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Original poster

Inheritance question- what to do with it??

63 replies

sundaysundaysleep · 08/12/2023 18:58

Apologies if this comes across as insensitive to anyone with money worries but I can't speak about this to anyone in real life (other than DH) and thought this was the best section to ask this question.

I am due to inherit around £250k after my remaining parent died this year. It was a horrible ending and I am grateful that this money has been saved and passed on despite the awful circumstances to receive it. I therefore want to consider how to use it in the persons memory but also use it to live life and connect with adventure, experiences, life and living!

Our mortgage is already paid off and I don't have any debts (like credit card or car etc). A chunk will go to our teen kids for when they are older, and I will probably put some in my pension but what else will I do? We are def going to go on an amazing holiday at least.

WWYD? Invest? Splurge spend and enjoy? Move house? Buy a buy to let / holiday home?

Any ideas welcomed! Thank you

OP posts:
user628468523532453 · 08/12/2023 19:00

Consult an independent financial advisor. You can afford it for that sum of money.

floofbag · 08/12/2023 19:00

Would £250 get you a much nicer house ?

If you don't need the money or a better house then I'd buy a rental and put it in trust for the kids and gain an income and can sell or live in it when the time comes .

That's what I'd do if it were me as the above applies

furtivetussling · 08/12/2023 19:05

Sorry for your loss Flowers

I'm sure your parent would be happy whatever you decide. Perhaps some could go into a fixed-term account with a good interest rate, and it might be worth speaking to a financial adviser for a flat fee who could advise on what you could do pension-wise. Otherwise, set aside some for the dc, and enjoy the rest.

Frenchfancy · 08/12/2023 19:09

House deposit for each DC

Some sort of fabulous renovation you could never afford -new kitchen, bathroom or Landscaped garden

An amount set aside for several family holidays

Remaining into a high interest account for future peace of mind.

ElizaMulvil · 08/12/2023 19:28

If your children are already teens, you may well be in for a very expensive run of years soon.

Higher education is not cheap. Professional/post graduate studies are not cheap. IME you could easily need £100k+ for the 2. ( It depends how ambitious you/they are eg studies in US etc. )

That leaves £50k each for a house/flat deposit/ BTL?

£50k for emergency fund, payments into a pension, cars, travel etc. depending on your current provision.

Investing is for 5 years + at a minimum or you may well make a loss.
An IFA ( Independent Financial Adviser ) should be able to point you in the right direction for all of above.

Original poster
sundaysundaysleep · 08/12/2023 20:15

@ElizaMulvil omg how do people normally pay for their children to go through higher education?!!! I had no idea it was so much £££. Do many students would take out loans to pay for it? I can't imagine many parents could afford that sort of money esp if they have several children going to uni

OP posts:
floofbag · 08/12/2023 20:24

You don't need that much money , they get student loans . There is no point in paying for it up front ( we can but havent ) as until they earn a decent amount ( can't recall the number ) they never have to pay it back so don't worry about that . We have to top our daughter's rent up and pay her food but that's it . She doesn't work

bjjgirl · 08/12/2023 20:44

I would buy a buy to let house and rent it out so that the dc have assistance with their foot on the property in a few years and the income can assist with day to day things

ionlywantto · 08/12/2023 20:58

floofbag · 08/12/2023 20:24

You don't need that much money , they get student loans . There is no point in paying for it up front ( we can but havent ) as until they earn a decent amount ( can't recall the number ) they never have to pay it back so don't worry about that . We have to top our daughter's rent up and pay her food but that's it . She doesn't work

Neither of my kids can get anything but the basic loan so it's hundreds per month for two of them!

BananaSpanner · 08/12/2023 21:08

I’ve inherited in a similar amount, a bit more, but we do have mortgage to pay so most will go towards that. The rest is going on home improvements, a MacBook, a holiday, savings for the kids and a bit of a slush fund for any big expenses (eg braces for DS, maybe a school trip abroad). I’ll probably upgrade my car at some point. It’s nice to feel comfortable for the first time in my life but I’d rather have my mum.

FiveShelties · 08/12/2023 21:20

I inherited from my Mum in May and have no idea what to do with it. I am 67 no mortgage, no children and feel the money is not really mine.

That sounds really stupid as I know it is mine but ......
Perhaps it is too soon?

I am sorry for your loss.

itsmyp4rty · 08/12/2023 21:21

Take a year out and travel the world. That's what we plan to do in a couple of years having inherited a lump of money.

floofbag · 08/12/2023 21:58

My dh is a high earner and we get the minimum .Admittedly we only have one dd but she only costs about £300 a month plus her student loans .

My point was it isn't hundreds of thousands at once as the previous post made it sound

whatchagonnado · 08/12/2023 22:21

I would work it through with a Financial Advisor. They'll do a complete evaluation of your finances and pensions and priorities, then help with investing it suitably.

SabrinaThwaite · 08/12/2023 22:25

floofbag · 08/12/2023 21:58

My dh is a high earner and we get the minimum .Admittedly we only have one dd but she only costs about £300 a month plus her student loans .

My point was it isn't hundreds of thousands at once as the previous post made it sound

It would be £50-70k per child if they didn’t take loans and wanted / needed to do a post grad.

Original poster
sundaysundaysleep · 08/12/2023 22:35

@SabrinaThwaite but is that down to the parent or (adult) child to pay for their further education? I would obv pay as much as I could and aim to make their life easier and more comfortable but I would also want my kids to grow up knowing that everything isn't just handed to them (eg house deposit, car, education etc) IYSWIM

OP posts:
SabrinaThwaite · 08/12/2023 22:42

OP, it rather depends on your personal attitude to debt and how comfortable you are with the student loan system.

DH and I were both of the generation where we left university with no debt and we wanted our children to be in the same position, so that is what we have planned for.

Many parents spend £15k per child for private education for 13 years - so that’s £195k before they even get to the university years.

Original poster
sundaysundaysleep · 08/12/2023 23:03

I wouldn't want them to be in debt but i also wouldn't want them to think they don't need to work for anything and that things are just given to them. I will def set aside a significant chunk for them but I don't want them taking it for granted. I remember having to save for a deposit and pay up my first car over many years, my parents could've just bought me it (it was v cheap!) but it made me realise I needed to work to get money.

Not sure if that's a helpful thing to think or not though!!!

OP posts:
SabrinaThwaite · 08/12/2023 23:20

I also think about when I bought my first house, house prices were about 3 or 4 times average salary. They’re now 8 or 10 times average salary. Rentals for well earning graduates often still need rent guarantors. It’s a very different world from when we were their age.

I take the view that our kids are going to inherit at some point - I’d rather help them now when they need a hand up than they wait until we’re dead (and our savings eaten up by care costs).

You can achieve a balance between helping your children and them still understanding the need to work for things - ours had jobs through school and learned how to budget and save.

BucksorHerts · 08/12/2023 23:35

A percentage in something that will beat inflation and which will help your children when they're older. Property. Buy a rental, then they can use it for a deposit on theirs. Extend yours run an Airbnb and have room for the children to come back to etc. Don't let anyone make you feel guilty for taking care of your family. Charles and William just inherited a few billions tax free from their mother/gmother's death yet they had the public pay for the elaborate expenses. Not like they'll suffer if they'd paid inheritance tax.

Your parents paid taxes when they earned it and when they passed it on so secure your children's future with a great education, property, memories and values that live on.

jm9138 · 08/12/2023 23:42

sundaysundaysleep · 08/12/2023 23:03

I wouldn't want them to be in debt but i also wouldn't want them to think they don't need to work for anything and that things are just given to them. I will def set aside a significant chunk for them but I don't want them taking it for granted. I remember having to save for a deposit and pay up my first car over many years, my parents could've just bought me it (it was v cheap!) but it made me realise I needed to work to get money.

Not sure if that's a helpful thing to think or not though!!!

I worked for everything I have and it gives me a sense of pride in myself and when I am feeling a bit down I can think 'everything I have I got myself'. I would not want to take this from my children. The inheritance they will get from me is having a parent who loved them deeply and always gave my time freely to them. If they need a bit of cash to go out they can have it (I gave my lad at uni £50 the last time I saw him to get a bit of shopping). But it is not my job to pay their mortgage or the debts from the choices they make. One of the reasons house prices are so high is because people with money help their kids to buy driving up prices or people inherit and buy rental properties (also driving up prices). I choose not to be part of that problem.

My answer is that with £250,000 you could do an awful, awful lot of good. Your mortgage is paid. Go on a holiday, take your children on a lovely holiday. Why not set up a charitable trust and offer scholarships at your local comp or offer to pay for after school actives for local children? Or ask local charities what you could do to help? There is so much you could do that would make your local community better which would be a great inheritance to then pass onto your children and you would get a lot of pleasure out of.

I appreciate this is an unpopular opinion.

floofbag · 09/12/2023 07:33

Our plan is to see when dd gets a job earning over the threshold to pay it back and then we will clear it

Martin Lewis did a thing on it years ago .. it doesn't make financial sense to pay it upfront

We can and are investing that money now so it will be worth much more when it's needed .

floofbag · 09/12/2023 07:34

A good well paid job isn't a given and also them getting a great degree isn't a given..

It's likely but not guaranteed .

femfemlicious · 09/12/2023 07:37

sundaysundaysleep · 08/12/2023 18:58

Apologies if this comes across as insensitive to anyone with money worries but I can't speak about this to anyone in real life (other than DH) and thought this was the best section to ask this question.

I am due to inherit around £250k after my remaining parent died this year. It was a horrible ending and I am grateful that this money has been saved and passed on despite the awful circumstances to receive it. I therefore want to consider how to use it in the persons memory but also use it to live life and connect with adventure, experiences, life and living!

Our mortgage is already paid off and I don't have any debts (like credit card or car etc). A chunk will go to our teen kids for when they are older, and I will probably put some in my pension but what else will I do? We are def going to go on an amazing holiday at least.

WWYD? Invest? Splurge spend and enjoy? Move house? Buy a buy to let / holiday home?

Any ideas welcomed! Thank you

I could do with 10k pretty please 🙏🏿😁😭. Splurge and enjoy half, invest half.

Brandyginger · 09/12/2023 07:42

Inherited a large sum last year : 90% has been set aside for DC (albeit private school fees which you don’t have). Future Uni fees, accommodation, house deposits.

if you were to use it for your dc it is a relatively short investment horizon so shares may not be the best place to put more than 20% of money. I’d use cash isas for the rest (spread across you, dh and child isas for dc) otherwise you’ll be paying tax on the interest. You could do £80k this year £80 next year and put the rest in premium bonds where winnings are tax free