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.

Everyone questioning if she'd rather lose the money or her sister - doesn't sound like they have much of a bond anyway! She was left to sort out her father's care arrangements herself, her sister has only shown interest now that she assumed there would be something in it for her, and is more than happy to accuse her sister of stealing from their father - hence the audit.
She also didn't save what she would have paid for two sets of school fees. She's made it clear they fully decided against it. She wouldn't have been spending anything on fees.

Yep, that just about sums it up!

If your dad wanted your sister to have half the 300k, he would have given her half - for a deposit or something. Nothing stopped him from letting her stay for free in his property either, without her risking to gamble it out.

If he wanted to, there were lots of things he could have done.

He chose to pay for his grand-kids education. It wasn't a loan.

The OP does not owe the sister a penny.

If it were me, and I had the money there, I would absolutely pay my sister. Especially if she isn't as well off or secure as me.
Simply put, I would feel it was the right thing to do.
I don't agree with her behaviour, at all. But I wouldn't base my decisions on her behaviour, I would base my decisions on what felt morally right to me.

But ultimately, you have to do what will sit right with you for the rest of your life.

It's not true that you'd didn't benefit from the £300k and your father also believed you were benefitting from it because he accounted for the £300k given to you in his future plans - he also wanted your sister to have £300k and the rest would be split equally. Your father's wish was for both of you to benefit equally. You should work out what the total of his estate would have been had he not given you the £300k and divide it equally. That would be honouring your father's wishes.

People are so short-sighted - this is nothing to do with whether the OP benefitted or not.

It seems very clear that your dad desperately wanted everything to be equal between you and your sister. And that he was a very generous soul.

You are attaching a lot of your own moral judgements about your sister to your decision making, but don't seem to be thinking at all about what your dad would have wanted.

If he had thought for a second that he wouldn't be able to make the finances equal in his will, do you think he would have gifted you the £300k? Because it doesn't sound like it. It sounds like he wouldn't have given a penny more than he could match for your sister.

Try and understand it from her perspective. She's completely had the rug pulled from under her, with the additional emotional aspect of having lost her dad and feeling upset that things have been left so unequally between the two of you. She is really hurting and obviously very worried about her future.

Think about what your dad would want.

. It doesn't matter what the OP had in the bank. That's money she could have chosen to spend on ski holidays and champagne for all it matters. Could have been £20 or £200,000.

The Dad spent £300k of his own money on School Fees for his GC.

Then essentially gifted £300k to DD2, to spend as she saw fit.

OP was then to receive 50% of what was left. So, DD2 would have ended up with £300k more than OP if all had gone to plan.

Unless, OP was gifted £300k, which she then chose to spend on fees... which isn't what she said happened? She insists he directly paid for fees? E.g. he transferred 100k x 3 to Poshington senior School ?

You did benefit. Your children went to a better school, now have a significant head start due to this.

Nope - honouring the father’s
wishes would be to give the sister the first £300k of his estate and to share the remainder.

300k went into the OP's family's benefit. None went to her sister. In what bizarre world is that remotely fair?

I wouldn't give her the money and if I was her, I wouldn't expect it either! That money was given freely by your father for your children. It was not for you. You have benefitted as you didn't have to pay school costs. She has never had to pay school costs either.

She knew of the arrangement, she knew it was on the basis that there was money left to inherit. If she had a problem, she could have insisted on £300k then and had the conversation with her father.

She wants £150k off my husband and I to make it "fair"
It comes down to what’s more important to you. Keeping £150k or the relationship with your sister. That’s up to you.

Absolutely no relevance that she was in a relationship. Your children have benefited to the tune of £300k
You need to come to an agreement with your sister.
This is shocking tbh that you seem to see no reason in this situation

YANBU. Your dad was helping his grandkids. She didn’t have any. So she didn’t need that money. And like you said, his decision. This is like people saying, “I’m childless but I need flexible working too.” Nope. You don’t. Not unless you have a very valid reason e.g. health. I can’t stand it when siblings expect something but didn’t help with the care or visit. The pressure of being the POA is immense.

Unless, OP was gifted £300k, which she then chose to spend on fees... which isn't what she said happened? She insists he directly paid for fees? E.g. he transferred 100k x 3 to Poshington senior School ?

She was gifted £300k with the agreement it was for school fees, she accepted that is what she wanted to spend it on. The DF paying directly to the school was to dodge IHT and deprivation of assets for care home calculations. It wasn’t because it was a gift to the grandchildren.

It is going how I thought! I'm genuinely not a monster....

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.

I'm also looking for words to use when talking to DH. He was never really that wedded to the idea of private school. We've planned our lives based on a certain set of financial assumptions and I'm now considering giving away most of our savings (that were predominantly contributed by him) while we've still got 3 kids at uni to compensate my sister for dads poor financial decisions. She'd have most of her £300k without the loans and the losses made by the flat.

No way on earth do you now need to deprive your kids from help because your sister suddenly woke up.

I know quite a few families whom I would actually describe as deprived.

I won't tell you the exact number of them where the children all went to private school and their parents have considerably more than £150K (remember: that's only 'a huge chunk') in savings and they will own a (presumably very desirable) house outright in five years... but suffice to say the actual number is fewer than 1.

@barenakedhazy why don't you reframe the £300k as if it was a loan that was meant to be paid back out of inheritance when he died. Eg. If he'd died with £500k left, you'd have paid back the £300, meaning his estate would be £800, shared equally between you and your sister. £400k each. Effectively leaving your sister with £400k and you with a net £100k.

This is what he was effectively saying when putting his will into place.

Now do the same with zero instead of the £500.

You pay back the 300k, and then you split the total inheritance two ways. £150 each.

To get to this same effective position you give your sister £150k.

I think this would be the fair thing to do. It's clear he wanted you both to benefit the same - it's just he gave you your share first.

I think the right thing would be to give your sister £150k.

Could you not do something that helps your sister but also benefits your children after she dies?

You’re being terribly unfair IMO. You are both your father’s children and should be treated equally. It’s what he said and intended.

You were lucky enough to get the inheritance early when it suited you. He didn’t come up with the idea of school fees on his own and you could have said no.

You should tell your children that their legacy is their education - they would be extremely fortune to get a house deposit too.

If the £150,000 is too much of a stretch to you ( although fair in my opinion), is there a figure that would be more acceptable to you and would make a difference to her?

You’re not painting yourself in a good light here.
You could have afforded to pay for 2 DC, not 3, but for some reason your DF paid for them all to the tune of £300k. Instead of saying ‘is ok dad, we can pay for 2, it would be lovely if you could pay for the 3rd’ you use took his money. That £300k which he paid upfront could have generated a pretty penny in interest over the years the children were in school too - which he missed out on. He promised your DSis the equivalent once he died, but sadly, as is often the case, most of this west in care home fees. I wonder if he would have made the same choice knowing that actually your DSis would get nothing?
You massively benefitted by saving £200k in school fees, have decent pensions and over £150k in savings. You are very well off compared to most people. But you're more than willing to shaft your DSis.
Try to imagine putting your own children in a similar position in years to come. Your DF thought he was being fair in his own way - you’re happy to override his wishes and lose your relationship with your sister. Shame on you.

I did put on my hard hat!

Your father made his wishes very clear as in the 300k was not a gift to your children and that it was you getting some of your inheritance early. He explained that clearly when he said that your sister gets the first 300k and then the remaining balance to be divided between you. Your children have been privately educated on you getting your inheritance early and then you want to give them some of your savings for their house deposits? Let them save up for their own deposit like most people do (including my children).

It doesn't matter what went wrong with the bad decisions over the latter years, noone can forecast what the future holds. The remaining money has gone. Your sister is still owed at least 150k to make it fair, as your father wanted. Whether or not you do the right thing or not is up to you. Personally I would not be able to sleep at night knowing I had benefitted greatly and my sister had not had a penny.

You have benefitted so do not hide behind your children with that one. You and your husband changed jobs to make your lives easier and have managed to build up significant savings.

If OP hangs onto the cash, the DF will have disinherited DD2 cos he didn’t like her.

To OP’s benefit.

No wonder DD2 needed rehab.