Step children and inheritance

[A1056056]

Hi all
Just wondering if any one can offer any advice. Me and my partner have spilt up over the way we decide to split our inheritance between our children.
We have no children together. I have two and he has one from previous relationships. There is no plan to have any children together.
After lots of back and forth last year he decided to move in to my house. Then the word inheritance came up, something that had never crossed my mind! I knew we would need a pre-nup but never really thought about anything else.
We both have a mortgage on each of our houses.
My OH stated that if we kept both houses, moved in to mine and rented his house our assets would be combined. Therefore in regards to inheritance as he has one child his 50% would be given to his child and my 50% would be split 25% each to my children.

The issue that I cannot get my head around is the fact that as it stands now (we both have life insurance to cover the cost of our mortgage if we died)
My children would get half of my property which is £117500 each and OH's son, would get the full amount of his which is £135000.
Coming together the amount is £370000 (I will work it out as if we are keeping both houses)
Under OH's way of thinking his son would get 50% of the property estate and each of my children would get 25% each:
OH's son now gets £185000= 50%
My child now gets £92500= 25%
My child now gets £92500= 25%

OH's point of view is that he is taking on half of my liability now and vice versa with me and his house and therefore he owns 50% which to him means his son should get his full 50% and as I have two children my 50% would be divided therefore getting 25% each.

Our children are still relatively young all still at the later years in primary school so we would becoming together and taking on each other's children, although his son only comes every other weekend and my children go to their dads every other weekend. So I guess I assumed we would be a new family unit and each child an individual in our lifetime and after we have gone. My thoughts are the money should be split 3 ways as we are taking things on together as a family and that's how it should end too! My other half is soooo adamant that he is right that he can no longer be with me as he says 'isn't it enough that I'm taken on your children, putting a roof over their heads, paying for food etc' and then he says I expect him to give my children some of his child's inheritance! This is really painful to hear as I really do not want to take any of his child's money I just feel my way seems more fair for everyone but he says my way is only fair for me and my own!
We have both spoken to financial advisors, however this has been separate (our relationship hasn't really been in the right state to go together) and the one I spoke to agreed with me and said that is how most combined families do it. My OH's financial advisor said he was right and you work for your blood and pass on to your blood.
My oh did state that if he had a lot more money then maybe he would split things more towards my way but as he doesn't he has a duty of care to provide for his son!

A trust fund has also been discussed to ensure that neither of us would be in the position of after one of us died all the joint assessments would be sold straight away and that the surviving spouse would be able to live in the family home and that a certain amount would go in to a trust fund for whichever child's parent that died first.

Everyone we speak to has their own opinion and we are getting know where!
I am really starting to doubt my way is right as my oh is so adamant that he is right and that he can't be with someone that thinks it's right to tell someone what they should do with their own money! I am really concerned that I'm wrong and that if we never get back together and I meet someone else and they think the same as my oh I will have massive regrets.
I would like to know people's thoughts and if i am having the wrong outlook on how I have worked out the figures and percentages as it does not sit right with working out the amounts as 50% and 25%/25% but if this way is financially fair for everyone then I would love to know.
That is all we want, for it to be financially fair for everyone. The problem is deeming whose way is fair for everyone and that is where the conflict between us is happening.
Thank you for reading! Hopefully there is people in our situation that can help!

I agree with ringfence your assets advice.
He feels entitled to your money...

We went through this with our will and we went with what the lawyer suggested as standard. We are married, DH has two from a previous marriage and we have two together. After the death of both of us whatever remains will be split this way: my 50% of the estate goes to our two children, DH's half is split between all 4 children equally. This obviously leaves our two better off but he split his assets with his ex-wife at the time of divorce and they will inherit a substantial sum from her. I brought more money into our marriage. His elder two have substantial trust funds while our two have nothing. As you don't actually share a set of siblings I'd be inclined to not get married and keep the finances separate. I can't see upside for anyone in you getting married.

If youre sharing the bills 50/50 and he earns £400 more a month, he is really going to be better off living with you

If you lived alone as a single parent, your children would each get half the value of your house. I he was cjntimiimg as a lone parent his child would get a whole house. Which is what he is suggesting. Tbh it sounds fair to me. Why should some of the value of his house be given to your children?

What we have brought to our marriage goes to our separate kids.

I've bought half of DH's house as it's where we live so that property will be split between them.

My kids will get far more than his as it currently stands. But they'll get nothing from their Dad and his will get something from their Mum.

Tell him to get lost. If he wants to pool (and avoid tax ) it gets split three ways OR you just keep EVERYTHING separate - which to be honest seems to be the best idea.

‘What’s yours is mine and what mine is mind’ springs to mind here..,

He earns more than you but only pays 50/50? Op he is on a right good deal isn’t he!

Your house is worth £100k more than his so he would be benefitting from merging assets. I would keep them separate or ring fence up to when you start living together or marry. I think I would be reluctant to move forward with someone who thinks he is putting a roof over your kids heads when in fact he is moving into your house.

My DH and I found this a really hard one to reconcile. I have 2 SC's and we have a child together.
We have lived in 'his' house for more than a decade. I inherited a property a few years ago that is now rented out.
In the end, we have agreed that 'my' house goes direct to our DD only. Our house (if he dies first) goes to me, solely, on the understanding that I will leave it equally to all 3 children (and vice versa). I'm happy to do that. We both understand that these decisions are changeable in the event of care fees, possible remarriage etc. But we will both honour all of our children. The SC's may inherit from their Mum and DP's parents would leave their assets directly to GC if DH passed away before me.
Until you can agree a position, then either postpone living together, or ring fence exactly what you each bring into the relationship.

I’d ring fence assets going in then do 1/3 each after. His way seems totally unfair - if you both died tomorrow his child would suddenly be much wealthier at the direct expense of your children , with assets you have accrued without him. You can’t pool assets then split unequally, if pooling they need to be split equally, ring fencing is the easiest. Why does he think his child should get assets you earnt on your own?
I would be very unhappy with some of the language he is using which implies he has some superior role in the relationship. Unhappy to the point of deal breaking tbh.

My concern would be if you married. Does he not get all your estate then anyway if you die first? (Sorry I've never been married so don't know). But then potentially his kid could get everything and yours nothing?
This is a real concern, as it is if you jointly leave everything to each other with the expectation that on the death of the remaining partner it gets divided between all the children. If you died first and leave everything to him in the first instance There is nothing to stop him changing his will and leaving everything to his own child and cutting your two out completely. Tbh with the things he is saying to you at the moment I would guess it is not unlikely...

I don't want to be annoying but this is just a discussion in principle, you're likely to live to old age and move house several times! You'd sell a rental when you retired to fund a pension surely?
It sounds like he's made a weirdly selfish statement and it's become a big deal when in reality, thou its important to have a will, at this stage its incredibly unlikely to see the light of day.

That's just it, though, isn't it? We all think that nothing is going to happen to us until it does. And that is why it is vital that steps are taken to secure our property, finances, other assets and our children's inheritances in the unlikely, but not impossible, event that our partners should die.

My starting point with the OP's situation would be to look at the position now: ie what would be the starting point if either of you were to die immediately you moved in together. The OP's children would lose out quite significantly if DP's suggested split was applied, and, likewise, if a trust was established enabling the surviving partner to stay in the home until death then again the children's inheritance would be delayed, possibly by many years.

The respective parties "entitlement" will be different now, at the start of a relatively new relationship, rather than 20 odd years down the line when other factors may come into play. This is why wills should be reviewed at intervals to ensure changing thought processes are dealt with.

thou its important to have a will, at this stage its incredibly unlikely to see the light of day.

The OP and her DP will both die at some point though Mother. What they are debating now will form the financial basis on which their relationship is founded.

This isn’t like working out a guardian for your kids on the off chance you die young and hope it doesn’t happen.

This will happen (eventually) and the OP’s children will be impacted by the decisions she makes now.

Edited:

That's just it, though, isn't it? We all think that nothing is going to happen to us until it does. And that is why it is vital that steps are taken to secure our property, finances, other assets and our children's inheritances in the unlikely, but not impossible, event that our partners should die suddenly and unexpectedly.....

he can't be with someone that thinks it's right to tell someone what they should do with their own money!
Tell him to fuck off, his split gives his DS £50K from your house, but he's not prepared to give your DC some of his.

Cake and eat comes to mind.

He earns more than you but only pays 50/50? Op he is on a right good deal isn’t he!

Why is a 50/50 split fair for bills not inheritance?

Especially considering OP has 2 children who would be living with them 12 days a fortnight and her partner would have 1 child with them 2 days a fortnight.

OP, in my reply below I hadn’t taken into account that your house is worth much more, but he wants to split it as if you divided the cost of the two houses combined.

Are you paying the mortgage on your house, or is the idea that he pays half once he moves in? What happens to the rent on his house? By the time the mortgage is paid off, how much of the equity in your house will he have paid?

It may be best to keep your finances seperate. As a Pp said “As you don't actually share a set of siblings I'd be inclined to not get married and keep the finances separate. I can't see upside for anyone in you getting married.”

I too would be inclined to keep your finances separate and not get married.

I think the current setup is fair. Whereas if you were to merge finances I can see both sides. If DP and I do have DC together, DSD would be getting part of DP's share and not part of my share as she has another parent she could inherit from.

Is your house worth more than his so his DC is gaining by this pooling and hour DCs losing.

Sorry but your OH is completely out of order here!

If there are 3 children then it is divided by 3!

It is bonkers to suggest that his child gets more than your two.

I would be more than happy to walk away from that relationship as it appears he is only looking after his interests.

Nope, absolutely not. If you come together as a family, everything should be split equally. Not one child more than the other. That's not how a family works.

Me and dh don't own a house but if we did, everything would be split equally between our dc's.

Dh has a pension and my dc's are not on that but that's fair enough. I don't expect them to be. But if we had a mortgage, then absolutely. It doesn't matter who earns more etc. It's family.

Tbh, I think you've had a lucky escape here as to me, it's not about the money, it's about his views. The fact he's providing for your children is an issue to him? That's what families do. So he clearly isn't thinking of taking your dc's on as his own in that way is he? He may actually start to resent them for it. Especially when his ds is around that much.

I just think he had totally the wrong attitude when starting a blended family. Obviously you are both 100% right in discussing your finances. That needs doing. However if all dcs aren't going to be treated equally in every way, there's no point even trying it as it just won't work.

This is why my mum won't sell her house and move in with her partner. She knows that somehow, his dcs will end up with more than me and my sister. She's worked really hard all her life and she's just not prepared to risk it.

I don't think its unreasonable that he wants only his child to inherit his share. Whats unreasonable is that you are putting in much more than he is and he feels his child is entitled to that at your childrens expense.

You should not merge your assets...If you insist on owning house with him it should be as tenants in common(don't go for joint!) with you owning 2/3rds and him 1/3 to reflect what you both brought in. And it that way your 2 children get your 2/3 and his child gets his 1/3.

But I don't think his attitude to this relationship is right.

You mention a pre-nup. So you are getting married?

In which case it is quite possible you will lose your assets in a divorce before you die. Marriage is a legal merging of assets and a pre nup isn't guaranteed to be binding. Also bear in mind if you go first he can change his will to disinherit your kids after your death if you aren't careful with what you do.

Which is why I will never marry again.