Not to take the money my parents have offered?

[ChristmasPudding83]

This revolves around a big house/ area move (sorry it’s a long one). I do realise we are in a good position in lots of ways and this is probably a low ranking problem on a world scale, but it’s doing my head in!

I’ve pretty much always lived in the same area, where my parents are about half an hour away and we see them a lot, and many friends from school plus others made along the way. My OH has lived around here for 30 years but didn’t grow up here. It’s a famously expensive and unaffordable town for buying houses but because we have both been on the property ladder for years and had some help from parents do own a house which is worth quite a lot though it is a fairly small terraced house with a small garden (it’s a nice looking house in a nice area). We have two children who go to a really good local primary school, though secondary school options are iffy but we’re not there yet.

About a decade ago, my husband and I started a quite unusual ‘rural’ business. It was hard work and is never going to be massively lucrative but we have been successful and enjoy what we do, and now do earn enough for things not to feel really tight. However we need a very specific kind of premises to run the business - most people who have this kind of business live there. We started ours by renting somewhere else to run it at, which is 20 minutes drive away, but we have really outgrown the place we rent and for other reasons too it increasingly feels like time to move on from there. However because of the area we’re living in, buying or even renting somewhere else to do the business is proving totally unviable (believe me we have looked!) - there aren’t many properties that would work and when there are they go for way way over our budget.

For the amount we have in our current house and savings plus what we can get for a mortgage we COULD completely relocate and buy a bigger house/ property where we could live and run the business, but it would mean moving far away: realistically Wales or Scotland (which would be 4-6+ hours from where we are now and my parents) to get the size of house we’d want to be able to have people to stay.

However my parents came into some money a few years ago and have offered to give us quite a large sum out of that to help us make this move possible. If we accepted this money, our budget still wouldn’t be enough to stay in the area we live now but would mean we could probably be more like an hour or two away. They have said this would be effectively me getting my inheritance early (and in fact they will change their will if we do it). They want to be supportive of our business which we’ve worked hard to get where it is now and say they’d like to see us enjoy the money while they’re still around.

However I feel very uncomfortable about taking the money. I have three siblings and while they have all had help in the past to buy houses etc I know my parents couldn’t afford to give us all the same amount of money they are talking about giving me before they die. My siblings seem fine with the idea of us getting the money now but I worry about what might happen in a few years time if something changed (and are they REALLY fine with it deep down? I’m not sure I would be). My dad has also alluded in passing to other projects/ charity contributions they won’t be able to do if they give us this money . I also think it just ‘feels wrong’ and would make me feel like I should get them to approve wherever it is we choose or want to move to and that we owed them too much, and really I’d much rather feel like we’d done the move standing on our own two feet.

I feel quite torn though. Moving that far away when my parents are getting older feels a bit wrong and while a big part of me feels it would be a really exciting adventure to start a new life somewhere else (I never thought I’d be the kind of person to live all my life where I grew up!), part of me also worries about things like making new friends and what impact this might have on the children.

The third option is to stay put but then we couldn’t carry on with the business long term so it would mean dreaming up a new career for both of us. I’ve put a lot into studying and building up networks etc for the job I’m doing now and it is something I’m passionate about. Plus I love the flexibility of having our own business. But maybe the sacrifice of moving far away is too much for a job, however much you like it!

I know, I’m really uncomfortable with the feeling that we look like we’re ’holding the move over them’ too. I wish we weren’t in such an expensive area!

We did something similar in my family for a sibling. They got a share of their inheritance up front. But it was capped as their share of the family home after what would be deducted if care home fees were applied. We’re not in UK so the scheme allows a % of the family home to be allocated against the cost but estate keeps balance. That way even if max costs are applied there is still enough equity in family home for other siblings to get share.
it’s not perfect obviously if there’s large drop in property values or a change to the scheme this will effect it. But there was a buffer built in as well. And of the family home is sold it will have to be relooked at as well.
Critically everyone was consulted independently first and signed off on it so there was no bad feeling. So far so good but I guess whether it holds up will only be tested after the death of the parent which hopefully is a long way off. I’m not sure how it works in UK can whole family home be taken for care costs?

It is really complicated especially since, even though you seem very committed, skilled and successful so far, businesses don't always work out.

Have you explored other ways to unlock investment in order to grow, eg all possible loans and grants?

Just on the question of location - I live 4 hours from my parents (our only family in the UK) and it is a massive pain - especially as they are getting older. Personally I would sort out the money with siblings and take it but agree completely with others on the risk around care costs in the future etc. It’s a tough one but if you live that far away it really is just holidays and it is really hard to build good relationships across generations (so grandparents to kids). We have managed it but it has been hard work and we all summer holiday together which has been lovely and creates that shared space of ‘ordinary time’ but wouldn’t work for everyone! Hope you find a good plan x

With the knowledge that you are going to have to move in the next year or so, I think you should take money.

1-2 hrs away is do-able for weekends and even the odd day trip or meet in the middle.
Moving further becomes something youll only do at holidays. And that you'll only do a couple of times a year.
While it's your own business so not tied by holidays allowance as such, you still need to put the hours in.

Yes, not immediately but within a couple of years

And still tied to school holidays….

Yes so really it makes zero sense for you to move miles away from your family and friends.
You have children, and sometimes you just need support yourselves, illness, injury, car breakdown, moving somewhere with zero support would be really tough.

Your parents have helped your siblings get their houses. So I think you should accept the offer.
However I also think if you accept it. Then it should also be ring-fenced so in the event of a divorce DH can't get his hands on your inheritance, ie you own a higher percentage of the property than him (unless he has brought more into the marriage than you).

Not unless they die within 7 years or there are overseas considerations. Assuming everyone is domiciled and resident in the UK and this is a straightforward cash gift, it's tax free.

Without outing, tell us more about your business. You rent a place, but max 2 more years. No alternative close by. But Why on earth move 4 hrs away. Tell us more about Your business. Unless it's its beekeeping, surely it can be done from many locations. This isn't even your main jobs, you both hold other main jobs and this is a secondary business. What if the cost of living means less people buy your luxury goods in a year or 2. You moved to Scotland, for nothing? To even consider moving, is beyond mental.

Also "Scotland" is a large place - I live in the north of Scotland and am a 3 hour drive from my DD and she is also in Scotland and not next to the border.

@BorgQueen Agree but another issue is if the parents require care in the future and there is insufficient funds left over, deprivation of assets could apply and a claim made by the local authority.

Surely deprivation of assets can only go back so far, ie the same 7 years as inheritance tax?
Or nobody would ever be able to give anything away or pay for anything for someone else.
It can't be that unusual for parents to help adult children with house deposits, new cars and wedding bills.

I would be resentful if I was a sibling. You may think they're agreeable but if I've learnt anything from MN it's that people are rarely truthful (in person) when it comes to matters of inheritance.

The siblings got money to help them buy their first properties too so they can't moan too much.

The idea of moving your family so far away, and away from a well established social life and connected wider family life sounds a little bonkers. It's a bit like moving to Australia.

Is this being driven by a desperation to keep the business going? Would you be bereft at giving it up? Do you have day jobs? Could you find other work? Sadly, is the business not actually viable without free premises (property as capital, funding a business expense)? Could you continue it as a hobby?

How relatively disadvantaged would your sibs be if you took the money? Could you pay some of it back from a profitable business?

This situation is what business loans are for. Have you tried securing financing to scale up and relocate your business premises?

I would not sink personal money into scaling up a profitable business.

Can they invest in the business and then should the need arise in the future your siblings inherit the investment and you look at refinancing if they want out?

Honestly this sounds like a recipe for disaster. As one of the siblings I would be very very unhappy with it but would probably not feel I could say something about it.

I don't think I would be happy with them investing in the business either tbh. While you are confident that the business will be successful in a new location that is not certain.

My in-laws have also done this, given quite a large sum to one of their children. My husband and I didn't know it was happening until some time after the transaction was complete. Like you, this money has been to help expand a business. In my in-laws' will it's specified that their other children get a larger portion of their estate when they die to compensate. This can, of course, be subject to change depending on what life throws at them in the later years.

Because they are not my parents I don't feel as though I have any grounds to complain. Also, if we were in any financial difficulty, I know my in-laws are currently solvent enough to help us out. So circumstances, in this respect, are slightly different to yours.

My friends are pretty horrified by all this and have said if it was one of their siblings being helped out by such a large extent (we are talking a substantial amount of money, well into 6 figures), they would want the equivalent. We don't actually 'need' the money, although it would improve our life if we were able to invest it, make improvements to our house or give it to our kids as deposits for their houses when they're ready to buy.

We have not fallen out with the sibling who has gained the money at all, it has never been discussed between us, but if I'm being completely honest, it stings a little to see the photos of their nice holidays etc on social media when we haven't had the time or additional cash to go on one for years.

I don't think we will every fall out over this while my in-laws are alive but, depending on what is left at the time of their death and what is specified in their will, we may arrive at that. I have watched a similar situation unravel in my own family and it wasn't pretty.

My friend's DF lent him money to buy a house (instead of a mortgage), had all the legal documents drawn up and held a charge on the property. So it was clear to everyone it was a loan not a gift, and he did pay it back, but interest free and over a long term, so it was much cheaper than a normal mortgage. Would something like that be a possibility? If I recall correctly when the DF died, the outstanding balance was part of the estate so most of the friend's share of the inheritance was getting the loan written off.

Sorry if I wasn’t clear, it is what we both do full time for a living (and we also employ people). It’s basically a diversified farming business - so we would be looking to buy a small farm or large smallholding. I had a profession job before this which I did part time for the first few years in this business but haven’t done for a while now and the thought of going back gives me the heebie jeebies!! It was a very rigid and stressful job with no work from home and unless I worked full time I’d be worse off financially and unable to do school drop offs and pick ups. I would definitely work out something else to do for a job if I have to but I do really enjoy my work now, which I have not always felt about jobs by any means!

Thank you, this is really interesting to hear and food for thought….

1-2 hours is nothing, we go for Sunday lunch regularly at my parents 90 mins away and many people commute that daily. If care needs arise being only that distance will be a huge plus. If your siblings are resentful and the estate is likely to cover at least similar amounts then go for it. You could always get a clause put into the will that if there's not enough to split between your siblings then you get nothing.

No point taking the cash if you have to move 1-2 hours away anyway.