If you claim/win compensation on behalf of your child, can you spend it?

[smellysocksandchickenpox]

Hi. Am currently going through the process of making a claim on behalf of my child's accident. If we win, can we just pop the money into the family bank account? I don't like the idea of him getting a lump sum at the age of 18, would be more beneficial to spend on him when he's a developing kid, but can we? or does it have to go into some sort of trust fund?
Thanks

No. It goes into a Court held fund that they have to apply to for the funds once they are 18.

It's held by the Court of Protection until your child is 18 and they then receive the full amount at that point (they are an adult at 18 so you will have no say in them receiving the full amount, just make sure you explain once it's gone they won't be getting any more for as many years as possible)

You can apply during their childhood to release small amounts of the funds but they have to be exceptional circumstances such as university fees or to pay for a school trip that they would have to miss out on if you didn't have access to the funds.

In my dd's case it was to purchase her musical instrument. You can't use the money for clothes/toys/holidays unless you are struggling yourself to be able to afford those things.

Ask your solicitor to set up a personal injury trust with you as the trustees. It will be less hassle than having the money in court and you will be able to access funds early if required for DD's benefit. The court will probably have to approve the trust.

good info, thanks folks.

Really? I know nothing about this, so I'm sure you are all correct, but I am v surprised. Surely it is to be used to help the injured person, with everyday living things that they wouldn't have needed if they hadn't had the accident. And those things cant always wait till they are 18. What an odd system.

Kojackscat any additional help the child needs through their childhood is paid for by the other side through the childs lifetime, money awarded as compensation goes into a trust.

Ah, I see, PottyLott, that makes more sense.

The money can also be used towards any needed adaptations to the house, car etc
and can pay the difference between a basic holiday and one that can cope with electric wheelchairs for instance
BUT
the purpose is to last the lifetime of the child, not to enrich the parents
(the claim I saw was £5.5 million 16 years ago)

Why don't you like the idea of a lump sum at 18yo?

I inherited some money as a kid which I couldn't have until I was 18yo. My parents strongly suggested I didn't touch it until after uni and I listened. Then bought a house after I graduated and started my first job. So I was very lucky I got on the housing ladder at 21yo without having to save for a deposit and before house prices went crazy.