Advice please re children's investments

josephs_mum

I am looking for some advice please: my father passed away very recently and left approx £7 k for each of his 7 grandchildren, to be given when they are 21. Their ages range from 12 - 23, with only one being currently over 21. The next nearest in age is 18. I am the executor of the will and am at a bit of a loss what to do with this. My research shows that they can hold child ISAs but only until 18 and then the money automatically becomes theirs when they are 18. I feel that I owe it to my dad to try to get the best rate (I know that's a bit of a laugh at the minute!). Does anybody have any suggestions please ? many thanks

xylophone

Has the money been left to each child when he becomes 21 or if he reaches 21?

See post 6.

https://forums.moneysavingexpert.com/discussion/comment/69469347#Comment_69469347

https://www.gov.uk/trusts-taxes/types-of-trust

However, if these funds can be held in bare trust, then each child does have the right in law to access and control at age 18 (16 in Scotland).

It would be possible for a Trustee to hold funds in a bare trust beyond this age with the consent of the beneficiary.

However, you may find it very difficult to set up a bare trust account on behalf of the 18 year old.

You should consult the solicitor who drew up the will to confirm the nature of the trust that has been created.

If it turns out to be a discretionary trust, then there are other tax implications and you may find it difficult to set up a suitable account.

https://forums.moneysavingexpert.com/discussion/comment/70904061#Comment_70904061

In reality you can only do what the law and bank facilities permit- presumably the money is currently in an executor's account earning no interest - in theory it could stay there but you would hardly be doing your duty by the beneficiaries.

In the end, (assuming that the cash is indefeasibly vested in the beneficiaries)it might be thought best to encourage the 18 year old to open a three year fixed rate bond with the £7000 so as to keep within the spirit of his grandfather's will - as for the other children, the best paying accounts for under 16's could be opened, followed by a five year bond shortly before the child turned 16?

josephs_mum

Thank you . I think that the situation is your last para is probably the best. I'm sure my poor old dad never imagined it would be this difficult!

One last question please: we are a very close family - would I be fulfilling both my duty and the law if I simply passed this money onto my siblings to invest until their children are 18 (or 21 if the child agrees to it?). thank you

xylophone

It seems to me that provided that your father's will indefeasibly vests the money in each grandchild, it would be permissible for you to pass the cash to your siblings to act as bare trustees for their children.

josephs_mum

thank you