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!

Not legal so not 100% sure. However if they don’t marry, it would probably be simplest to buy a new house and put in 50/50. Any other assets they can invest somewhere else.

Or draw up an agreement with a solicitor about their different stakes in the house.

However if they don’t marry, it would probably be simplest to buy a new house and put in 50/50. Any other assets they can invest somewhere else
I think in these circumstances, that is indeed the solution that will make it fair. It certainly isn't the best way to invest, keeping the two properties would be a better decision financially, but they will need to weigh fair vs better off, which is probably why they haven't managed to reach an agreement.

**swingofthings

I agree and it makes sense to take the same approach when it comes to inheritance, each keep their property and these are ringfenced to the children two, so OP divides her house in two and her OH's house goes to his boy. If any wealth is added after they get together, that can go 1/3 to each child.

This is my proposal that we ring fence our equity whether we buy a new house together or he lives in mine and rents his out. I currently have a 1/3 more equity than he has.
My plan would be get the houses valued and equity gained in our own house from today is ours and ring fence that. Then my proposal from then on as a family of 5 we would split the inheritance by a 1/3 however this is the part we can't agree on. He thinks wealth that we have gained together from moving in should be split 50 to his son and 25/25 to mine. As he says that our combined wealth is 50% mine and 50% his so therefore our children should inherit what we have as their individual parents regardless of the fact that we would become a family of 5. His says my proposal of a 3 way split would mean that I am asking him to being an irresponsible dad to his son.

So currently, you have a bit more equity in your property, but as you have two children, they would end up with a bit less than his child whose equity will all go to his son. You both agree to this.

Moving on, the fairest way is to agree that you both end up with the same disposable income at the end of the month once EVERYTHING is counted, all income (including rent on his side, maybe maintenance on yours), and all essential outgoings, including both mortgages. If he earns more, this will mean that he will most likely put in more BUT, if say there is combined £2,000 disposable income, he gets to spend this on himself and son only, whereas you have to share amongst three.

As for equity gained in the properties, why do anything different? The equity in your property goes to your two children and the equity in his goes to his son, so ultimately, his son will still end up with more because he won't have to share.

So all in all, your house, your children, his house, his child, every day life, he puts in more, but has more to spend (relative to the fact it's for 2 of them rather than 3).

He is being unreasonable. Still.

You see I’m with your partner now.

Any assets gained together - I think should be split 50/50. Your children are not his. I would not to be working to pay for a step child’s inheritance at the expense of mine, just because they had more children than me.

It’s clearer if you think - If you had 4 children for example and he had one then he’d be giving you most of his one child’s inheritance. That he had contributed 50/50.

I'm with the husband too. I think it is the fairest way. Your children get half and his child gets half. 💁🏻‍♀️

That is much clearer now. I agree with your DP - it does mean that you will be contributing 50:50 to make it "fair" and could keep savings separately...

I would get legal advice alone on this matter.

What if you split the growth in equity 30/30/40? So his kid gets a bit more but not twice as much as your kids? And if you’ve ring fenced the equity to your own children then his son will be getting more anyway.

Ultimately what you are asking is to treat everything gained before on the basis that your children have different parents but what is gain afterwards as if the three. children were joint.

This unfair because if indeed the 3 children were joint the equity from before would be joint and divided by three so it's fair to either operate on the basis of being a joint family from the start or not at all which I think is the argument your OH is trying to pass across.

Just stay ad girlfriend and boyfriend. Or you make a 66% contribution on future expenses/assets in order for your DC to get an equal amoung in the end.

Just to clarify....the expenses should be split 66.6/33.3 until all children have left home. Then it can be 50/50 with expenses as it will just be the two of you.

It is very much like a business arrangement though.

Make a will out for where your assets would go - if you’re married everything would automatically go to the spouse - unless it has changed I understood that anything you owned would go to your next of kin, this is not your stepchildren unless you had adopted them. Worth seeking advice from a solicitor.

How are her children getting 117500 each as it stands now? Just because your house is worth 235k {117500 each) and your house is insured doesn't mean you should work your kids inheritance out by your liabilities as that means you could just go and get a mortgage for a million pounds! Does that mean you work it out as you're kids will get 500k each! That's absolutely ridiculous!

How's is he unfair you both put an equal amount in and you both take an equal amount out he and his child's mother has a responsibility as parents to provide for there son, you and your childrens father have a responsibility to provide for your children.
I think it is admirable that he is willing to take on your children and he will be equally contributing to your house in affect reducing your liabilities considerably so in a way will be equally contributing to providing a roof over there head.

his duties as a father need to be respected and by doing so shouldn't reflect on the dynamics of your relationship you are just respecting each others past and commitment he shouldn't have to give them a slice of his inheritance.

If you both put in equally you both take out equally where's the problem?

SandyY2K suggestion is also fair

I agree with you. The fact he is suggesting anything other than your children get your home and his child gets his is truly appalling.

so in a way will be equally contributing to providing a roof over there head.

They aren't homeless. Their mother currently provides a roof u see which they live and provides for their needs.

She doesn't need him to provide for them.

I'm not sure why you want to live with him - sounds ike a bully...in his approach even if not his reasoning... If you cannot go and see an advisor together then how can you live together?

I'd be worried about how he'd treat your dc when he's there especially if he's disney dad when his son is around - they are all heading for teenage years which are tricky anyway.... what if hes buying his DS Imacs and yours are sharing a walkman! for example you say you wouldnt expect him to contriute to your dc presents etc but how will you manage that potential difference esp a he has higher income

I think the house finance stuff is tricky but sortable in some shape or fashion..... but it is really highlighting that your relationship is in the right place for you to live together with your DC ..

I think your instincts are telling you this......please listen to them ... maybe postpone the discussion for 6months/ year - and see where your at... take the heat out of the situation-