giving my grandchildren a house

grannyjo

I have been left some money by my parents and thought I might buy a small house for my 4 grandchildren who are aged 2 to 8. it could be let until they decide to sell it and that way they would have a good deposit of one quarter of a house each. At the moment the money has been given to them and i am trustee. it is not a formal trust, but put in building societies. I am worried that with the country in such a bad aconomic way, that inflation will take off and their inheritance will be worth a lot less than it is now. Any advice from anyone. I am told that minors cannot be the registered owners of a property so I don't know if it can be done - and if setting up a formal trust costs a lot. someone says that family discretionary trusts will soon be taxed at £400 P.A. or so. Has anyone does this type of thing and can give me any advice
thanks joanna

Henry_P_Chester

I'd be wary about investing in property it's an asset and it's price can go up and down like any other asset it will also require work over the years.

How about a fixed term ISA or NS&I inflation linked certificates. They are tax free and always pay one percent above RPI inflation so currently 6.4%

CloudCuckooLand

A house/flat each, maybe an idea. Except for the management of the propety - who pays for/does that while they are so young ?

One for 4 to share is a recipe for confusion, disagreement and acrimony.

What do the kids do when they disagree, as siblings are wont to do, over when to sell the house ?

1 of them will want a deposit for their own place, and therefore want to free up their 1/4 of the cash, before the other 3 have incomes that can buy their sibling out...

Or some other version of complication.

Not a great idea even if property was zooming away, but while the bad elements of the economy you mention are as just as likely to hurt property investment, it is doubly bad.

getmore4less

What was the arrangement was it in a will?

You need to read up about(or get advice) what it means to be a trustee and the tax implications of holding money in trust for others.

Nosht

grannyjo wrote: »

I have been left some money by my parents and thought I might buy a small house for my 4 grandchildren who are aged 2 to 8. it could be let until they decide to sell it and that way they would have a good deposit of one quarter of a house each. At the moment the money has been given to them and i am trustee. it is not a formal trust, but put in building societies. I am worried that with the country in such a bad aconomic way, that inflation will take off and their inheritance will be worth a lot less than it is now. Any advice from anyone. I am told that minors cannot be the registered owners of a property so I don't know if it can be done - and if setting up a formal trust costs a lot. someone says that family discretionary trusts will soon be taxed at £400 P.A. or so. Has anyone does this type of thing and can give me any advice
thanks joanna

Form an Asset Trust which will protect your property from tax & minimise inheritance issues as long as it is carried out by EXPERIENCED lawyers, accountants & will writers.


N.

grannyjo

thanks for all the advice- i think i'll have to think again and possibly try inflation proof bonds with nsi. I just know that at times I could have bought a nice house and then within a few months house prices doubled in liverpool and i could only have bought half a house. i would have loved a deposit of a quarter of a house when we were buying ours. I find it really difficult to know where to put their money where it will keep up with genuine inflation- not the gov. figures that nseem massaged in some way. - and i can't see how the government will pay back all it owes without massive inflation to erode the debt. It happened around 1978 when we were paying about 15% interest on our morgage.Stocka and shares go up and down like yoyos too so with my luck it would be invested on a high and then drop like a stone like at the millenium when they seemed to about halve in value.

Fire_Fox

You should see an independent financial advisor!