DH has just revealed that he has nothing to show from 30k inheritance

[Booboomylove]

My DH and I have been together for 5.5 years and married for just over 6 months. We both own our homes and he moved in with me after a year together. His house is currently rented out. I like to think that I’m quite good with money eg getting the best mortgage rate etc, however he has ‘owned’ his home since 2006 and only ever had an interest only mortgage, on a variable rate which has sky rocketed over the last few years. The house is now rented out which at least covers the mortgage and we are going to cut losses and sell.
Last night we were talking about inheritance as a blended family and he said he thought it would go 3 ways between his adult DS, my teenage DD and his DS’s son (age 8). I said no that’s not right, your grandson will get his inheritance via your son, I didn’t get anything directly from my grandparents, did you? DH said yes 15 years ago I got 30k from my Nan!
We have been together 5+ years and I didn’t know this, also we have always discussed how skint we’ve been in the past and it’s like a shared experience that we are respectful of.

Anyway, he is refusing to tell me what happened to the 30k, he says it’s none of my business whereas I think it is something I ought to know about him as his wife eg is he an absolute idiot with money? He’s gone to bed in a mood.

what a classic MN thread, utterly polarised viewpoints depending on whether one regards marriage as the means to access the other person's money or not.

He only has 1 son. The 8 yo is grandson.

Problem is they have no idea how many gc they will have when they die. Easier to leave it to own children and they can pass down to their children.

not if one needs to skip a generation for inheritance tax purposes.
DS may be wealthy in own right and not needing inheritance so skip to gc

But it's one thing demanding to know what he did with it when he doesn't wish to discuss and another thing drawing your own conclusions based on your knowledge of him today.

Exactly this

Ok. We don't have inheritance tax in my country and I wasn't sure how much your limit was or if it included family home.It is becoming more common for people these days to consider gc in wills as people live longer and most children are set up quite well by the time parents die. I don't know anyone who has inheritance from grandparents though. Mind you, my.parents got nothing from their parents anyway as there wasn't anything to inherit.

Then DS can do a deed of variation in favour of his children at the time

The point is, a will that leaves 50% to each child is future proof. A will that leaves 33% to the two children and a grandchild is not, as one or both of the children may parent additional grandchildren and it may be tricky to update the will each time, especially if the OP and DH are poorly by then etc.

Also if leaving directly to a minor, I think you have to faff about with trusts.

I think he knows she will judge him, that's why he's not saying. She wont be able to help herself. They have 2 totally different money styles and really are not compatible financially. She needs to keep her money separate or though not sure that really works once martied.

That's going to be hard once they almalgama te their funds into one property. Maybe she needs some professional advice before doing this.

Inheritance tax is paid on the estate of the deceased. It will be the same amount whether it’s left to the son or the grandson.

I think she is coming to the realization that he may not be a financially smart partner. Their styles are very different. Doesn't mean either is right or wrong but it is something they need to address together sooner rather than later.

I think they are talking about how to distribute all money in a joint will.

Would the interest be tax deductible as it's a rental. This could be why he hasn't paid capital. Not sure about UK tax laws but in New Zealand it is.

Or he never inherited anything from his gm but just dropped it into the discussion when they were talking about inheritance to drive his point home.

this is not the place to discuss tax planning but clearly you do not understand the implications of inheritance tax where there is intergenerational wealth involved.

the mechanism by which the skip is effected is not the issue, the skipping is what matters and yes, it would need a trust for a minor, a factor that also benefits from pre-planning

Um, what?

If DS (or DD) receives the inheritance at a time when they are rich enough not to need it, better that they make the judgement call to do a deed of variation to effectively allow their children to get their share, if said children are adults at the time. Or they can receive it, hold it, gift it to their kids once they turn 18/21 etc and then live another 7 years (quite likely) thereby avoiding IHT and trusts.

No requirement for the grandparents to get involved in setting up trusts that may well be redundant.

£30k 15 years ago is not that much really and he’s right it’s non of your business how he spent his money before you met him.
I’m surprised you married this man without discussing finances first. You should have set up a trust for your son to protect the assets you took into the relationship. That money should go to him should anything happen to you. Any joint assets built from now should be split between your son your husbands child equally.

I think that as he had that much and spent it all and still has an interest only mortgage (assume with no big amount of money being saved to pay it off at the end of its term) that he spaffed it all on living life to however he lived it. As this is a long time ago then its before your time, however it does seem maybe he's not organised with money?

As for inheritance, if there is joint money and assets then you need to agree how that is split. Leaving it to the children split evenly across the board with gifts of x amount to grandchildren and any future grandchildren could be a suitable way to do it.