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Higher education

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Loan for University and inheritance

29 replies

Anyonewhoknows · 25/05/2018 14:34

My DC is due to start university this October. He received quite a substantial inheritance when he turned 18. This is currently just sitting in his bog standard bank account. Does he have to declare it when applying for maintenance loans? I have googled but can't find an answer. Have spoken to his prospective university who said it makes no difference to his tuition fees. I am a single parent on minimum wage and the inheritance is from his other parent who died a few years ago. Just want to make sure he does everything right. Any advice would be most welcome

OP posts:
Sophiesdog11 · 27/05/2018 09:32

Op, if he wont listen to you, you need to get him to talk to an advisor or someone else in the family who he may trust.

The money needs to be invested as otherwise he will fritter it and regret it bitterly when he wants to buy a house. Also, as someone else said, tell him to not discuss it with anyone.

Regarding the historic investment, trustees have a legal duty to invest money as best they can, so if they have been managing it for 9 years, and there is no growth, they haven't done their job correctly. Did they also pass him statements of where the money had been, if not you can ask for them. Again, they should have kept these as part of their trustee duty.

My 2DC got an inheritance 2+ yrs ago. DS had just turned 18, and with our advise he is drip feeding it into a stocks and shares ISA and the rest is split into savings accounts of 1-3 yrs.

DD is just approaching 18, so her money was initially under trust of solicitors, but they transferred it into trust of DH and I almost 2 yrs ago. We have it split across some 'child' accounts and again drip fed into ISA.

DS is just finishing second year at uni, and it hasn't affected his loans, as was your original question, only our income has done that. TBH, apart from making sure his ISA allowance is moved into his bank account each month, he generally ignores the inheritance.

Sadly, my niece who also inherited, died recently, unexpectedly. My DB is trying to sort out what accounts she had, but from initial checks, it looks like she kept majority in main bank account and frittered a lot of it, on holidays, meals etc.

However, her sudden death at a young age has also highlighted to us the need to have some life, and not necessarily save every penny, hence my DD has added to what we gave her for a car, to get a newer bigger car. She is having a gap year and will work so will replace the money with earnings. Its a balance at the end of the day. Not frittering it, and being aware of the need for house deposits, whilst still enjoying life when young.

Sophiesdog11 · 27/05/2018 09:57

We have also drummed it into our kids not to mention inheritence to anyone. Even my Inlaws dont know the amount, the only people who I openly talk to are relatives whose kids were also beneficiaries.

I am sure it will raise questions in future, as they will probably buy houses quicker than friends, maybe even my DDs car will raise a few eyebrows, but by telling no one, it means that they can be sure that friends are true friends.

Neither are in a relationship currently, we will cross that bridge when they meet someone and start to be serious. It seems my niece was giving her bf regular handouts. A nice lad and they seemed serious, but even so, had she lived and gone on to a house purchase, she would have regretted frittering it I am sure.

RedHelenB · 27/05/2018 17:12

Depending on where he goes to uni he might be able to buy a house and live in it and let rooms out to other students.

dolgellau · 27/05/2018 17:14

I don’t believe it will effect how much loan he is eligible for, unless the return from how it is invested is classed as income.

If it is a significant amount but not substantial then he may as well invest it somehow. If it is a substantial amount (£500k+) then perhaps he ought to consider using it to complete university debt free. Of course this also depends on how bright he is and whether there is a real chance he’ll earn £25k+ to pay back.

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