Selling my house to give money to my grandchildren

ghdman

I’m a 69 year old man in good health but am thinking of selling my house and giving most of the money to put in trust for my four grandchildren. I’m thinking of just renting for the rest of my life whatever long that may be I don’t know. 

Is this a wise move??
hohn

user1977

Is your grandchildren's need for the money greater than your need for secure housing?

housebuyer143

If your planning to claim UC for your rent they might very well see this as deprivation of assets. How do you plan to fund your rent? 

p00hsticks

housebuyer143 said:

If your planning to claim UC for your rent they might very well see this as deprivation of assets. How do you plan to fund your rent? 

UC isn't an issue as that's a working age benefit and OP says they are 69. 
For those above State Pension Age potentially available benefits would be Pension Credit and/or housing Benefit, but as you say, both are means tested and DWP / Local Authority may well refuse to award these on the grounds that OP has deliberately deprived themselves of assets. 

housebuyer143

p00hsticks said:

housebuyer143 said:

If your planning to claim UC for your rent they might very well see this as deprivation of assets. How do you plan to fund your rent? 

UC isn't an issue as that's a working age benefit and OP says they are 69. 
For those above State Pension Age potentially available benefits would be Pension Credit and/or housing Benefit, but as you say, both are means tested and DWP / Local Authority may well refuse to award these on the grounds that OP has deliberately deprived themselves of assets. 

Good catch! Yes, I basically meant if you want the government to fund the rent they are going to ask where the proceeds from the house sale are - at which point they likely will refuse to pay out due to intentionally depriving yourself of the money 

Mark_d

What are you trying to achieve by doing this?  If all you want to do is leave the proceeds from your house to your grandchildren, then why not do this via a will?

Potentially there might be a way of gifting the property to your grandchildren conditional up on you being able to rent the house (or an annex) for the rest of your life.

Wasting hundreds per month, paying rent to some landlord, doesn't make much sense.  If you have plenty of spare income, perhaps you could sponsor your grandchildren through university

DullGreyGuy

ghdman said:

I’m a 69 year old man in good health but am thinking of selling my house and giving most of the money to put in trust for my four grandchildren. I’m thinking of just renting for the rest of my life whatever long that may be I don’t know. 

Is this a wise move??
hohn

What are you incomes? How do they increase over time? If you live 40 years could you afford rent increasing at RPI for that duration plus utilities, food etc?

You obviously cannot give your assets/money to family and then look to the State/tax payers to cover future short falls. 

_Penny_Dreadful

ghdman said:

I’m a 69 year old man in good health but am thinking of selling my house and giving most of the money to put in trust for my four grandchildren. I’m thinking of just renting for the rest of my life whatever long that may be I don’t know. 

Is this a wise move??
hohn

You want the money put in trust so presumably your grandchildren aren’t old enough to need the money for something like a house deposit or help with university fees. Why not write a will leaving your house to your grandchildren or do you think this is some kind of clever wheeze to avoid potential care home costs in the future? 

Keep_pedalling

Is it a wise move? Almost certainly not. Presumably you don’t have other major assets otherwise you would not have come up with such a mad plan. 

theartfullodger

Nah.  Young kids growing up knowing there's a big bag of loot coming to them  ( they'll find out, they'll find out - if only ... ? why's grandad in that pokey flat and short of money ?)  will get complacent and lazy (ish, mainly, for most).

IMHO a terrible thing to do. 

Artful, 8 grandkids, 3 sons...

propertyrental

My guess is that the OP wants to remove the money/property value from his Estate and thus avoid potential Inheritance Tax.

Given that he says he can afford to rent for the remainder of his life, either he has considerable savings (hence IHT is a genuine consideration) or considerable pension income.

Certainly it's worth looking at putting cash into a Trust, or perhaps a Life Policy that pays out to Trustees (eg his children) on his death.

The biggest downside to this plan is the insecurity that comes with renting.

The Gov seems to be back-tracking on the removal of S21, but even if S21 IS removed, there will still be circumstances allowing a landlord to evict (cf Scotland where sale of the property permits eviction).

The risk of eviction, at age 70 or whenever, is not to be taken lightly.