Property funds in child accounts

MaryNB

SuperCommuter said:

Well, everybody here so far, and I'll add myself to the chorus. Why do you think your daughter's name is on the account?

I understand that, but on what grounds do you believe the money is no longer mine? Ethical, legal, or that i am betraying the spirit of the banks terms of conditions? 

Have you read the T&Cs of the account in her name? It's not a case of abiding by the "spirit" of the T&Cs, it's abiding by what is clearly written in them. 

If the T&Cs are in any way similar to the Bath BS T&Cs someone linked above, there isn't just an implication that you can't take money out for you only just because a child's account. It's clearly stated in the T&Cs that they will not permit a withdrawal if it's not in the child's interest (and it's the bank that's makes the judgement call).

You need to check the T&Cs and then clarify with the bank or check with a solicitor if it's not clear. 

Grumpy_chap

SuperCommuter said:

money is held in accounts in my baby daughter's name where i am the sole named adult of the account and have instant access (so not Junior ISAs).  

Is this acceptable as proof of my funds given I have instant access to the accounts and the money came from other accounts of mine? I really don't want to move all this money to accounts in my name and then sit on it for 6 months. I earn around £80 on average per month from her accounts (NS&I prize dependant), so this will mean forgoing a sizeable amount as I've exhausted all my short term cash saving options.

All of the money in your baby daughter's name is her money - these are not your funds.  It was very generous of you making these gifts to your daughter, indeed quite possibly very good IHT planning.  Your influence over these funds is only to act in the best interests of your daughter, in the same way as if you held POA for an adult.  The funds will not become your funds again simply by transferring the money back into an account in your name and it is very difficult to see any basis where a large gift of funds from your baby daughter to you could be seen as acting in her best interests.

SuperCommuter said:

This money is to buy a house for my family (including my daughter) so that we're out of insecure rented accommodation and she has a stable upbringing. 

One solution may be that your baby daughter buys the house in her name (using her money that is in her accounts) and you pay her rent until such time as she comes of age and makes her own decision as to whether she wishes to continue sharing her house with you.

wilfred30

Grumpy_chap said:

SuperCommuter said:

money is held in accounts in my baby daughter's name where i am the sole named adult of the account and have instant access (so not Junior ISAs).  

Is this acceptable as proof of my funds given I have instant access to the accounts and the money came from other accounts of mine? I really don't want to move all this money to accounts in my name and then sit on it for 6 months. I earn around £80 on average per month from her accounts (NS&I prize dependant), so this will mean forgoing a sizeable amount as I've exhausted all my short term cash saving options.

All of the money in your baby daughter's name is her money - these are not your funds.  It was very generous of you making these gifts to your daughter, indeed quite possibly very good IHT planning.  Your influence over these funds is only to act in the best interests of your daughter, in the same way as if you held POA for an adult.  The funds will not become your funds again simply by transferring the money back into an account in your name and it is very difficult to see any basis where a large gift of funds from your baby daughter to you could be seen as acting in her best interests.

SuperCommuter said:

This money is to buy a house for my family (including my daughter) so that we're out of insecure rented accommodation and she has a stable upbringing. 

One solution may be that your baby daughter buys the house in her name (using her money that is in her accounts) and you pay her rent until such time as she comes of age and makes her own decision as to whether she wishes to continue sharing her house with you.

I assume that's tongue in cheek as I'm sure you're aware that a child cannot buy property 

theartfullodger

It's not your money.  Not your money. It's the child's.  Not your funds.  btw some might consider what you're wanting to be a terrible example to the poor child of how they should then manipulate their children's assets.

Making money out of deposits at a time of historically low interest rates is, IMHO, a foolish strategy,especially as we may soon see negative interest rates on savings accounts. Although others may hold alternative views.

I on the other hand wanted my kids to grow up self-sufficient so they could look after themselves and their kids.  Told them they'll inherit nothing as I plan on drinking all my assets.  All 3 sons now property owning, so it kinda worked out in my case.

Best wishes, hope the purchase goes through OK, an interesting gamble buying property at the moment (I've been offloading houses).

AdrianC

Grumpy_chap said:

SuperCommuter said:

This money is to buy a house for my family (including my daughter) so that we're out of insecure rented accommodation and she has a stable upbringing. 

One solution may be that your baby daughter buys the house in her name (using her money that is in her accounts) and you pay her rent until such time as she comes of age and makes her own decision as to whether she wishes to continue sharing her house with you.

In a trust in her name, since she's under 18.
Which the OP would manage, with his strong grasp on financial separation between trustee and beneficiary...

Of course, that would require the baby daughter's trust to be capable of affording the property without a mortgage, since there's no way that the daughter will be able to borrow - or, indeed, repay - a mortgage, and I can't see lenders taking kindly to 90% OP, 10% baby-daughter's-trust joint ownership.

ratechaser

SuperCommuter said:

ratechaser said:

Wow... already wondering if this is a troll post... 

Is is really that strange? Your username `ratechaser` i guess implies you chase the best interest rates. That's all i was doing. 

I do indeed chase the best rates. Where I think we differ is I have so far managed to do so without committing fraud or embezzlement.

The money that has been paid into my children's accounts is theirs now, and theirs to use when they turn 18. They are not a slush fund for me to steal when I want it, under some flimsy rationalisation that they will get the benefit from my doing so.

SuperCommuter

theartfullodger said:

btw some might consider what you're wanting to be a terrible example to the poor child of how they should then manipulate their children's assets.

Some might, but I don't.

I am not manipulating her assets. I really don't see how using interest earned through these accounts is any different from accepting Child Benefit for my daughter.  It is money being used to buy a family home, primarily for her benefit, as renting is inherently insecure. I have been on the receiving end of a S21 in the past and i don't want a repeat of this now I have a family to look after. Perhaps if the government didn't allow landlords the freedom to evict families anytime they feel like it, overheat the housing market, and push savings rates down to 0% then i wouldn't feel compelled to take such 'drastic' measures. 

wilfred30

You just can't admit that you've made a really bad mistake can you?  You will, no doubt, pay for it though when you can't convince anyone that the money doesn't belong to your baby daughter now.

Legally, it is no longer your money now and that's all there is to it.  You are now totally reliant on the bank or whatever where your daughter's Trust account in held.  If they do not decide in your favour, you're stuffed!

SuperCommuter

ratechaser said: 
Where I think we differ is I have so far managed to do so without committing fraud or embezzlement.

It's neither fraud or embezzlement. Let's not get overly emotive here. 

ratechaser said:

The money that has been paid into my children's accounts is theirs now, and theirs to use when they turn 18. They are not a slush fund for me to steal when I want it, under some flimsy rationalisation that they will get the benefit from my doing so.

I'm guessing you already own your own home and your children have security as a result. Assuming that's true then you probably also benefitted from better rates than we have today while saving up for a deposit. Your children will never know the threat of eviction. If i was comfortably housed, then i might also take a moral high ground and judge these methods though i'm not in that position yet. 

JGB1955

I'm fairly sure that 'obtaining a pecuniary advantage by deception' counts as fraud....