To give or not to give DD the money…

[Youdontseehow]

That is the question!

We came into a bit of money 2 years ago - 100k. We decided to give DS and DD 40k each to get on the property ladder. DS bought a flat about 15 months ago using the whole 40k as deposit.

DD (26) is aiming to buy a flat with her BF (boyfriend) at the start of next year when both their LISAs can be accessed.

BF will have 20k so they’ve decided it’s fairer to both just put in 20k each as deposit. DD has 10k in her LISA plus the other 30k in my bank account.

She’s now asking if she can have that 30k transferred to her so she can put it in her own high interest account.

So here is our dilemma (DH and I). DD is a bit of a spendaholic. She loves buying things for others too - random gifts, flowers etc. But she has been slightly better recently eg “only” spending £100 online for clothes instead of the £200 she wanted to spend. She’s also started diarising money in/money out sort of thing.

I want to just give her the money as earlier discussed (although we thought it would all be going into property deposit) with the caveat that if she’s fritters it away, she’s getting no more from us (she knows we have significant savings ourselves). DH however doesn’t want her “wasting money on shit” and for us to keep it until she’s actually bought a flat so she can use it for fees, furnishings etc.

What do you think? would you give her the money now or keep control of it? (I’ll try to put it in a AIBU format!)

YABU - she was promised the money and she should be trusted to spend it wisely

YANBU - she’ll fritter it away so keep control over it

Look, maybe 40k is chump change for some on this thread, but for the rest of us 40k is a lot of money.
More to the point it is your money not dd's and you were very clear that it was for a deposit. You made no promise to give her 40k for any old shit.
You can absolutely choose what you do with your money.
Imagine how damaging it would be to your relationship if she fritters away 20k. I would literally weep with anger and sadness if one of my DC did that. So if there is even the slightest risk of that outcome then stick with your plan to give money for a deposit and nothing else.
As a side note get your daughter to see a separate solicitor to protect her interests in a house purchase with partner. There is a big legal difference between tenants in common and joint tenants in terms of ownership. You and she really really need to understand this. She could easily protect her higher deposit proportionally and legally so "fairness" is a red herring.

This.

I think it's completely reasonable to withhold it for the house, as it was specifically for the purpose. I don't really understand the posters saying she's an adult etc - you didn't agree to just give her money. In every case I've known, where parents have contributed to a house deposit or similar, they've made that payment at the time it's needed.

I agree with this. We had a Declaration of Trust drawn up (UK) between me and my husband when we bought a property before we were married as we contributed different deposits. Dissolved it (if that’s the word) once we were married.

You earmarked the money for her specifically to buy a property so I think it’s fine for you to stick to this.

It’s very controlling to give her money but only on your terms. What would happen if she put it all into the deposit for the house and then sold it next year, would you insist on it back until the next time she is making a purchase you deem worthy?

Give the gift without strings or not at all.

Give it to her but be firm with yourself that you won’t replace the money. When ds graduated Uni we gave him 20K that we had saved for him over the years. We figured if he did fritter it away it would be a valuable lesson, better at 20 than at 40. So if she fritters it away, well, too bad. She’s an adult, time to grow up.

I don’t see anything wrong with insisting it’s to go towards a house deposit?
You were clear about that from the get go, it’s hardly unreasonable.
The “she’s an adult” responses are baffling. It’s your money until you give it to her, and it would be foolish to do that knowing she’s extremely likely to fritter it away on rubbish.

Out of interest had your son saved any money to add to the deposit or did he just use the money you have him?

I’m not sure I agree with people saying it’s controlling. This isn’t the DD’s money. This is OP’s money which she offered “to help get her onto the housing ladder”.

We moved house recently, into a bit of a doer-upper. And DH’s parents very generously offered us some money towards the renovations. We wouldn’t decide to spend half that money on the house, and then ask for the other half for us to just have and spend on whatever. They’ve offered it for the renovations, so that’s what it’s for.

I think the DD is a bit mad to not just have a larger deposit and have it ring fenced from her partner.

I think this.

She’s got to learn somehow and some day.

I don’t think you can hold it back, or certainly not without having a conversation with her and getting her agreement.

Edit - the ideal thing might be for her to put it into the flat purchase and get her contribution ring fenced as others have said.

I think if you try to exercise control over her, you will lose her. What do you want?

My parents gifted me money when I bought my first property with my now DH. They did a declaration of trust. It doesnt make sense to have a higher mortgage than you need to. The extra money she saves on mortgage repayments she can spend how she wishes. If I was in this situation with my DC I would stipulate these were the terms of the gift.

Don’t be so dramatic, ffs 😂

@Pezdeoro41 Tbh, I don’t think there’s a “wrong” answer to this, they could wait until their DD is ready to buy and give her the money towards the deposit.

What's I’m finding surprising is that they believe that a 26-year-old can’t manage their money properly and will fritter it away. Unless there’s a back story such as problems with credit card debt, for example. She says that she wants to put it into a high interest account and surely that’s what she’s going to do?

My DD (20) controls her own money. DH and I are involved in her university finances, but she’s in charge of her savings from her jobs and birthday gifts. I know that she moves it around to get the best interest rates, because she’s told me. Surely a 26-year-old can be trusted to do the same?

She's not 'controlling' her, she accepts she has no input over how her DD spends HER OWN money that she earns herself.

This isn't 'her own' money though, it's still OP's money. So she absolutely does get to 'control' it.

I think if you said it was for property only, it's absolutely fair to keep it until she's ready to buy a property.

Otherwise your son could come at it from the opposite angle - if his DSIS was allowed £40k to treat herself on whatever she wanted why was he only given it on the condition he used it for a deposit? Perhaps he felt rushed into buying because that was what was offered, whereas if given completely free reign he might have liked to treat himself to a nice holiday or new car before tying himself up as a homeowner.

If she's working anything more than a day or two a week (i,e, a basic rate tax payer) then £30k in her high interest account will definitely tip her over into paying tax on the interest, does she know that?

I was your daughter and I vote you save her from herself a little longer.

She will eventually thank you for it.

I frittered away so much before I really got to grips with money. It sounds like she's making progress but not all the way there.

Of course they are - but this isn't them trying to control "her" money, this is them buying something specific for her.

She's 26, you've given her brother 40k.
You said you'd give her the same, if she wants to spend half on a house deposit to match her BF contribution then that seems fair so they have equal stake in house.
But I would give her the money extra 20k so both her and her brother have benefited from the same amount.
She can save it, spend it on furniture, home improvements, a wedding, but I think you have to let her make her own decisions, she's 26, working and buying a house.
If you give her less than her brother it will cause resentment and bitterness.
You have to trust her and let go.
But I would say to her that this is a one off opportunity to gift her such a sum and there's no more after this so use it wisely.

This is the answer. Higher equity will unlock lower interest rates, using a declaration of trust means her money is protected. It also means she can't piss it up the wall.

@Pezdeoro41 I don’t quite understand what you mean by “of course they are” but as I said, I don’t think there’s a wrong answer to the OP’s question, either approach is fine.

But I do find it concerning that their DD isn’t able to manage her money well yet.

But if the original agreement was "I will fund you to £40K as a property deposit" then it's fair to argue that the criteria is not being met if the DD wants half of it for the deposit and the rest for anything else... that wasn't the agreement.

If a parent is prepared to gift a sum of money such as £40K for a deposit, the mortgage company offering the loan to the mortgagee will want a written and signed declaration that the money has been gifted and is not a loan. The 40K is not DD's money, it's still OP's. She can argue to DD that the figure of £40K was agreed and that's what she will stick with, just as she has done for her DS.

Surely at no point did she say that DD could put any of the money towards a deposit and keep the rest, it's ALL for property deposit. It's in a sense irrelevant that DD may not be the strongest saver, the deal was £40K for deposit, end of. OP is not trying to dictate how other monies her DD has is spent, only the sum she agreed to donate as deposit.

You can do exactly this. I put in more than DH and it was the solicitor who told us that this would be advisable as we weren’t married.

The DD should just put 40k in bringing down the costs for both her and her partner. A 60k deposit is going to be better than a 40k one

You inherited the money... and you generously said you'd give a chunk to each child to help them with their property deposits. It's your money that you are gifting her for a specific purpose.

I don't think its infringing her adult rights, since if she does fritter it away on crap, she won't have the money for the deposit...

I also think its a bit complaisant to say... if she fritters the money away , its up to her and its the only way she will learn. Why should you give up a chunk of your own inheritance, which you could spend on yourself, merely to watch her fritter it away? and then see her distressed for the lack of it in the future...on the grounds that "That'll larn 'er" That seems ridiculous to me.

You are not controlling her money that she's earnt. You are putting a condition on the gift of your own money.

She wants the money way in advance of purchasing the property. I would remind her that is what your gift is for and that its not for other purposes. It is irrelevant that her brother has purchased his property before she has. They are both being treated equally in that the money will be made available when they are ready to purchase.

Lots of good advice here on ringfencing her purchase.