they were the days when ordinary students got a grant)in less than a month - it just seemed like a vast amount of money to an 18 year old.
I did get a lump sum from a lovely great uncle at 21, but by then i was sensible enough to hang onto it for another couple of years, and use it towards a deposit on mine and dh's first house - i really appreciated it then, at 18 I would just have wasted it all.

ahh - now I see (sorry been away from the computer since my last post) you want the age that they can access the money to be stipulated and not what they can spend it on stiuplated.

I can certainly see the + points in the that, however I do also know people in their 30's and 40's who've inherited large sums of money and frittered it away with nothing to show for it.....so can be tricky to decided when is the "best" age. IYKWIM

I can't help think of myself at 18/19. I was engaged at 19, married at 20, had my first child at 21 and we bought our first house when I was 23.....what if you stipulate that they can't have the money until they're 21/25/whatever, and then they get married/have children/want to buy a house before they reach the age that the money is going to be available to them?? By 25 I had 2 children!

I would start teaching them fiscal responsibility now (as you probably are), and follow some of the wise suggestions you've been given here. A windfall lump sum really can give a person a headstart in life if used wisely, and you should drill that into them.

Perhaps agree in advance an amount (10%?) that can be frittered away and used for 'fun' - gap year travel, car, holiday etc - so they can splurge and enjoy a bit of the money. But then maybe take them to a bank and/or financial manager who can advise them on different investments. If the money is invested, it won't be nearly as tempting (or accessible) than if it is simply sitting in a savings account.

Sorry but I don't think you can always class gap year travel as just pure "fun". I probably learned more in my first year of my (extended ) Gap Year about life than I would have done if I'd been at University for that year.

FAQ - would 'non-essential' be a phrase you're more comfortable with?

not really how do you define "essential" - what is essential to you or me, may not be to someone else, and vice versa. University, Car, House, yes even a Gap Year (I needed to have one as I still really wasn't sure what I wanted to do......I had my University place but didn't know if I wanted to take it up - thank god I went away for a year as I soon realised I didn't want to do it and would have probably dropped out!). Not to mention the experience I got working while I was abroad). etc etc - some people think these things are essential, some non-essential.

FAQ, if the money is in a bare trust the the trustee can give the money over earlier if they want to, so there is no problem with setting 21 or 25 but then giving the money earlier. The downside with the Child Trust Fund is that, at present, it is impossible to extend the age limit - the child gets it once they reach 18. It wouldn't surprise me to see this rule changing once the first recipients approach 18.

I wouldn't feel comfortable with that. I mean, for example.

You have 2 DS's.

One reaches the age of 20 and you decide that they're mature enough to spend the money wisely/they need it for something important

The other one is 24 before you decide that they are mature enough to spend it wisely...

I can just see family arguments brewing because one brother was deemed more "ready" for it than the other IYSWIM

25 is the standard age most people think for these things. Why not get him to stipulate they get it at that age?

However as he can give it to them now or at 18 anyway it's not much point causing trouble over it.

My children had some savings which I don't want them to waste and some (3 are at university) have been better than others over them) and you can do deals like we did - I have an agreement I fund them at university if they don't take out loans or credit card debt and over drafts. You could offer the same at 18 - don't touch your trust money from FIL and we will support you at university or something like that.

Had a conversation re her will with my Mum. Everything she wants to leave to DC is in trust till they are 25. I was very relieved to hear this. I too would have been worried if it had been 18 years of age. I see where you are coming from OP.