What to do with money saved by my DM for her grand children (now young adults)?

[LindorDoubleChoc]

My DM has been incredibly kind and generous and saved about £14,000 for each of her two grand children (both my children). They are her onlies and she won't have any more.

She's been putting money away since they were born.

They are both now over 18 and so the money is theirs. But I worry if I just transfer it to their bank accounts it will get frittered away. Atm neither of them need £14,000. One has just this month started Uni and me and DH are supporting him with rent, one is working abroad and earning enough to pay rent and live reasonably comfortably.

So - with their agreement - it would be great to save this towards something meaningful, possibly a property deposit. If they agree, where can we put this money for maximum benefit over maybe 3 to 5 years?

And also, would you want to do something similar with this nest egg for them or would you just let them have it with no restrictions? Given their circumstances?

It depends on how sensible your children are.

A relative left money with us for three underage cousins , two of them researched for themselves when they got to 18 , put the money into a LISA and are now home owners. This is what the relative wanted .

The third cousin went through a difficult phase and as it was the relatives wish the money was used for a house/flat deposit we kept hold of the money .

Eventually we felt they were old enough and past the most difficult times and we handed over the money telling them what the relative wanted it used for. It has now all been spent on holidays etc and they are living rent free in another relatives house.

It was difficult because we felt we had to try to honour the relatives wishes but there came a point when the cousin had to be free to make their own decisions with the money, even though we knew they were not going to be wise ones.

It just sensible though to ensure that your will covers everything. Nobody wants to think that they will go under a bus tomorrow, but it could happen. In the past few years I have seen 4 people aged 40-50 something, who all died in sudden/unexpected or tragic circumstances.

Too many people equate wills with old age, but in reality you should make a will as soon as you have anything to leave anyone. I made mine when I bought my first house, and I was single then, no DC and have since updated it after marriage and again after divorce.

I also work in an industry where I have seen so many problems caused when people don't have a will, or haven't updated it to reflect current circumstances. You can't always depend on other people to do the right thing either.

If the money is in OP's name and not the DC name, then OP needs to protect the money for her DC if she doesn't give it to them now and if it remains in her name, then she needs to specifically put in her will that they get £14K each . Her will could currently leave everything to her DH for example.

Completely torn on this one. I was hopeless with money until I was about 30 and would have wasted it. DD 16 has a considerable amount due to generous grandparents and an inheritance that she is solely responsible for. She works a minimum wage job on Saturday while at college and has never touched her capital. You know your own children best.

Thats madness. Thats what my brother did when he received his gps savings for him!
I was smarter and put my kids saving accounts in my name. So when they are 18 they can have a small part and if that goes well they will get more. Or if they need it for something proper.
My brother regrets it so much that my parents didnt control more, but they couldnt because it was all in his name.
I had the same and my sister and we were very sensible with it. But it can go really wrong.

Not everyone can be trusted with money. I knew someone who had a house bought for them outright. So they went and mortgaged it to the hilt, spent it all on cars and holidays and then ended up losing the house.

What did your mum save it for for?

I would get them to invest a little.

I’m in a similar position with similar amounts but my late dad made it pretty clear it was to get them on the property ladder. Did/does their grandmother have a stance on the matter?