New pension rules query

wotsthat

barnsleynanna wrote: »

Your family is obviously different to mine! If the kids move, we'll move with them .. if the grandkids grow up and leave (which of course they will !), more space in the house... so what's the problem there?... and if you think 2 months a year every year would be an issue, then your family obviously isn't as close as mine !! We've had them all living with us for months on end whilst waiting for different army accommodation.

The big problem I see with this plan is that you're making a decision that works today but there's no going back. If it doesn't work in 5, 10, 20 or 30 years you've hamstrung yourself by giving away your money.

From experience with the in-laws I can tell you that having impoverished parents and grand-parents is really quite stressful. Being financially independent is one of the best gifts you'll be able to give your daughter.

With respect the sums of money you're talking about are quite small. Why can't you keep the money and live with your daughter 2 months per year anyway? If you find that you've got more money than you need why not start gifting money at that point?

atush

Maybe their house is too small?

the only way for this to work (and I still say don't do it) is to buy the new house with your daughter.

Will protect your share in a future divorce, and she can still inherit it when you go. Will give you a CGT exemption if you live there a few months a year if you nominate it as your home instead of the caravan (which would from then be subject to taxable gains).

Far better ti gift her a portion of the LS, or to sell your home and give her some (not all) of the proceeds, the rest going to fund your retirement (perhaps funding a month in the med each winter)

sheramber

Have you cosidered what would happen if your daughter died before you and her husband remarried.

The house would belong to the new couple.

Would you still be welcome to stay with them?

atush

Would you want to? (thought I brought this up in a previous post but whatever)

BobQ

OP,

I have just read through this thread. You are clearly a very generous couple and your wish to help your daughter is laudable.

You cannot foresee all the things that could happen, but I agree with others that you may be making a big mistake in assuming that you will have enough to live on.

You make the mobile home sound very nice (I am wondering if I might buy one for my retirement!) but I would urge you to invest your money for yourselves.

If you must gift the money, consider retaining a share of the house that your daughter will either inherit or be able to buy when they are better placed. Or consider putting the money into a trust to protect it for the benefit of your daughter allowing the trust to own a share in a house in which she resides.

But looking after yourselves in retirement should be your first priority and the pension funds you have should be used for income or luxuries like the occasional holiday, replacing the car etc.

rpc

atush wrote: »

Would you want to? (thought I brought this up in a previous post but whatever)

Could they afford not to?

barnsleynanna

atush wrote: »

Re : buy the house with my daughter.

Will protect your share in a future divorce, and she can still inherit it when you go. Will give you a CGT exemption if you live there a few months a year if you nominate it as your home instead of the caravan (which would from then be subject to taxable gains).

Far better ti gift her a portion of the LS, or to sell your home and give her some (not all) of the proceeds, the rest going to fund your retirement (perhaps funding a month in the med each winter)

I know I'm a little thick sometimes, but could you explain about the capital gains tax for me ? if I buy a house with daughter? I also don't think this would be possible as I'll be packing in work when hubby retires? Unless we could use the funds from the sale of our house (or some of them) against the new property? Would we then be able to put the property in two names?

atush

If you bought a house with your daughter (and didn't live in it) when sold you'd have to pay CGT tax on any gain above your allowance (over 10K at present). If you lived in the house for a period of time, you would not then have to pay tax.

but given your proportion would not probably be above 10K makes this moot.

barnsleynanna

atush wrote: »

If you bought a house with your daughter ....

Atush. This is something we hadn't really considered in any great detail (original idea, as you know, was to give them the money as a deposit). Would I be as well to go to the mortgage forum for advice on this? I've no clue how buying a house with my daughter would work? Let's say we put down something like 40% LTV (just as an example). Would that mean the mortgage would be in both names, and would my husband and her partner's names be on it? Would hubby and I have to provide evidence of earnings (we'd both be retired by then). Any advice appreciated, or just point me in the direction of mortgages forum instead .. thanks for all your help !

atush

yes, I would go to the house buying, mtg or even tax forums as this is a cgt tax question.

AS far as the mtg, the bank might want you to be on it as you owned a share in the house (40% i assume-some mtg companies dont' like this so this is a mtg question) and would be better put in place before retirement.

If you put in 40% LTV, how much equity would they be putting in?