How to give dc money and inheritance

[Milliemooss]

We do not have massive saving s 40k and own our own home.
can we put the house in trust to them and is sol how - ive heard of this and contacted solicitor - she did not mention this possibility.

do we need a financial advisor rather than solicitor?

i am aware that if we go in a care homw then any financial help within 7 years of that wd be seen as deprivation of funds - all we want is to be able to give dc help to get om mortgage ladder - does this mean we have to give them the money now ? They are nit ready to buy atm as they work in london and cant buy there as too expensive so are waiting until they can get a house outside and commute/ wdh . I domt want them to soend it on something else really but appriciate i cant stipulate how they use a gift!
I appreciate that compared to lots its nit much money and people may say save it for yourself - but ive never had any financial help and would like to support my dc .

we are both working part time with small pensions . Then in 3 years dh gets state pension - at this point we will retire as we will have enough to live simply .

Take financial advice, maybe from more than one adviser.

There have been previous threads on this. Sorry can’t link but you can search.
Basically, probably not a good idea.

I believe that the 7 year rule is for tax purposes- if you die within 7 years of gifting money then tax will be due.

As far as I’m aware there’s no 7 year period for deprivation of assets, they can come after you for that at any point if deemed appropriate.

Definitely get some advice on this

I believe that the 7 year rule is regarding inheritance tax not deprivation of assets.

£40k is not a lot to see you through retirement, everything is so expensive now just think of replacing your car, or having it fixed, will you need a new boiler etc.

The real question is how much is your house worth? Are you planning to downsize, do you have a mortgage?

Estate planning can be expensive and so can setting up trusts so you would want significant assets to do that. There is quite a lot of information on the government website regarding what you can do tax free and the IHT thresholds so it’s worth looking there first.

Could you not just pay a contribution regularly into a lifetime ISA or even a pension for them? If they are not looking to buy right now it would have time to build up and the government matches the lifetime ISA contributions so it's a good deal.

If you want DC to benefit from the equity in your house then you'd have to sell it, downsize and gift them the money. If you then survive 7 years there is no inheritance tax on it.

Deprivation of assets has no time limit but would be applied if you gave a big gift when you could reasonably foresee that you would have care needs so certainly you cannot do it if either of you has a diagnosis or is in need of care already but if you don't you can do it. As others have said you might want to be wary of impoverishing yourselves to help DC. Retirement can be a long time.

There is no time limit on deprivation of assests.

I can feel the love you have for your children in your post but as a child of retired parents getting older the best gift they can give me is the knowledge that they are covered for emergencies and have savings if they ever need a bit extra help. Before care home conversations there will likely be a need for a cleaner, gardener, home help. Obviously I intend to help as much as I can but with my own family knowing my parents can buy in some help is so reassuring to me. Help to buy for me would have been lovely but not at the expense of worrying about how they’ll manage.

Agree with @museumum if you have a parent that needs any form of care, the relief that they can pay for that themselves is huge. Inheritance is utterly irrelevant if that happens. Seriously the best thing you can do for your kids is to take away the financial burden of looking after you in old age.

Whatever you can do to help them set themselves up to survive financially by finding their niche work wise is the best thing you can do for them.

GoodlifeGlow
we have no mortgage and own the house.
we live in a v v expensive area and there is nothing to downsize to in our very expensive village which we love . The next town is also v v expensive to buy in too due to all the holiday lets pushing prices high .

OP, do you both have Wills? If not, that's the first thing to sort out. Your Will writer may be able to give advice as to how best to gift money to DC (once you are dead).

I agree with PP. I'd keep your £40k as a safety net for you/DH. You need it for you.