Feeling guilty what would you do

immortalprincess

Hi,

I have just discovered this site, its amazing.

I am determined to be mortgage free within the next 5 years, but I feel a bit guilty about something and was wondering if I could have your opinions.

Currently my mortgage is for £50k. Its only my husbands wage we have coming into the house so if I want to clear this in the next 5 years I would basically need to throw every penny to it.

what i feel guilty about is that I havent been putting any money by for the children for when they get older, as I have been overpaying on the mortgage.

We have emergency savings as a family but my husband is talking about paying most of that to our mortgage to bring it down even further.

I really dont know what to do. Should I put money by for the kids to give to them when they are 18 or should I just keep overpaying the mortgage. My oldest is 12 and he thinks he has money by in his account but he doesnt.

Any opinions would be very welcome.

Pee

Does this mean you have taken money out of his account or told him there was money there when there is not?

Both of those would appear wrong.

The idea of paying off your mortgage, so that you will have free money should he want driving lessons or to go to University seems very sensible and I would suggest that your money - or you and your husband's money - is better off in your hands than in the hands of you children at say the age of 18. Some 18 year olds are great with money, about 5% of the population is my guess.

brians_daughter

what a wonderful position to be in!! if it was me, hoping one day it will lol i would be paying the mortgage off and then in 5 years your eldest will be 17? Then you can invest the same amount in an account for them for 3-4 years til they are 21? is that a reasonable solution?

It makes little sense to me to save for your son at such shocking rates that wea can get at the moment whilst paying more interest on the mortgage?! By clearing the mortgage asap you will pay less interest and then can look at saving for your son.

My eldest is a simular age and thinks he has money... well he does but he thinks he will be a millionare £100 is an awful lot of money, or so you think at 12! I would get an account set up for them if they dont already have one and pay 1/2 of any gift money into there for them then top up when mortgage free

brians_daughter

and no way will my kids have money at 18... they are deffo waiting til 21.. or if they choose to go to uni we will hlp out then too, but his savings are only for 21 when hopefully they are a little more sensible than 18

Pee

My parents saved money on my behalf - child benefit usually - and I saved my birthday money. At about 23 I used this money as a deposit on a house and they were furious I could get my hands on it without their permission. Of course, I could have also spent it on getting a crack addiction/ travelling around the world. I'd avoid putting money in children's names unless you are happy that it then belongs to them, at whatever age you have put in place.

immortalprincess

Hi

My son has a little money in his account but not much about £1000 because I was able to put money by in his account for quite a while and he was with me when I went to the bank and since then he has thought I have been putting money by for his every week. Sometimes if he needs new clothes or shoes etc and Ic ant afford to get him them, I will take the money out of his bank account.
we also have an endowment policy for him (yes stupid I know but we took this out 12 years ago). It matures when he is 18. I have always said that we should wait until he is 21 before he gets any money but, everyone in the family thought that was a bit much and he should have the money when he was 18.

If he ever gets birthday money or money at christmas he spends that whichever way he wants BECAUSE one time I took the money off him to put into his bank account, and the people who gave him the money (grandparents and uncles) were extremely rude to me and basically made out I was stealing the money!!!!! but I wasnt it went into HIS bank account. if I had left it with my son he would have spent it on rubbish.

Pee

I think £1000 is a good amount to have in his name, and he can add to this if he wishes. I think it's normal for twelve year olds to spend money on rubbish. How much is the endowment policy? Is that in his name? In that case, there is plenty of money for him. Carry on being a mortgage free wannabe and think of the spare money you will have for yourselves or for him in five years time!!!

immortalprincess

Pee wrote: »

My parents saved money on my behalf - child benefit usually - and I saved my birthday money. At about 23 I used this money as a deposit on a house and they were furious I could get my hands on it without their permission. Of course, I could have also spent it on getting a crack addiction/ travelling around the world. I'd avoid putting money in children's names unless you are happy that it then belongs to them, at whatever age you have put in place.

The bank account is in my sons name as I said the only time ive taken money out of it is if he needs something and I cant afford to get him it. The money has always been spent on him.

I think the reason why I feel guilty about this is because my SIL was saying that she has £5000 in her daughters account, she puts £20 by every month for her.

I have been saving my loose change and paying that to the mortgage but im wondering if I should put that into the childrens bank accounts.

immortalprincess

Pee wrote: »

I think £1000 is a good amount to have in his name, and he can add to this if he wishes. I think it's normal for twelve year olds to spend money on rubbish. How much is the endowment policy? Is that in his name? In that case, there is plenty of money for him. Carry on being a mortgage free wannabe and think of the spare money you will have for yourselves or for him in five years time!!!

The endowment is in trust for him. Im not sure how much it is for its my husband that dealt with that all I know is the money comes out of the bank account every month (£20).

Obviously when me and DH pop our cloggs the money for the house will go to my 2 kids

esuhl

The amount of interest you pay on your mortgage will probably be higher than the interest you will get on money set aside for your kids.

If that is the case, you will spend more money on interest re-payments if you save for your kids and then pay off the mortgage.

Grumpy_Git_4

Children have no innate right to have money off their parents, mine saved for me from birth, not much and when I hit 18 it was worth around £1000, this stayed in my account till I was 20 and finished uni. then I spent a small amount of it on a computer. But my parents did help to pay for university and I had no student loan.

I would not worry about not having masses of cash saved for your son, if he assumes he will be rich, just tell him he wont be and that the money is not for "wasting" but for something constructive like a house deposit.

I would pay off your mortgage and then help your son through university to minimise his post university debt (assuming he choses to go to university.)

Nick.