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?

Surely your parents said something about what they wished the money to be used for at the time of gifting? I don't believe that they gave you the money without saying something aboout their intentions. I haven't RTWT but is 'their" money protected in case of divorce if used to pay off the mortgage?

If sounds like they should have specified.

I'd definitely pay off the mortgage, unless you fear your relationship with your parents would be irreparably damaged if you do that?

My 2 DCs went to a "bad" school for academics but a great one in that they both loved the school and the teachers were all lovely and did the best they could, while understaffed and underfunded.

Both got full academic scholarships that have covered all their university tuition fees, despite each having to opt to take online classes for the most difficult subjects in their final years at high school. We're not in the UK, but think along the lines of A level Maths and Physics. This was because the classes they wanted to take either weren't offered in their school or were being taught by an unqualified teacher (well, a fully qualified teacher, but one without advanced level knowledge of that particular subject.)

It's their love of learning that enabled them to do so well, whereas I'm of equivalent intellect to them both, but hated my high-pressure, highly academic school, and didn't reach my full potential because my anxiety was through the roof and I was too scared to ask teachers for help if I didn't understand a concept first time.

This. And it’s worth noting that interest in a savings account also compounds so it may be preferable to keep money in savings than pay down the mortgage depending on the comparative rates etc.

I completely understand your position and in your circumstances would don't be same - but I guess they're trying to recreate a part of your childhood they were happy with for your dc? And that's perhaps why they're sad. Saying they're sad isn't being super controlling, they just had one idea in their heads and you had another more sensible for you one.

I'd steer a middle course with them and say given VAT, it makes sense to pay mortgage down now, state primary and you'll evaluate private school for 11-16 or something like that as secondary is a way off for you yet.

@GreenLightgerkin

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

Thank you. I know private schools are a contentious topic on MN, but if my parents offered me 100K with a strong expectation that it went on school fees, I'd turn it down and would give chapter and verse on why. It really annoys me when people assume that the reason you haven't made the same decisions that they have (private schools, cars, houses, type of holiday, cruises, etc) is that you can't afford them. Most of my family are like that, and it is galling that their failure to 'get' what or who I and my husband want for our family has led to a certain chill over our relationships.

I would decide whether to save and collect the interest, or pay down some of the mortgage, and have a weekly tutor for your child so that through (state) primary she is able to be easily achieving her targets. It's the stuff you learn in primary that sticks with you for a lifetime (eg times tables, calculating fractions, being able to read well). You can then decide nearer the time for secondary which school/ type of school will suit best. I imagine there will be a shake up of private school provision between now and when you need to apply.

Only on mumsnet

If your parents wanted to pay for your dc's education, then they should have offered that - and you could have had conversations with them about what if you had a 2nd child in 5 years time, and about where the money was coming from for the rest of the cost, above £100K - and then you could have chosen to accept or not.
However, they didn't. They gave you the money and said it is up to you. They have no right to express disappointment in you making a different choice from the one they made.
I 100% would have gone for securing my own home / paying down the mortgage over paying for private school.
With lower (and then no) mortgage, you will be in a position to support her with paying for things like music lessons, and maybe if she needs some tutoring in a weaker subject at GCSE time.

It’s great to have the financial means to have the choice though. I wanted my DC to be at state schools but they had such a miserable time that their lives were totally changed by switching to private. It’s so dependent on your child, their individual needs, the surrounding schools etc, but to have the ability to change if things aren’t working out is so valuable.

Bit weird of them. Why didn't they keep the money and offer to pay fees out ofnit if that's what they wanted rather than just giving you it

They gave the money now to avoid (hopefully) any tax

I would 100% have used it to pay the mortgage down, especially considering the interest you will be saving over that time.
If your DD is just about to start primary then you have 7 years to save what you would have been paying for future private school fees if you choose to, but also can open up many other opportunities for your DD - holidays, trips, extra curricular activities etc which will also benefit her massively.

That's absurd, you can't pay in advance for a secondary school she hasn't even applied for yet. Most private schools have extremely competitive entry requirements.

Pay off the mortgage. The state schools will be fine. You’ll be mortgage free in ten years or so and that’s great.

@MrsSunshine2b talking about inheritance tax not vat

Ohhh! Right I see, that makes more sense, I thought they must be a bit insane.

They should have paid the fees directly they could have got a tax break

Ha! Your parents want to gift your DC something but only pay for a fraction of it and spend your income on the rest while calling it a gift to you

I'd pay the school fees

I hate when a "gift" turns out to be very much with strings attached.

Its entirely up to you how you spend the money. But a lower monthly mortgage could still benefit your child in terms of affording extra opportunities, clubs, music lessons etc.

Also, although it's a lot of money, that would disappear FAST in private school education. Plus what if you have more kids? Could you then afford another set of fees without another 100K?

Can you use it to post off mortgage, then put £10k a year into savings from now?
So by the time dd is 11 you should have saved up a good chunk ready for secondary school fees

Was the money intended for you or your child?

I would send her to state school until either end of key stage one or two, then think about private. Gives you time to save up. If you pay off mortgage you could use the money you save each month as your school fees fund. But I'm not sure how much that would be. Or split it. Keep enough for say first two years of private school as a cushion, use the rest to reduce mortgage balance.

Private school just for secondary is a lot more than £100k. So they are forcing you to stump up the difference. Which is quite different from having half the mortgage paid!

I paid for private school from aged 11yrs onwards for two children. Worth every penny, but a real grind. It’s not something to be entered lightly. Even with your parents gift, you’d be finding an additional £10k a year yourself with the way things look right now.

I think you need to have a chat with your parents about how realistic this all is. Being mortgage free or at least having a manageable mortgage will benefit you in many ways and allow you to support your DD financially more easily when it comes to extras and uni.