School fees and inheritance. I have my hard hat

[barenakedhazy]

I have 3 children, currently all at Uni. My sister is child free by choice.

11 years ago my husband and I sat down and did the maths about school fees for secondary school. We had planned to send our children privately but the youngest two were
twins and while affording 2 would have been possible, 3 wasn't. We were disappointed as we'd planned for this school, but instead started looking into moving house.

When we told my dad this he made us an offer. He'd recently sold his house to downsize to a small flat in an over 50s block and he was cash rich. He offered to pay for the kids to go to school. He felt really strongly about them going and this mattered to him- more than it mattered to us frankly. To ensure their education wouldn't be disrupted he paid the school for 7 years up front for each child. This was just over £100k each.

He then changed his will stipulating that my sister would get the first £300k of any inheritance, with the remainder split between us. (Look - before people start pulling this apart it was a lot more complicated and involved- this is just a simplified summary). He felt confident this wouldn't be a problem as he owned a property he'd paid £250k for and had another £200k left after paying the school fees, as well as a good pension for day to day living.

Over the next 10 years things weren't brilliant. In summary- flat was a terrible investment which cost £50k in 5 years for leasehold repairs and eventually sold for less than he bought it. There were some mistaken investments. He helped out his sister with a loan and she then died and our cousins were dreadful and said without a legal loan agreement they wouldn't repay from her estate. Finally there was a fall that hospitalised him and left him wheelchair bound and needing full time care.

My dad died 7 months ago and after over 5 years in a care home there was almost nothing left for an inheritance.

My sister and I are joint executors and she is furious. She says I got over £300k and she got nothing. She wants £150k off my husband and I to make it "fair".

I understand she's upset and do see how it seems wrong. However we weren't going to go the private school route as we couldn't afford it- this was something that mattered to my Dad and which he did for his grandchildren. I said I see it as a gift to his grandchildren- she says she's being punished for being child free.

I was sympathetic but she's been so bloody horrible that I'm at the stage of just telling her to get lost and never speaking to her again. She's made Dad's death all about money and seems more upset that there's no inheritance than the fact that he's died. She visited rarely and had nothing to do with setting up the care home or managing the fees- I had POA and did all of that. Now she wants his accounts audited and I'm so angry at the implication that I mismanaged things.

Anyway. AIBU to tell her that she's not getting £150k off us? We do have the money as we are both in well paid jobs and she's always struggled to find her niche which I think makes things harder. She lives alone and doesn't have a lot saved for retirement which has been worrying her, so I think some of this is because she was relying on dad's money. However if she'd have bothered to get involved in his care she'd have seen the situation in real time.

@Soontobe60
"No dear - you managed to save that money because your father paid for school fees!"

Would people please read and engage brains. If dad hadn't have paid we wouldn't have sent them. I don't know how many times I need to say this. We couldn't afford it.

They'd have gone to state school, been fine and DH and I would have made exactly the same financial decisions we've made until now because we WERE NOT PLANNING ON PAYING SCHOOL FEES.

No! You spent it on your dc not yourself. Dsis did not have dc.

Your updates do paint a fuller picture... and I have more sympathy with you than I did... yup... your sister may have continued to make poor and maddening decisions if she had her share of your father's money earlier..

And yes... the money you would be giving away does also belong to your DH.

I understand your grief and anger... and yes... you are being asked to fix the mess left by your father and probably also left inadvertently by your sister's poor decision making... maybe if he had trusted her more he might have given her a share earlier... but maybe if she had felt secure / loved.. she might not have made such bad decisions in her life... who knows... I am leaping wildly to conclusions here!

I don't think you owe her.

You haven't been personally enriched by this. If your dad hadn't made this decision your children would have gone to state schools so you have the same amount of wealth now that you would have otherwise.

Your father had the right to spend his money how he chose during his lifetime. If he hadn't chosen to spend it on his grandchildren's education he could have spent it on going on annual cruises around the greek islands. His choice. It doesn't become inheritance until he dies with assets unspent.

Your sister is expecting you to compensate her for the fact that he chose to spend his assets during his lifetime. That is unreasonable.

''We had planned to send our children privately but the youngest two were
twins and while affording 2 would have been possible, 3 wasn't. We were disappointed as we'd planned for this school,''

This is what people are struggling with!

@Almostwelsh but would you really? Easy to say you would hear but in real life??
If the OP's father hadn't paid the £300k for the school, it still could have gone on care home fees or another of his bad investments. There are no guarantees that you will get an inheritance.
Local Authorities only start to partially contribute toward care home fees once a person's assets drop to below about £23k and will only pay the full fees once the assets drop to about £14k.
It's quite possible for children to only inherit a share of £14k if all the rest has gone on fees. The funeral costs may have to be paid from that too.

Regardless of how much you were the favourite child and your sister made choices your dad disapproved of, it sounds like he always intended to make things equal in the will. It's OK to have more in common with one child. It's not OK to love one more, and I think ring fencing the first £300k was his way of showing he loved both of you.

You and your DH have benefited hugely from £300k. That's not a small sum of money. Maybe you were on the fence about private school. You still took your dad up on his offer. You still benefited from it.

I don't think anyone owes anyone an inheritance generally, and if the money was gone, the money was gone... but you had a £300k advance and your sister had nothing. She's now in a position where she needs the money and you have the money. I couldn't do that to my sister.

If you didn't have £150k and your sister was well off, I'd say she should come to peace with it. But I think you and your husband have a moral responsibility to make things right with her. You're not exactly poor.

Your children don't need house deposits. They can make their own way in the world. Why are they more deserving of your father's love than your sister? Because you made them? Your kids have time to make money. Your sister is older than them and is more in need of a savings cushion.

All of your posts come across as determined to justify why it's OK to screw over your sister because you had kids. I hope you realise that with this attitude, you haven't just lost a parent, you've lost your sister. I feel so incredibly sorry for her. Not only has she lost a parent and a sister, but she probably feels like neither one loved her, and that's a horribly lonely place to be.

If you could have taken 300k (or even 150k) in hand at the time rather than have the school fees paid, then would you?

The answer to that question would be the clincher for me. If yes, then your father made a financial gift to your DC alone rather than you. If no, then perhaps consider throwing your sister 50k as a gesture. You don't appear to have a relationship with her though, so I wouldn't be too bothered in your shoes.

Agree entirely. Lots of jealousy on this thread.

OP, I'd just skim past the ones saying you've saved the money as they haven't read your OP properly.

You haven't financially benefitted from your Dad, nor has your sister.

There's nothing for you to equalise.

Does she know that you weren't going to send them to private school so you haven't actually saved any money?

It's a complex one and I can see why emotions are running high.

I'm not saying I'd hand over the money in your situation as I'm not 100% sure I would, but I think you're being a bit faux naive about the whole thing.
I think it's a bit disingenuous to say that your dad insisted on paying / you just had to take the money / you weren't going to go private. You chose to tell your dad that you had discussed and considered private school and couldn't afford it and then accepted the money upfront 🤷‍♀️. If you'd genuinely decided against private schools then surely you wouldn't go hinting to your dad, wouldn't take the full amount for all 3 kids (ie you said in your op you could afford 2 so surely only needed the top up for 1 from your dad) and wouldn't just disregard having an enormous amount of money spent on your family.

What do you think POA can do? I couldn't protect anything. Dad had assets. I can't tell the local authority that my sister wants £300k so can they please fund his care home instead.

She knew how much the home was as I told her and we looked at them together. She knew about the loan. And the loss made on the flat. And the loss made on the investments. Why the hell should I chase a grown woman in full possession of the facts and with the ability to do sums?

Im flipping baffled that she thought there would be anything left.

This is a salutary lesson in why relying on inheritance to equalise lifetime gifts is a very bad idea.

As a family I think all of you have been very naive.

Personally I think arguing that the OP's children benefited rather than her as the reason not to help her sister is a pretty weak premise.

I'm leaving the first £300k of the inheritance to the sister the intention of the father is very clear in that he saw the school fees as a gift to the OP through her children that he wanted to be balanced out.

The OP did not have to accept this gift.

I'm also surprised as the person with POA there was not a clear communication with the sister about the father's finances.

The sister may have been naive in how much her father's assets had been reduced but given everyone was aware of the terms of the will this was a very important conversation the OP failed to have. The assets did not disappear overnight and being unaware of this may have resulted in the sister making different choices.

Fundamentally £150k is a lot to give. It's also a lot not to have (especially if you thought you were likely to get £300k).

Morally I think the OP should be guided by the intentions of her father, which (unless we are missing vital information) was for both her and her sister to benefit equally from his assets. This is especially true if she is struggling financially in comparison to the OP.

But people aren't always moral and I expect that this decision will end up coming down to how much the OP values her relationship with her sister and also potentially her DH as I presume any money given would be classed as joint money that he would have a say in how it's used.

The whole situation is incredibly messy and unfortunately highly predictable (over 50's flats are notoriously bad investments), in short a lesson in how not to manage your finances/gifts/will/property.

My initial gut reaction to this is that your dad gifted each of your kids an education. The money did not go to you therefore it shouldn't be classed as inheritance and if there's nothing left, that's just tough.

Whether or not OP ^ DH or their children would have chosen to spend the money on private school, of course the money did go to them (the parents) - it was just calculated to skip a generation.

Who paid all of OP & DH's children's living costs (apart from the private schooling)?

Who is now financially supporting OP & DH's children through university?

Who are OP & DH planning to help with deposits for houses?

Of the 65 million or so people in the UK, which three will OP & DH almost certainly leave all of their money and assets to in their wills?

It's ridiculous to suggest that we have no financial interest in our children and that significant financial gifts and huge opportunities that are given to them are of no consequence or heavy vicarious benefit to us as well.

To hell with your povvo sister because she chose not to breed then.
The single tax is bad enough without family members like you! So selfish and entitled because YOU had kids.

To be clear as POA the OP has the duty to make financial decisions in the best interest of her father.

This does not include ring fencing money for her sister to inherit.

it doesn't sound like your dad would want your sis to be left with nothing.
If he had known that you would end up in this situation now with his actual decision, would he have rewritten the will to only give half of the £300k he spent on your kids?

It's Bad enough that your relationship is probably ruined forever (I don't think you can avoid that now).

You keep pulling in facts like how little she was in touch or that you want to save your wealth to help your kids with a house deposit (instead of setting things right by your sister which likely is what your dad would have wanted).

You're making clear your priorites are not anything to do with the sister.

Does anyone know how much the sister could cost the estate by auditing the accounts, etc.?

I know a family where the exact same thing happened. Brother no dc and sister had 2 dc in private school part paid by grandparent.
The rest divided equally.

People generally want grandchildren, are sad if they do not have them. If one child has their grandchildren, the private school is a gift to the children. Also, they want a legacy to go down the bloodline.

I think given your dad would have fully expected there would be money left for your sister and likely hadn't considered that there wouldn't - I'd have to give her something

Whilst it was risky - I assume your dad also assumed he wouldn't please DSis with nothing

Jealousy or possibly morality.

My mum gave me 55K to put towards a mortgage deposit in my late 30s as I'd split from H.

I have 4 other siblings.

I sold the house last year and shared out that 55K immediately between us all.

I'm on a low income and have very little saved.

I also have 3 kids who I'd love to send to private school but could never afford to. I've always known this but don't begrudge those who can nor do I begrudge those who earn more than I do.

Most importantly, I feel I did the right thing and my siblings are happy.

Your first paragraph is one of the most sensible things I've read on here and a good way of looking at it.

I am aggrieved as I feel like the school wasn't a choice we'd have made and now we're looking at losing all our savings because of dad's poor financial decisions. But he did want things to be fair and he made it clear that sis was to be compensated.
Certainly with hindsight we'd have turned down the school money.

You could have told your dad no…. You didn’t and you got 300 k as a result

But what amount would you say OP has benefitted by in actual money?

They weren't going to send their kids to private school, so they didn't save that money.

The savings they have are from their own income and her husband's inheritance.

I would not agree to my husband giving his sibling my inheritance + savings.

It would be different if he'd given them cash.

YANBU. Your dad wanted to do this for his grandchildren, it wasn't part of 'the inheritance' because he was alive and made that financial decision with HIS money. Honestly I think far too many people rely on inheritance. Circumstances change all the time.

I'm sure in hindsight you would have said "thanks, but no thanks" to your dad at the time, knowing how things have worked out. But you don't need to feel guilty about this at all. As you don't see your sister much and she doesn't acknowledge your family, it's not going to matter if she chooses not to speak to you again.

Let her have the financials audited, who cares if she thinks you've screwed her over. You haven't, you know that.

And for what it's worth, I'm also child free by choice. My sibling has DC and I would absolutely never begrudge them anything our DP wish to gift them. I HOPE they get these kind of opportunities! And I'd love for my DP to spend their money however they wish without feeling obligated to leave anything to anyone

I feel really sorry for your sister. She must feel like a total after thought. It's not about the money it's the disparity in how you are treated