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Is this immoral?
Potternerd
Posts: 413 Forumite
MIL died earlier this year leaving money to OhH and BIL with set amounts for her grandchildren. OH would like to put his share into buying and renovating a house. DS has an ISA set up by MIL along with the sum she left him which he can't access until he's 21. His savings added to OHs inheritance and our savings would make the prospect of buying somewhere to do up and sell more financially viable.
So the question is should we put his money in on the understanding that we return this money plus the percentage of the profits? I think he would earn more than if it was in a savings account, but OH feels it is a bit morally dubious. Is it?
DS is 16.
So the question is should we put his money in on the understanding that we return this money plus the percentage of the profits? I think he would earn more than if it was in a savings account, but OH feels it is a bit morally dubious. Is it?
DS is 16.
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Comments
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Much depends on PP.
If OR and SIS both agree, there is no need to PP (unless under 18), though TER cold be a problem in future.0 -
I agree with your husband. Presumably it's in the will that the money goes into this ISA that MIL set up, so that's what should happen.
How do you know that you would be in the position in 5 years time to pay it back? All sorts of things happen, illness, redundancy, divorce etc.
Put the money in the ISA, it's not for you to decide what it gets used for.0 -
You can't be sure that the property value won't drop (especially as some are predicting if Brexit happens), how would you guarantee the funds were available as was intended when the time comes? I'm not sure you could, you'd be gambling with money that isn't yours. What happens to your relationship with son if you lose that money? Xxx0
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When this kind of scenario appears in the papers, although its usually to do with the mother spending the money on consumables (so the money will never reappear) the mother has been found guilty of theft.
I know you consider it an investment.., but there's a risk attached as there would be with any investment. Your son is not a legal adult, so he can't even consent to the scheme. You could buy a house and find out its a money pit.., outside factors as already suggested could affect any return.
Find a way to do it with just the money your OH has.., or don't do it. You don't have any right to your son's money. What you are supposed to do is protect it.0 -
The inherited money must be kept in trust until he reaches 21, and must not be used for any one else's benefit. The problem is where to place the money until he reaches 21. Assuming that the ISA in his name is a junior ISA that money becomes his at 18, and if he is over 16 and it is an adult ISA then he can access it now.
So the additional sum left to him cannot go into the existing or new ISA if you want to abide by the wishes of the will. How old is the beneficiary and what sort of sum of money are we talking about?0 -
It's no different to you deciding to put the ISA money all on red and promising to paying back if it didn't come off. You don't get to choose what his money is gambled on, MIL already did that and she chose the ISA. So it's not "dubious" or even "morally dubious" (which gives the impression it's OK legally) , as said, its theft.
Hands off !0 -
There are such things as Trust accounts which are irrelevant of age; and the trust (depending on it's set up) can make investments for the benefit of the trust. If it was solely the trust buying the property in the trust's name then the risk would be the Trust and it's trustees. However due to the mixed funding you're suggesting, I believe it would be argued that you weren't acting in the best interests of the trust but rather yourselves.
The problem comes with the risk involved. Could you look at a different investment vehicle or gift the property to the Trust so that it becomes the owner? Really you need to explore your options with an accountant or similar xxx0 -
It's completely immoral. If you want to borrow money, go to the bank."Real knowledge is to know the extent of one's ignorance" - Confucius0
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