Dad wants to help out with debt...is he allowed?

Rafter

Agree with some of the later postings here - the main thing is to make sure your sister is happy about all this and thinks it is fair. £8,000 today may be worth a lot less when your dad does pass away and the estate is divided between you.

One thought about how to make it absolutely fair is to take out a good value loan for £4,000, give the proceeds to your sister so you each have £4k each. That way no need to adjust the will and both of you benefit now. Maybe your sister could do with the 4k too, but for other purposes than clearing credit card debt?

Good luck

R.

lipidicman

I also didn't mean to give you a hard time about paying the money back. However people who are rescued don't always learn their lesson. Another good idea might be to put some of the money that would have gone into repayments into a savings plan (kids education etc). Something that feels like you have had to make a sacrifice.....just my two cents anyway.....

THE_LONE_RANGER_4

having looked at the threads i think all this talk of inherritence tax is a non issue as who ever pays your bills is irrelevent ie father/mother/brther auntie bessie/ ,the main issue is having created a debt and then allowing your father etc to bail you out is an issue as a lesson may not have been learned when a parent has worked all there life they deserve to enjoy the money ,they may well take pleasure from bailing there children out of a bit of trouble but it does nothing for the one being bailed out as these programmes on tv show 3 years down the line same boat again,my parents could, if i had asked bailed me out many times over but watching an alvin hall tv programme your money or your life,where he looked at parents bailing there kids out, in general the children should not accept the offer ,if they do pay them back ....this was a eye opener for me as he made you look at it in a different light ie you have not got an inherritence until its left you ,and your parents will offer to bail you out becouse they love you hence dont put them in that situation ......any way i hope i dont come accross badly im just giving another slant on the issue all the best with what ever you do reguards andrew

xela_17

The argument that a parent should never bail out a child because then they won't have learnt anything is a good one in some circumstances. However, IMHO, if my parents offered to pay off my £5000 debt I wouldn't be not learning anything (sorry for double neg) because I have already learnt my lesson about debt. I had my lightbulb moment about a year ago and anyone now paying off my debts wouldn't change the attitude I now have towards money. The OP sounds like he has also had his lightbulb moment so there's no danger of spending again.

lipidicman

No I did get the feeling that the OP had learnt his lesson.....but we must accept that none of us really know

THE_LONE_RANGER_4

thats it if it does not hurt it hasnt worked hence the paying directly back over a few years in general is a good idea,

freeclimber

If your Dad hasn't changed the will yet, there might be an alternative route...

Your Dad gives you 4k as a gift, and 4k as a loan. That way you should be clear of any tax issues.
You pay regularly into an account to the value of 4K, which is then given to your sister. Again, should be low enough to avoid tax issues.

Your Dad has effectively given both of you 4k, but in spearate years.
You get to pay some of the money back, keeping up the practice of being moneywise.
Your sis gets an equal share.

You all buy me a beer for coming up with an ingenious idea that no one else has thought of, honest guv, strike me down with a kipper if I'm telling you a porky squire :beer:

Rafter

freeclimber,

Here is a low flying kipper for you!

See posting #12 above.

Great minds think alike I guess.

R.

PS - Banana cake sounds great.

freeclimber

Rafter:
freeclimber,

Here is a low flying kipper for you!

See posting #12 above.

Dammit. Always the bridesmaid, never the bride.

CLAPTON

final post from me.....sorry I didnot notice the bit about your dad's estate being less than inherence tax threshold......so he can do what he wants without regard to any future Inherenance tax, so he can just give you £8,000 straight away if he wants.