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.

This is why I posted. I'm bloody furious with her. She's been rude and awful and accused me of stealing all while doing nothing to help the situation for 6 years. I recognise I'm cross which might be clouding my judgement, hence asking for opinions.

So your response to your family situation is to post the entire identifiable story on here to paint your sister in the worst possible light. She isn't here to give here side of the story. Massively disloyal. You even try and make yourself look better by saying "I'm not a monster". You shouldn't be justifying to random strangers on the internet, it's your sister you need to convince you aren't a monster, not us!

what you could do is give your sister some money and help to balance the inequality that your father created.

You've known the situation all along, but you took no action and said nothing about this to your sister. I wonder why. Your sister must feel bitterly let down and out in the cold by her entire family. This is what money and inheritance does to people.

@barenakedhazy is your sister currently on any form of benefits or is she working? If she is getting benefits, unless she can buy a property with the £150000 which is doubtful she’ll lose all her benefits and have to use her £150000 on everyday living expenses. She can’t just make flashy big ticket purchases and then claim again as that will be seen as depreciating her assets.

I actually don’t agree with everyone saying give her the money. Your Dad didn’t give you the choice of what to do with your £300000, he chose to spend it on school fees. Yes, that benefited your children, however you’d already decided to send them to state schools by this point, it wasn’t your choice. He very strongly felt he wanted them to go private and made that choice, you agreed to it but it still wasn’t your choice.

If your Dad hadn’t paid out the £300000 in school fees in one lump sum, would it realistically still have been sitting there in the bank at the time of his death for you and your sister to inherit? Or would it have also been swallowed up in bad investments and care home fees?

Are you even able to ‘gift’ your sister £150000 without there being major tax implications?

i am with you OP, life is tough and you don’t owe you sister anything. It’s not your fault that due to various circumstances the money disappeared. Your dad gifted the money to his grandchildren and that was what he wanted.

The relationship is already broken and giving her money aren’t going to fix anything. It will probably make you feel better but if you give her less than £300k she was “owed”, she will still always resent you regardless.

Whilst I feel for your sister, she shouldn’t have relied on inheritance money either - not your fault her life sucks at the moment due to her lifestyle choices - she could have chosen to work hard. It’s got nothing to do with private school fees being paid off - your dad made a conscious decision about this when he was alive on what to spend his money on. It’s his choice. The whole mentality of your sister is wrong to expect an inheritance.

I don’t think you cheated your sister out of any money - it’s simply a case of bad luck for her. I think you should be more selfish and keep the money for your own children. The relationship is broken and it won’t be mended.

I wouldn't give her anything. She's likely to spaff it up the wall with more bad decision making. Using it for house deposits is much better. Plus it's also dh money so not all yours to give.

OP, your narrative changes quite significantly over the course of your original post. You start off saying you had always wanted your 3 kids to go to private school but that you could only afford to send 2, not all 3. Your dad then kindly offered to pay for all 3 because it meant a lot to him.

By the end of your post you’re claiming that the kids only went to private school because it was important to your dad.

If you could afford to send two kids at a cost of £200k, then you can afford to give your sister her share of the inheritance. I think you are being disingenuous to claim the £300k that you received was a gift to your kids. It was clearly your inheritance hence why the will stipulated that it should be deducted from your share of the estate.

OP, if you were involved in your dad’s care and she was miles away, then I’d consider the debt paid.

If it were me, what I do would directly depend on how close I am to my sister. If I’m not that close and esp if I resent her for not helping with dad’s care, I wouldn’t give her anything.

I'd consider how much support your sister received over the years - house deposit, rehabs. And let her have whatever is left ( councils can not take away every penny) then potentially look at offering her some. So say you work out she was gifted 50k over years and she got 10k from Will. Could you offer 40k? She doesn't know your finances, just say that's what you can afford. It's still a big sum of money.

I think you should help her out. You were going to pay for some school fees and ended up paying for none… you did benefit from your dad’s generosity and she didn’t. He didn’t just pay for the extra kid. He paid for all of them which means you had extra disposable income as a result of his gift.

I suspect that deep down you know it's the morally right thing to give her the money but that you don't want to because you don't think she 'deserves it' for not being in your or your children's lives or for helping with your dad's care and I think it's this that is causing your uncertainty about what to do.

You mention that your dad judged your sister for her lifestyle like not having a steady job, dropping out of Uni etc but this is exactly what you're doing too. It's not really any wonder she didn't want to help care for a man who had made her feel inadequate for her life choices.

I would feel really aggrieved if I was the sister . OP's family has benefited from £300 k and sister gets nothing . OP you sound really grabby , accepting far much more money than you actually needed and coming on here hoping people will validate your not wanting to pay your sister a bean .
This talk of you not benefiting is disingenuous because unless those children squander their education they will get good jobs so you'll always have a safety net for them to help whereas your sister will have no-one .
I don't think you come out of this very well at all tbh

I would help my sister with some money because I love her and would not want her to struggle while I am comfortable. I would also want to make things as fair as possible. But not necessarily 150K though. That is a lot of money and since it is also your DH’s money and inheritance, it is not fair to him if you gave it all away. So depending on how much you have in your savings pot give your sister what you can afford.

Completely agree

How much of the savings are from your Dh’s late mum? What about dividing the remainder by 2 and giving half to your sister? It doesn’t have to be 150k or nothing, you can just give her a financial boost.

I do wonder why people start these posts though because they just become so defensive and double down on their original position.

I feel for your sister though, even your cousins benefitted from him before she did. He should have never given you 300k up front and at the point that he went into the care home, you should have had a frank discussion with her re the fact that it would eat away at all the intended inheritance. It’s easy for you to say that you presumed she knew but you were much closer to the situation and it was obvious she didn’t. Maybe you didn’t want her to suggest that he didn’t go into care.

Your dad has really screwed up and this is a rubbish situation for both you and your sister. Personally I would compromise and give her say £50k. This will probably be the worst of both worlds as she'll still be furious, but I think it's what I would feel morally comfortable with.

But you did benefit, all that extra money meant the money you would have had to pay out for school fees instead went into your holidays, savings, etc.

This is the very reason that I talked my Dad out of paying my sister a lump sum before his death (she didn’t need or ask for it, he just wanted her out of the will) and leaving the house and proceeds to me and my other sister after my mother died. Nobody knows what will happen in the future, much better all three of us are on a level footing when it comes to it. You should have had a bit of foresight.

OP, just keep saying “I’m all right, Jack” and be glad you got yours. Rub your grabby/grubby hands together and tsk/tsk at your sister’s bad life choices.

This is quite the topic eh !

OP, I think it's not actually down to you to adjust for your Dad's choices. He did choose to aid your DC and was honest and open at the time. Yes he wanted to adjust in the will for Dsis but everyone knows care homes are expensive and she also knows about the loan.

So I don't know how she's plucked 150k out of the air as the "amount" that will satisfy her but I'm worried that she's going to always resent you unless it's the actual full amount of the perceived unfairness

However I get your side, you would have made different life choices without that money and it's a joint asset not just yours. And you also need it for yourselves. Where I think you are misjudging is the need to gift your kids house deposits. They got the leg up with the education help so I'm not sure whether they truly need the extra help (maybe the SEN DC I don't know).

So I would offer a token to Dsis, but not 150k. I think she needs to take on board that it's not all your money but DH's too and wiping out your savings is not a sensible thing to do. So if you can afford 50k then give her 50k but I think she's just grieving and frustrated with her life choices and was clearly relying on this inheritance. There's also no guarantees that she's going to use the money wisely so I'd just be wary of giving her everything you've saved

@barenakedhazy I’m on your side but have a few suggestions. Legally (and I’m a solicitor) you don’t need to give her anything.

I completely understand that but for your dads choice you would not have gone for private school.

I absolutely would not discount the £15k deposit money given 20 years ago; could you work out the net present value of that money if it was put into property that is still held? I also wouldn’t give up on the loan to your aunt : that is your sisters money your cousins are holding on to.

I can see how she is upset. My DF wanted to give DB a very large sum of money for a house deposit and said it would be made right in the will for me (potentially 30 years hence). I said that sounded too risky - for the reasons outlined in your scenario! - and instead opted for small annual payments over 15 years. Had things gone the way as it has for your sister I would have been devastated.

as others have said it depends on whether you want a relationship with your sister and if you will feel regret and remorse about the situation.

i wonder if payment a smaller sum of money say £75k over 10 years would be more manageable for you and be some kind of compromise (also mentioning the NPV of the £15k house deposit investment from 20 yrs ago) . I’m mindful you’ve said she’s been to rehab and has had an unsettled life ; I have had family members in this situation not cope will with large sums of money at once

I think your Dad made a choice to spend on his grandchildren’s education. It’s unfortunate your sister is in this position but not your fault and not only due to the private school fees.
Your duty is to your nuclear family and your children. Absolutely do not give your savings to your sister.

The key issue seems to be whether the payment of the school fees was a gift or a loan. If a gift, he may have thought that as the sizeable amount would impact on the size of his inheritable estate, he would balance that out in the will. If a loan, he would have thought you would pay him back, upon his death, through your inheritance.

If it was a gift, I don't think you owe your sister anything. It's unfortunate that the inheritable estate was smaller than your Dad anticipated, but he decided how to spend his money when alive, which is how it should be.

If it were a loan, I think you should pay your sister back, which reflects paying your Dad back, as he hadn't intended to pay for your children's schooling.

You could of chosen to just accept the money for one child and insist your dad gives the same to your sister ..but you are did not
You owe her

I wonder what people would be saying id OP had no savings. Would they expect her to take out a £150,000 loan to give it to her sister?

You're the golden child. She's not. Life seems to have been very easy for you, for her, not so much. However you chose to deal with the money situation, the sooner you both accept your roles and move on the better. Believe me, I speak from experience.

You've asked a question on here to see what others think about you either giving your sister money or not. I think deep down you were hoping that the comments would reinforce your true view that you shouldn't give your sister anything. Initially you said you were planning on your children going to the school and would have been able to pay for two of them but not three so on that basis you decided not to send them. I agree that you couldn't send only two of them. However, if you could have afforded to send them all or had two children, they would have gone. Your father has provided your children with this opportunity that you wanted to be able to do yourselves.

I see it from both sides but morally I think you should pay your sister and stop making excuses about her lack of input whilst your fathercwas alive especially when 150k is only a large chunk of your savings and you only have 5 years left of your mortgage, you can start saving again, morally you should give your sister at least 100k if not 150k.

To be honest I think your sister is a vulture and a disgrace.