Inheritance - when to tell teenagers

[user1474905027]

My 18 & 19 year olds have been left a share of relatives inheritance - amount currently unknown as property not sold but could be substantial. When should I tell them?

They are both adults so presumably will be contacted directly but it is probably worth making them aware so that you can have some sensible conversations about what they might do with it, although again this will be presumably down to them if they wish to blow it all on wild living!!

Well, they are adults.

So, about now? And specify that they need to seek proper financial advice if a substantial sum so they don't want to piss it up the wall.

If it is substantial i would recommend they have a set sum for something frivolous and be serious and sensible about the rest.

And tell them to keep shtum. So they don 't do what a friend's son did when he inherited £50 k at the age of 21. He is socially awkward and told people and then was hit up for money by all and sundry (including family) and tried to buy friends. Terrible.

Before someone else does!
I would say immediately.
If the actual cash is dependent on a house sale, then telling them now means they have a chance to get their heads around it before the money arrives.
If they were 14 and you were talking about the presence of a trust paying out at 25, I’d understand wanting to wait. But these are adults - just! - who are going to see the money within months. So I’d just tell them sooner rather than later.

I’m pretty shocked you’re attempting to manage this. Your DCs are adults and have a right to know now, you need to tell them before someone else does.

@PegasusReturns

I’m pretty shocked you’re attempting to manage this. Your DCs are adults and have a right to know now, you need to tell them before someone else does.

IME (two separate people) who got inheritance at 18 years old both absolutely pissed it away, and later regretted not having a sensible shoulder to lean on for advice cos it should have bought them a house!
In my will it's stated that no one gets it til they are 25 because of that experience, unless an executor agrees.

Op, you're right to be wary. I hope your kids are sensible

@PegasusReturns I agree, this is overbearing.

I disagree entirely about telling them. They are adults and will be notified officially in due course. It’s really not your business to be telling them.

i'd counsel them about pissing it away. a bit of a heads up and a game plan for long term enjoyment.

I inherited some money at a similar age - £1000 from a lady who had been very close to my family as a child but not a relation.

The solicitors contacted my sister and I directly. This lady had mentioned it to my Dad but 12 years previously - it wasn’t something he’d thought about much when she died as she’d been in care for so long.

Have they not yet been notified directly?

When my DC were beneficiaries in a relatives will (at 17 and 14) they got notification from solicitor that he had died. I had already heard from another relative but their letters made us realise they were beneficiaries. (He was a bachelor who had cancer, so death wasn’t a surprise and there had been mention already of who might be in the will).

Within the next month they got a copy of the will and a letter outlining his assets.

We spoke at length about how ‘lucky’ they were to be in the will (they didn’t know this relative, we didn’t live close by so they had only met him once or twice, although my mum saw him regularly) and that this money would be a house deposit for them if sensible.

Fortunately we already had S&S ISAs set up so they have continued drip feeding the money into them, eldest (now 23) has also got interested in buying individual company shares.

I wouldn’t necessarily say that professional advise was needed, but then DH and I have always managed our own investments so are well placed to help.

And tell them to keep shtum yes, yes, yes - we emphasised this constantly but TBH, the kids tend to forget about the money on a day to day basis, apart from it appearing in their current account a day or 2 before going into the ISA every month. They definitely don’t “splash the cash”.

I have only ever mentioned it to 1 local friend, and that was because I knew that her DC had inheritances in trust. I trust her implicitly.

The only people I have spoken to at length are relatives whose DC were the other beneficiaries.

I often see comments on here about reckless young people pissing away inheritances and I am sure it does happen, but we used it as a basis for discussions about what money was needed as an adult, and generally involved them in managing it, which seems to have worked.

@AlexisIsMySpiritAnimal

IME (two separate people) who got inheritance at 18 years old both absolutely pissed it away, and later regretted not having a sensible shoulder to lean on for advice cos it should have bought them a house!

That is often the case and as a lawyer I’ve often cautioned against bequeathing money to younger adults, especially where the sums are significant.

However once someone has chosen to do that, no one has any right to try and prevent the adults becoming aware of what is rightfully theirs.

Gather investment info.. Give them options for when they get it.. My ds 16 has just blasted 2k in a few months. What a bloody waste.

Mine each received £21000 from a great aunt. Dh told them - he was an executor. Both have put it in savings.

when you or they have the money in your hands.
I don't think I'd tell mine before this.

@user1474905027

My 18 & 19 year olds have been left a share of relatives inheritance - amount currently unknown as property not sold but could be substantial. When should I tell them?

They are legally adults so should be contacted directly. Why would you need to intervene here?

My dc inherited at a slightly older age. Everything was done directly between them and the solicitor.
It was a good chunk and paid for house deposits, a car, holiday etc. They were sensible which I wasn't surprised at because they had known about it for quite a while and a long time listening to me giving lots of free financial advice

My DDs were left money by a relative and it's in a trust fund until they are 25. They're late teens now and know absolutely nothing about it!

They weren't adults when they were left it though, so prob a bit different, but I wouldn't want teens or young 20s to inherit a lot of money unless they were particularly sensible.

They weren't adults when they were left it though, so prob a bit different,

They are adults now. When the will is executed. It doesn't matter how old they were when it was made.

As the estate has a house to sell and probate to go through plus the delay of 6 months after probate granted before any distributions (the potential challenge period) its likely to be some time before they actually receive money. Recently been an executor of straightforward estate - probate 6 months after death - house sale 9 months after death (can’t complete before probate but can market) after that - first distribution (portions not whole) 12 months ad - further (the bulk) distributions 15 months ad and still now 24 months ad the estate still has final tax clearance awaiting and a residual sum to distribute.
Given this (possibly shorter but not much) timeline it becomes essential they tell no one , don’t start getting into debt etc.

DD’s grandmother gave us a sum to invest for her when she was small. We told her about the money when she was about 15. She’s sensible and over the years it was added to so that she now has a reasonable sum towards a house deposit. She’s never wanted to touch it and is very careful with her money understanding the value of it.

OP they are legally adults and unless I've misunderstood the money has been bequeathed to them and as such you will have no formal control over anything at all.

Communication and any terms over how the money is used will be directly to them.

You can advise of course, but that is the extent of your control. I can see why that may be a concern but you need to be aware that everything about this is theirs and not yours.

I think it depends a little on the amount. At 18 I inherited some money held in trust. It was about £2k and uni life was expensive so it just got absorbed into the cost of living. Being the eldest in the generation I was somewhat screwed anyway; my sister who is 3 years younger got more like £10k and the youngest person in the trust (15 years younger) got £40k. It wasn’t really possible for me to keep that money when my outgoings were so high.

At 25 I inherited another £6k executors legacy and put that into the deposit of a house we were buying and at 28 I inherited £75k and used that to extend our home.

It depends so much on the amount of money and the stage of life. For a young person I would say a car is a good thing to buy (bit a flash new one, just a reliable decent one), as it represents independence.

I hope as a young person I would have been able to leave a substantial sum to buy property, but as someone who worked 2+ jobs at uni I might not have been easily able to - I might have worked less and -partied- studied more.

My DS inherited £30,000 at 14 when my dad died. The money was held in trust until he was 18 when it had to be handed over to him. We told him about it right from the start but emphasised that grandad had left it for him to use as a deposit on a house or something equally life changing.

When he was 18 he bought a flat which he now rents out which helps to pay for his Uni costs. My DH had to go on the mortgage but we had a legal agreement drawn up with a solicitor that we have no claim on his flat. That was nearly 3 years ago. It may be one day he will decide to live in the flat himself or sell it and buy something else.

My point is that not all teenagers will piss it up a wall!

I'd tell them now, and as a PP has suggested start having meaningful discussions with them about how to use it wisely.

My DSS inherited a £40k-ish trust fund when he was 5. The terms of the trust were that he couldn't have the money until he was 30, unless the trustees agreed he could have it earlier.

At 22, the fund, which had been invested in BTL properties, had grown to over £120k. The trustees agreed he could use the money for a deposit on a house so he bought a doer-upper for £220k. At 30, he has a house worth £400k with a relatively low mortgage and a lodger. This enables him to work p/time and have a very nice life.

At the age the OP's kids are, this money, used wisely, could finance their time at uni and avoid crippling student loan repayments or get them on the dreaded housing "ladder". If it's really loads, they could buy a BTL and have both an asset that's likely to appreciate in the long term and have an income from it.

If I'd inherited a lot of money at 19 or 20, I probably would have spent it on holidays and extravagant clothes/shoes, a flash car and high living until it was all gone. I didn't get even half-sensible about money until I was in my mid-twenties.

The sooner you start having this conversation with them, the better imo.