Buying an investment property for children

Mojisola

RonnyRaygun wrote: »

Yes, a trust that automatically transfers to a child at the age of eighteen is not ideal, although I wouldn't tar all eighteen year olds with the same brush. Even at the age of eighteen, my priority was saving money, first for a car, and then for a deposit on a house. By the time I bought my fisrt house I had a substantial deposit almost entirely saved up myself.

Obviously it's the automatic transfer that is the issue as it wouldn't give me the opportunity to to decide if my children were ready for the responsibility of being bestowed a large sum of money.

Many 18 year olds are very sensible with money but there's no way of knowing how any one particular individual will react to an unearned windfall some years in the future.

Unless a parent can honestly say that they don't care what the child does with the money and that it won't affect future relationships if the child "wastes" the money, keep some control over it.

I've seen it take years for parents to come to terms with a child spending years of savings in a few months - the recriminations - "I put off doing things/went without luxuries in order to save that money for you and you've wasted it all!"