Money Moral Dilemma: Should my eldest child split their Child Trust Fund savings with my youngest?

silvercar

Sly said:

I'm surprised at the judgement from others without knowing the financial situation of the poster. I guess it is unsurprising many MSE users are privileged, and perhaps most imagine the poster is too and has at least enough to save even a little. However, you don't know that. I'm not suggesting opinions shouldn't be shared, they are valid and welcome. However, ideally we could do that whilst also being mindful of the level of inequality in the UK and therefore, make less assumptions and judgements.

If the poster can’t afford to offer similar savings to the other child, they still shouldn’t expect sibling support. 

DeLaSole

I sympathasise if the questioner has not been in a position to personally support the 3rd child in the absence of a CTF. However, the money was for the specific child and it is theirs to do with as they wish - they do not have parental responsibility for their siblings.

Throughout their lives, families with multiple children will likely to be impacted by various things: from funded childcare being limited/extended right through to the age at which their State Pension may be available to them. That's life, and it's not for an individual child to have to pay out to 'equalise' the impact of goverment policy on their siblings.

Ultimately, if it has been difficult for the parents to provide £hundreds into a fund for the 3rd child across a 12-year period, it would be more important to try to address that, whether it be through improved pay and/or ensuring they are receiving any support they are eligible for.

Tacker35

Unfortunately life is not fair and if parents insist that everything is fair for their children growing up then when those children go out into the world they are in for a shock. Better for the parents to explain that life is not fair and they need to deal with this. As long as the parents do not show a bias for or against any part of the family that is the best way to train their children for the world they will face.

boot73

No! That's not fair at all! If you want your youngest to have the same, then start saving for them! 

Ralph_the_Cat

This isn’t a dilemma because this isn’t your money. Not only that, your formula for making things in your mind ‘fair’, is non-sensical.

If you want to make it ‘fair’, you can easily do that yourself as the parent. Simply top up the middle child’s CTF to the equivalent of £880 when it matures and then gift your third child the equivalent if £880 when they turn 18.

What you do is up to you, but you have no right at all (morally or legally) to pass on this responsibility to your children.

IvonH

On the face of it, if this were a purely mathematical problem, it would make sense.  The eldest got 500, the middle one 250 and the youngest nothing - so split the eldest's money and give it to the youngest and every child had the same.  However, this is about much more than maths.
If the eldest does not want to share, you create a rod with which you will be beaten for the rest of your life (and probably beyond.)  
Your role should be to try and sort things so every child is treated equally (you had many years to do this...)  Top up the middle child's fund and start one for the youngest.  By all means, make it clear that xyz can't be bought because you have to ensure that the youngest child(ren) get/s the same as the eldest to teach a valuable lesson on financial planning.

Pollycat

IvonH said:

On the face of it, if this were a purely mathematical problem, it would make sense.  The eldest got 500, the middle one 250 and the youngest nothing - so split the eldest's money and give it to the youngest and every child had the same.  However, this is about much more than maths.
If the eldest does not want to share, you create a rod with which you will be beaten for the rest of your life (and probably beyond.)  
Your role should be to try and sort things so every child is treated equally (you had many years to do this...)  Top up the middle child's fund and start one for the youngest.  By all means, make it clear that xyz can't be bought because you have to ensure that the youngest child(ren) get/s the same as the eldest to teach a valuable lesson on financial planning.

No, it doesn't make sense.
The eldest actually got £880.
We don't know how much the middle child's trust fund will be.

If I were the eldest child I would be furious that my parent has suggested that I give half of the money to my youngest sibling.

Anyway, this makes it perfectly clear who the money belongs to and therefore this dilemma is nonsense.

Paying into a Child Trust Fund

You can continue to add up to £9,000 a year to an existing Child Trust Fund account. The money belongs to the child and they can only take it out when they’re 18. They can take control of the account when they’re 16.

Child Trust Fund: Overview - GOV.UK (www.gov.uk)

What happens when your child is 18

On your child’s 18th birthday, the Child Trust Fund matures. This means that:

• your child automatically takes over the account
• no more money can be added

Your child can either:

• take out the money
• transfer the money to an adult ISA

The Child Trust Fund will then close.

Until your child withdraws or transfers the money, it stays in an account that no one else has access to.

It belongs to the child. Not to the parents or any other sibling.
It belongs to the child for whom it was set up.
So to the author of this MMD - hands off money that doesn't belong to you.

It doesn't matter what anybody else thinks.
It doesn't matter what anyone else would do.
It's what the eldest child wants to do.
And the eldest child does not want to do this:

I think they should give half to my third child

Stato71

No it's that child's money given to them by the state.  Unfortunately the government withdrew the benefit which is unfair on your 3rd child and others in the same situation, poor government policy in my opinion. What you should do  is open a Junior ISA for your youngest child and drip feed money into now it until you've paid in the same amount if you are concerned about the unfairness of the situation.  You should also have transferred your 2nd childs CTF to a Junior ISA and drip feed that to make it up as well.  CFT's and JISA's are a great way to give children a nest egg when they get to 18, but the cash option isn't the right one over that period of time, equity trackers would give better returns.  With 5 or 6 years to go before your 3rd child gets to 18 you have time to balance things out or at least make a stab at it with JISA's.

AmethystEmerald

Agree with the majority of the posts.
No, it belongs to the eldest child and them alone. 
If that concerned like many saying you should have started some sort of savings for the youngest when they were born.

Gillby1

Really disappointed in the number of judgemental and quite frankly responses to this reasonable question, especially given the assumptions being made. Nice to see a few helpful suggestions though 👏👏

Personally I would ask the eldest to consider sharing the money, but wouldn't expect him to and wouldn't push the issue. I definitely wouldn't have wanted to share at that age, but as adults my sister and I have helped each other out financially many times! 😁

I would try to save an equivalent amount of money for the youngest, if I was in a position to do so. If not, it's important to explain the situation now so the younger children know what to expect. I realise that will be difficult - adolescents aren't known for being selfless and understanding, and as their parent it's horrible to see them feeling like they've been treated unfairly. And it IS unfair, but it certainly isn't your fault. Hope you manage to work things out. 😊