Kids savings account v overpaying mortgage

muhandis

God, you clearly don't get it.

Again, to state the obvious, I have no intention of breaking the law. Doesn't matter what you think my intentions are. Unless you are a legal professional giving me advice that I have solicited, it doesn't matter one jot to me what you think the law says.

If you feel so strongly about it, please go ahead and report me to the police.

PS: To me personally, your comments came across as patronising. Clearly, you don't feel that way, which is absolutely fine. Again, we'll agree to disagree.

ValiantSon wrote: »

You clearly don't understand. The law is very clear: the money becomes hers, and you cannot use it as if it were yours. It isn't a matter of what my personal view is, I'm talking about what the law says!

No you don't. Once the money is given to her, you cannot use it as if it were your own. It really is very simple.

Again, this isn't my opinion, it is the legal position! No, I'm not going to agree to disagree; the law is very clear about beneficial ownership and bare trusts. You are proposing to behave contrary to the law. This is not a grey area where we can agree to disagree.

Yes, and one of the implications is that the money no longer belongs to you, and you cannot use it as if it does. Doing so would be theft.

ValiantSon

muhandis wrote: »

God, you clearly don't get it.

No, I get it perfectly! You just don't like being told that your plan has a major flaw.

muhandis wrote: »

The law is very clear and I have no intention of breaking it. Doesn't matter what you think my intentions are. Unless you are a legal professional giving me advice that I have solicited, it doesn't matter one jot to me what you think the law says.

I'm not saying what I think the law says, I'm saying what it actually does say!

Don't ask questions if you don't want honest answers. If you want everyone to say what a great idea it is then go to one of the other boards, rather than one that is frequented by people who actually know something about savings and investments (including the legal framework).

I don't need to ponder what your intentions are, you made them clear in your opening post. You said, "The way I see it, it would be better to open an account in my 18 month old daughters [sic] name and use it to hold any cash that I would otherwise use to overpay my mortgage. I get a slightly better return and better yet still have access to that cash in case I need it." It is very clear, therefore that your intention was to use a children's savings account to profit from the advantageous interest rate and then take the money out to pay off your mortgage at a later date. That would be illegal.

Don't throw your toys out of the pram when you are - quite reasonably - told that you can't do this.

muhandis wrote: »

If you feel so strongly about it, please go ahead and report me to the police.

Fine, just provide me with your real name and address, plus the details of the account you are using, and evidence of you then withdrawing the money to pay off your mortgage and I will be happy to do so!

You are making a massive mountain out of a molehill. I advised you that - depsite previous warnings - you were still considering acting in the manner you first described, and that this really was illegal. You could simply have accepted what I said and done nothing, or even - heaven forbid - thanked me for stopping you from making a mistake. Instead you chose to get shirty and to pick an argument.

muhandis

You just don't like people disregarding your opinion! Don't answer posts if you think everyone should treat your words as the gospel truth. No point in throwing a hissy fit when that doesn't happen.

Again, I could not care less for what you think the law says or what you think my intentions are.

Ah, can't make it that easy for you Just use my forum username to lodge a complaint, I'm sure the police has the tools to trace it back to me. That might help you sleep better.

You are making a massive garbage dump out of an empty packet of crisps. You could simply have accepted that there might be people who don't really care for your obsession with getting people to accept everything you say as the lord's word - or even - heaven forbid, move on. Instead you choose to get hopping mad.

ValiantSon wrote: »

No, I get it perfectly! You just don't like being told that your plan has a major falw.

I'm not saying what I think the law says, I'm saying what it actually does say!

Don't ask questions if you don't want honest answers. If you want everyone to say what a great idea it is then go to one of the other boards, rather than one that is frequented by people who actually know something about savings and investments (including the legal framework).

I don't need to ponder what your intentions are, you made them clear in your opening post. You said, "The way I see it, it would be better to open an account in my 18 month old daughters name and use it to hold any cash that I would otherwise use to overpay my mortgage. I get a slightly better return and better yet still have access to that cash in case I need it." It is very clear, therefore that your intention was to use a children's savings account to profit from the advantageous interest rate and then take the money out to pay off your mortgage at a later date. That would be illegal.

Don't throw your toys out of the pram when you are - quite reasonably - told that you can't do this.

Fine, just provie me with your real name and address, plus the details of the account you are using, and evidence of you then withdrawing the money to pay off your mortgage and I will be happy to do so!

You are making a massive mountain out of a molehill. I advised you that - depsite previous warnings - you were still considering acting in the manner you first described, and that this really was illegal. You could simply have accepted what I said and done nothing, or even - heaven forbid - thanked me for stopping you from making a mistake. Instead you chose to get shirty and to pick an argument.

ValiantSon

muhandis wrote: »

You just don't like people disregarding your opinion!

:wall: It isn't my opinion, it is the law!

muhandis wrote: »

Don't answer posts if you think everyone should treat your words as the gospel truth. No point in throwing a hissy fit when that doesn't happen.

You appear to be describing your own behaviour, rather than mine.

muhandis wrote: »

Again, I could not care less for what you think the law says or what you think my intentions are.

It is what the law says, and you are just wrong. Accept that you are wrong and move on.

muhandis wrote: »

Ah, can't make it that easy for you Just use my forum username to lodge a complaint, I'm sure the police has the tools to trace it back to me. That might help you sleep better.

Again you demonstrate that you don't understand how the law works. Asking a question on an internet forum doesn't make it a crime. You would have to take the actions you describe for it to become an offence. Your posts on the internet would only be of use in that instance as further evidence of your conspiracy to defraud.

muhandis wrote: »

You are making a massive garbage dump out of an empty packet of crisps.

What are you talking about?

muhandis wrote: »

You could simply have accepted that there might be people who don't really care for your obsession with getting people to accept everything you say as the lord's word - or even - heaven forbid, move on. Instead you choose to get hopping mad.

There is no point in talking to people like you. You cannot accept it when someone points out a problem with your "clever" little plan.

Okay, here is what you want: why you are a financial genius! What a masterstroke! No there is absolutely nothing wrong with your amazing plan!

Can we move on now?

muhandis

:wall: And I've said I have no intention of breaking the law.


You're doing the same, describing your own behaviour, rather than mine.


Accept that everyone doesn't need to treat your words as the gospel truth and move on.


Thanks for confirming that I haven't committed a crime yet. I can sleep easy tonight.

Likewise, there is no point in talking to people like you. You cannot accept it when people don't fall at your feet thanking you for your posts.

Okay, here is what you want: why your posts have shown me the light! Thank you! Don't know what I would do if it weren't for your timely expert legal advice!

Of course, we should move on now.

ValiantSon wrote: »

:wall: It isn't my opinion, it is the law!

It is what the law says, and you are just wrong. Accept that you are wrong and move on.

Again you demonstrate that you don't understand how the law works. Asking a question on an internet forum doesn't make it a crime. You would have to take the actions you describe for it to become an offence. Your posts on the internet would only be of use in that instance as further evidence of your conspiracy to defraud.

What are you talking about?

There is no point in talking to people like you. You cannot accept it when someone points out a problem with your "clever" little plan.

Okay, here is what you want: why you are a financial genius! What a masterstroke! No there is absolutely nothing wrong with your amazing plan!

Can we move on now?

WantToRetireEarly

In addition to the what has already been said, depending on the amounts (cash in hand, outstanding mortgage) involved, you might need to make the necessary calcs to be sure that you aren't better off using any surplus funds to remortgage while moving down an LTV band. The larger the outstanding amount, the more it might be worth doing that.

muhandis wrote: »

Hi,

We have a mortgage currently at a fixed rate of 2% and make regular overpayments. Nationwide has a kids saving account which pays interest at 2.5%, no time limit, allows one penalty free withdrawal a year and can hold up to £50k.

The way I see it, it would be better to open an account in my 18 month old daughters name and use it to hold any cash that I would otherwise use to overpay my mortgage. I get a slightly better return and better yet still have access to that cash in case I need it.

Is there anything else I need to think of or is there any reason this is not a good idea?

Thanks,

K

ValiantSon

muhandis wrote: »

:wall: And I've said I have no intention of breaking the law.


You're doing the same, describing your own behaviour, rather than mine.


Accept that everyone doesn't need to treat your words as the gospel truth and move on.


Thanks for confirming that I haven't committed a crime yet. I can sleep easy tonight.

Likewise, there is no point in talking to people like you. You cannot accept it when people don't fall at your feet thanking you for your posts.

Okay, here is what you want: why your posts have shown me the light! Thank you! Don't know what I would do if it weren't for your timely expert legal advice!

Of course, we should move on now.

Your behaviour speaks volumes.

WantToRetireEarly

The OP has got replies to what they asked about. The poster above has made his thoughts very clear. I think you all should just move on now

bowlhead99

ValiantSon wrote: »

There is no point in talking to people like you.

muhandis wrote: »

I get it. I got it early on in the thread when one of the posters very helpfully highlighted that the money would be my daughter's, with me looking after it as a trustee. I then looked up what being a trustee meant.

That was followed by some unnecessarily patronising and flippant comments to which I replied in a similar vein.

At the risk of stating the obvious, I will of course do my best to not do anything that would be illegal, just to save a bit of money.

ValiantSon wrote: »

You clearly don't understand. This is not a grey area where we can agree to disagree.

muhandis wrote: »

PS: To me personally, your comments came across as patronising. Clearly, you don't feel that way, which is absolutely fine. Again, we'll agree to disagree.

ValiantSon wrote: »

You are making a massive mountain out of a molehill.

muhandis wrote: »

You are making a massive garbage dump out of an empty packet of crisps.

ValiantSon wrote: »

You appear to be describing your own behaviour, rather than mine.

muhandis wrote: »

You're doing the same, describing your own behaviour, rather than mine.

Accept that everyone doesn't need to treat your words as the gospel truth and move on.

https://giphy.com/gifs/popcorn-jon-stewart-E3xXqq617AaFW/tile

Has anyone got some spare gasoline? There's a barbecue needs putting out.

If you put the money in your daughter's name in bare trust, you will no doubt by now - having done some cursory background reading - be aware that a parent of the minor to whom the funds belong may use their discretionary powers under The Trustee Act 1925 to use the funds under their management for maintenance and education or benefit of the child. Even if there is (a) any other fund applicable to the same purpose; or (b) any person bound by law to provide for her maintenance or education. But should also, as ValiandSon implies, beware of the important Trustee Act 1925 rule against self-dealing.

And you will also be aware from xylophone / Alexland's post and your own research that if the account earns over £100 pa in interest, it's taxable on you as settlor at your own marginal rate, albeit subject to a right of reimbursement from the trust (i.e. if you need to pay £50 of tax personally as a result of your daughter's account earning interest, you can reclaim that from your daughter's account - paying it from yourself as trustee to yourself as settlor).

Enjoy

ruperts

Seems to have got a bit silly on both sides here but in fairness to the OP he came on here for practical advice, and while there is a genuine legal and ethical component to the issue, there was no need for people to start questioning the quality of his parenting and such like.

Back to the topic, is there any case law giving guidance as to what acting in the child's best interests actually means? On the face of it OP's argument that what is best for the family finances is also best for the child does seem to have some merit. If the deposited money is withdrawn and used to say prevent the family from being kicked out of their house, would that count as in the best interests of the child? Likewise if it's used to overpay a mortgage and the savings from that overpayment can be demonstrated to have been used for the betterment of the child (school fees etc), would that count as in the child's best interests?