Money Moral Dilemma: Should I give my nephew £10,000 now even though he'll likely fritter it away?

MSE_Kelvin

This week's MoneySaver who wants advice asks...

Following a small inheritance I received four years ago, I gave my niece £10,000 towards a house deposit. I want to do the same for my nephew, her brother, but his life's very different. Although he's 29 he's not saving for anything in particular, and his parents say any money that comes his way quickly disappears on expensive restaurants. But I'm not keen on delaying giving it to him indefinitely as I'm getting older and Inheritance Tax could become an issue.

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Brie

Tell him to open a LISA and drop it in there.

Ms_Chocaholic

If IHT is becoming an issue and you are getting older you need to start spending your money

In terms of the £10k to your nephew, does £10k make you go over the IHT threshold

Sea_Shell

Give another £10k to your niece 😉

If IHT is the main driver of the gifts, rather than fairness.

Are they ultimately your beneficiaries?  You could bequest him a larger percentage to "compensate".

elsien

Presuming there would be enough left in the estate at that point to be able to gift? 

Baldytyke88

Where is he living, could you put it in LISA or a SIPP for him. Then it sounds like you may have lots more money to give away, do that.

lincroft1710

If you're worrying about something you personally will never have to pay, then if it makes the worry go away, just give the nephew the £10,000. If he is profligate that's another problem you don't have to worry about, he is an adult and sometimes adults have to learn by their mistakes (or unwise actions)

CapeTown

You don't have to give him anything. My son is a bit of a spender.  I have put money in a premium bond account for him. He cannot touch it until he buys a house

Sueh_2

When my Grandchildren were born, I took out a Baby Bond for each of them which would mature on their 18th Birthday. They all grew up knowing - no tattoos or piercings, but everything else was up to them. You just have to trust them not to waste it. So far none of them have. One put it towards a house deposit, one towards a car and one for a trip to Australia to go travelling. The last one gets theirs in a couple of weeks 🙂

Andrea9876

Can you speak to a financial advisor about putting it into a trust conditional on it being for a house deposit 

mimgable

If you don’t want the money used on general fun stuff, just keep it till he wants to buy a house and contribute to deposit/cost of it. Say it’s same deal as niece…use for house deposit as and when the time comes. Or other concrete item, as it seems you want a concrete thing for it to be used for. 

Loosing some in inheritance tax if it’s held back is maybe better than it getting given the pockets of restaurant owners?? (Given you seem to want something concrete for it to be used on)