Giving son £600 a month

[Krosem]

DH and I are in our 50s, we only have one child, we are mortgage free, DH is a supervisor for a HA repairs department, doesn't want to step down or leave. I work as a receptionist part time having stepped down from my previously more stressful job.
We bring home a little over £4000 a month, our outgoings are low, we don't holiday abroad much anymore and if we do it's not very expensive as we aren't restricted by school holidays.

Our son is 28, he has 3 children and a wife. They both work but aren't high earners. I provide some childcare , we take them on holiday once a year. We try really hard not to step on their toes, with the kids are they are fantastic parents.
Last year we paid for their wedding entirely, they didn't ask, we insisted and they were very grateful, I kept out of planning unless asked as it was there day.
The year before we gave them money for furniture and home decor.

DH and I have a lot left each month, sure we can save it and what have you, pensions etc. but I hate knowing my son is struggling a bit while we are cruising. DH suggested we pay for their car and the most expensive kids hobby. This will probably be £600 a month, we'd just set up the direct debit for the kids in our name and probably pay the car via them.
We are just worried this might seem a bit intrusive.

Is this a bad idea or should we do it?

This sounds so lovely ! And I would absolutely accept ‘no strings attached’ gifts from Parents and or in-laws … how fabulous

P.s …. Everyone going on about the £3k you ‘can give’ per person (so you and your husband can give your son £3k each per annum) …. You can give as much as you like to anyone in cash 😉😉😉… ‘you’ and ‘your husband’ might just have an extravagant lifestyle and withdraw / need a-lot of cash per month for ‘yourselves’ 👍🏻

I wouldn't give a monthly amount or agree to 'takeover' certain bills. Lifestyle creep is a real risk and if the money had to stop for any reason and they'd become reliant on it, it could leave them worse off in the long run.

In your shoes, I'd offer to make an overpayment to their mortgage each month. It might not bring immediate benefits but in a few years when they want to upsize or arrange a new fix it will benefit them enormously. You'll be gifting them freedom and choices.

The day to day bills I wouldn't get involved in - they're adults and if they wanted gym memberships and more dinners out then they could choose to go on one less holiday a year and do that - but they don't, they're prioritising their money differently.

I would be careful not to put your desires as a parent onto them. You only want nice things for your child, which I do understand - dinners and gym memberships you mentioned. But do THEY want this?

Dh and I don't go out that much. But we don't want to. We're so happy just spending time together that I'd honestly rather save the money and put it towards savings for our own dc's future, the mortgage or our family holiday. But people around us buy us gift vouchers all the time for Xmas and birthdays - tickets and meals out. Which is SO lovely of them but honestly, I'd rather that x hundred a year just went towards our mortgage! No way you can say that though.

I would set up an online shopping account with their address and pay for the groceries.
I would also pay for the children's hobbies and petrol.

You sound amazingly generous. My mother has 150k saved and a 2k a month pension, and she gives one of my kids £20 for Christmas, and nothing for their birthday, and the other £50 for each (favouritism). I get nothing. Ever. Not a penny. I'm helping her with her will. There will be about in excess of £500k inheritance tax due, but she won't give it to the family now.

We do this too for our son and daughter's young families and have done for ages. Our reasoning is they'll get it when we die so better to have it now while they really need it. I honestly couldn't enjoy expensive holidays, etc knowing they were struggling.

‘intrusive’? Give over its an incredible gift.

Me too.

You might not like this idea but if your DIL works very part time, is that affecting her career long term?

I just think that many women need to keep going (and pay for childcare/nursery) so they don't get left behind on the career ladder.

You could gift £3Kpa to your son, or more as long as it's coming out of your income (not savings.)

TBH I'd be more inclined to hand over a lump sum and tell them it's towards their mortgage (to pay it off.)

£700 a month for a mortgage is pretty low these days.

We've given our DCs a decent amount of money partly family inheritance and our savings, that they used as house deposit.

I think it's better to do that than drip-feed money as it can be a disincentive to growing their own careers in the long term.

My parents offered to pay for my children's activities and we are so grateful for their kindness! In reality it means we can afford a (modest) holiday and have a bit of breathing space!

I'd be more inclined to give it in larger lump sums to avoid the potential reliance on it in terms of income every month - i think ira a different mentalitysomehow. How long do the car payments last? It would be good to be for something specific with an end date so you can either pull back a bit or carry on depending on your situation in a few years.

It is a wonderful, generous idea and stop being silly about 'intrusiveness'. You are great parents and it is wonderful to be able to share one's wealth with the children, no matter how grown-up they are. Also, it is wonderful being able to see (alive and no memory problems) how your assistance makes them able to do what they could not have been able to do without it and they can thank you for it in life - and not wait for your demise and the windfall. One thing though, you should put away a sum of I don't know how much for medical emergencies for yourself, just in case - i.e. my mum had to go private for a cataract when she retired, etc. They are so lucky to have you!

@Krosem, DH and I both do the gifting of £3k each per year so each DC gets £2k. We split it into £1k each in May and November. My DD always pays hers off her mortgage, she has 2 DS's and when they were in nursery I helped with nursery fees. I felt guilty because my Mum looked after my DC so I could continue to work full time but I don't live close enough to look after my dgc. I would have 1 or 2 days a week if I was closer. I buy their shoes and coats and pay for their swimming lessons too. DS1 doesn't have any DC and usually uses it for a holiday for him and his gf and DS2 buys things for his home and saves a bit. Like you I think it's pointless me and DH being comfortable and our DC having to be careful with their money because of paying mortgages. DH and I are both retired now but our mortgage is paid, we have enough to pay all bills, have a couple of nice holidays each year and we eat out a couple of times a week. I do remember how hard it was when my DC were small. I just couldn't afford to give them much as DC so I'm making up for it now. My thoughts are I'd rather help them out now, and see them enjoy their lives more than make them wait until we die to inherit. We've helped out with deposits for houses too, especially for youngest D's who does not earn a lot so needed to put down a larger deposit. I love to help out my DC and DGC. They enrich my life so I want to do all I can for them.

Ignore those saying you shouldn’t do it, Op, it is nobody’s business what you do with your money.

My only suggestion is to maybe save something for the GC, eg in a S&S ISA, as even £50/mth invested now would substantially grow for them later.

We are slightly older and in a similar position to you, decent income, decent pensions, substantial investments/savings, house paid off a long time ago.

Our kids are early/mid 20s, still single, one in a good professional job, the other about to return to studying after a few years of basic job/travelling/time out for a medical reason.

We have started to drip feed money monthly into their ISAs, as it is better to give them it now, to eventually be used for a house deposit, than when we die (and there would be IHT due if we both died tomorrow).

From an IHT pov, we can afford it from monthly income, which I think is allowed on top of the annual allowance, but even if it is counted in IHT calcs, it is better to give them it now, when there is less chance of us dying within 7 years, or needing it imminently for care.

Neither child is expecting the money, or ungrateful, quite the opposite, they have seen how careful we have been with money and have a similar mindset. They both have an excellent work ethic too.

That's a really fantastic thing to do if you can afford it. I would maybe split it into some NSI children savings bonds for the kids so that they have something towards college / driving lessons / expensive shit in the future.

That's not right @MrsDoubtfire123
We're in the thick of this ourselves, working with an excellent FA.

You can give surplus earned income as a gift (and pensions count as income) but anything given out of savings will* *be liable to inheritance tax if you die within 7 years (of giving it away.)

HMRC have access to bank accounts for IHT and tax purposes so any money can be accounted for - it doesn't grow on trees so it's either earned or from savings.

If you give money away regularly to family, you are supposed to keep a record with dates, for IHT purposes and show where it's come from (ie bank statements.)

You sound like lovely involved thoughtful parents and grandparents op. My fil does similar (not quite to your extent) he pays us £150 a month to cover some of the grandchildrens hobbies, and occasionally will transfer £1000 or so to help out if we're redecorating or have a large "thing" to pay for. It makes such a difference to our lives and means we can do stuff with the kids we would struggle to afford otherwise. His reasoning is that there might be less money when he goes, but he likes to be able to see us enjoying life and helping out while he's around. My mum transfers money into savings accounts for the children that aren't to be touched until they're adults, she's more of a planner and likes to know they will have a nest egg available for when they need it. If you can afford it, and it gives you happiness to know you're improving the quality of life for your loved ones and future generations, than it's no issue at all. You sound lovely.

You said you discussed this with your sister and she thought it would be intrusive. Do you have any other family members who might feel they are in much greater need than your DS? It is absolutely nobody else's business but perhaps your DS might prefer not to have this known amongst wider family.

Why not?
We have 3 at very different stages. 1 we covered rent for 6 months and paid off some debts for. Another, we pay each month towards nursery fees and car tax. The youngest will be getting driving lessons shortly.
When we were their age we didn't have parents to help us so I like being able to share where we are. Also mid 50s with no mortgage and a good income.

It's great to help out but you need to be careful it doesn't stifle their career progression and they become reliant.

They are still very young (my DCs are 10 years older than yours) , earning good incomes and with far higher outgoings than your son (expensive areas where they live.) Mortgages well over £1k and even £2K!

Personally, I don't think giving a monthly income is good.
I said earlier that lump sums to help them pay off the mortgage or to decide how to budget everything will give them greater resilience in the long term.

@LaughterLentil

Sounds like my friend’s PIL. Friend’s DH took over family business, grew it substantially, his dad still getting significant dividends from it, parents now have more money than they will ever spend.

My friend’s DH is getting frustrated that they can’t see how much IHT will be due (I suspect their estate will be well into 7 figures). They have teenage GC, did pay some uni costs for eldest, but only for a short time.

They give a small sum per child for Christmas, saying they can’t afford more 😲. They could help with driving lessons, first cars etc, easily.

My friend and DH have also benefitted from the growth of his business, but he is frustrated that some of the profits of his hard work, will end up being lost in IHT when it could benefit GC now. He is trying to get their heads out of the sand!

I agree with this.
Have you done proper financial planning Op?
Do you retire at 67/68?
What would happen if you became unable to work at 60?
Can you bridge the gap to state/ private pension

I find it odd that you would give your DS £600 a month but his wife is very PT and he pays £400 a month on a car.
He needs to grow up and stand on his own 2 feet

My only suggestion is to maybe save something for the GC, eg in a S&S ISA, as even £50/mth invested now would substantially grow for them later.

We’ve been fortunate enough to be able to save £100 a month - from birth to nearly 18, that is now just under 35k! Which is great, and I’m not worried about our kids having that to do what ever they’d like with as they’re both sensible, but some parents might be worried they’d go mad with it.
You can start and pay into a pension for a child, if I’d known that 18 years ago I’d have given it serious consideration.

This will probably be £600 a month, we'd just set up the direct debit for the kids in our name and probably pay the car via them.
We are just worried this might seem a bit intrusive.

I wish someone would be this intrusive in my life 😂

Ignore those saying you shouldn’t do it, Op, it is nobody’s business what you do with your money

Op asked 😂

How lovely of you both 😊