to want to pay off the mortgage instead?

[onnwt]

I was gifted 100k last year. Dd is due to start school in a year. My parents (who gifted the money) are ‘very sad’ I’ve decided to use the money to pay off half the remaining mortgage instead of towards school fees.

They said they assumed I would keep the money until she started secondary (and presumably add to it between now and then) or I would use 10k a year from the 100k and spend my own income on the rest of the fees per year if she was to start age 5. They’ve said I can do what I want with it but they ‘assumed I wanted dd to have the best opportunity in life.’

My outstanding mortgage is 208k. I would love to pay it off to under 100k as I would then realistically be mortgage free by 45 (I’m 32). I’m now second guessing myself as I do have a healthy income and could feasibly just pay the fees from income alone. I wanted to enjoy life though. For context state schools round here aren’t they best but aren’t the worst either. I’m now feeling like a shit mum and also even worse as DS’s dad has zero interest so this decision totally rests on me. WWYD?

So it wasn't really a gift then? It was money given with expectations and an attempt to control your daughter's schooling?

You do what you think is right for yourself and for your daughter. Paying a lower mortgage will also benefit her as you will have more money for other things every month.

Your parents were a bit silly if they didn’t tell you what the gift was for.

They should have just offered to pay the fees if that’s what they wanted. If they give it to you as a gift it’s a gift - YANBU to assume you can spend it as you like!

I’d go with the schools fees every time particularly if you have a healthy income where you probably pay them anyway so could pay down your mortgage quicker anyway.

I do understand this is a personal choice and I value education above pretty much everything else as it gives options to children. That said if you have anxiety over the debt, or no back up savings, or would struggle to fund later years these would all play a part in my decision.

Is there a need to be mortgage free by 45? Would that be better for you as a family? Only you can make a guess at it. Either way sounds like you are giving your LO a great start in life!

Surely £100k invested in a risk-free vehicle will earn less in (taxed) interest than you will pay in interest over the next eight years? So you are saving a significant sum by paying off the mortgage, which you can save for when your DD goes to secondary school.

You can then assess for yourself what your DD needs, where she will thrive, what you can afford. Even without inflation, £100k might not be enough.

A lot changes in 8 years, and who knows what Starmer will do?

What if you paid £50,000 towards your mortgage to reduce your monthly outgoings now and keep the remainder back until closer to when you have to decide on secondary school..? Things can change in education quite quickly. You might find that the state schools around you are better at that time in which case use the remainder to pay off the mortgage, or you may feel you want to go down the private route.

So it was a gift with strings.
I would pay down the mortgage, so that you can reduce the monthly cost, make it more affordable. Then use the money saved to pay for additional education or clubs or whatever other activities you can't currently do.
£100k won't even touch the sides of private education in a lot of the country, especially if she is not even school age yet.
Or move somewhere the schools are better than not just shit. Which may mean a bigger mortgage.

Was the gift for you or your child. It feels you think it was for you and they feel it was for your child.

Your mortgage is £208k, the gift is £100k, so you'll have £108k of the mortgage left if you used the £100k on it. You'll be shortening your mortgage term and decreasing the amount of interest owed on it, and you'll be mortgage free much earlier than 45.

On the other hand, you could pay for a private education and still be paying whatever you're paying on your mortgage now.

It's a tough one.

If I had £100k, I'd be able to pay off what's left of my mortgage and buy another property, and that's personally what I would do.

Good luck in whatever decision you choose.

What you on about, 100k will give most of secondary education years if not all, at 15 -20k a year.

What did they say when they gave the gift? Specifying it was for a specific purpose after the fact is a bit silly. If they want to pay for private school fees they should have just offered to pay, rather than giving a gift with strings attached

State till secondary?
Overpay mortgage whatever you are allowed to
How much would overpaying by 100k shave off your monthly repayment. It might not be a great amount!

I'd choose my child's education every single time. But your parents should have said this was the purpose of the gift at the time of giving you the money and given you the choice to opt out of recieving it.

I’m now second guessing myself as I do have a healthy income and could feasibly just pay the fees from income alone. I wanted to enjoy life though. For context state schools round here aren’t they best but aren’t the worst either

I mean that is quite shit though.

School fees, every time!

Realistically, would 100k get your daughter through private school in your area? How much would it be from year 7 through to sixth form? Thats without additional factors such as trips, uniforms, hobbies, travel etc? Which are all likely to rise in cost in the next few years as well. Personally I’d pay the mortgage and invest time and money in great extra curricular activities, if (and it’s always an if) your daughter chooses to go to university, real life experience will count for just as much as a fancy school place. Plus you’ll be able to help her out a lot more in early adulthood once mortgage free.

Oh come on. Who hands over £100k with the intention for it to be used towards a childs education without explicitly having a conversation about it.

We want to give you £100k, do what you want with it
OK i will use it for my mortgage thank you

We want to give you £100k towards GC private schooling.
Thank you
Or I wont be doing private schooling but i would love to accept the £100k and pay off some of my mortgage.

More to this than meets the eyes

OP, you haven't done the wrong thing.

Private school doesn't mean a better education , or better teachers. It just means that you pay for it.

Paying off your some of your mortgage is sensible. You have more money free now for holidays, memories, and tutors.

Absolutely.

op did you know it was for your child?

Adding to this, private school fees are crazy. You'd be paying for 2 years maximum. You're getting 10 terms (if you're lucky) and then they go back to state-funded school? What are the longterm plans here? Your parents have no say over what you do with the money if they didn't specify what it was for.

How naive.

Presumably you'll be able to save as much as you pay off over your kids school life though? So as long as you do that for your DD/DS it will be fine.