Children's Inheritance

thechubbyunicorn

My husband died recently and left money (approx £8k each) for his niece & nephew (8 and 14 years old). I am to have control over this until they are 21. The money will be theirs at 21 however he had specified he wanted this to cover driving lessons, money towards a car or house if applicable before they reach 21. I do not wish to involve their parents as I fear the money may not end up as DH intended therefore I think this rules out a child isa. I would also like to contribute a small amount each month (maybe £20).

Where can I put this money?

We are in Scotland if this makes any difference.

Keep_pedalling

In reality for small bequests such as this the stipulation that they can’t receive it until they are 21 is not legally binding in most cases. Unless his will specified that the bequest went to someone else in the event that they died before reaching 21 or that it was to be held in a discretionary trust then they are actually entitled to the money on their 18th birthday.

Perhaps you could give the exact wording the will gives regarding these bequests (retract any personal info) so we can advise appropriately.

Assuming this is the case then the simplest option would be to use a JISA for each of them. One of their parents would need to open them (assuming they don’t already have one that can be used) but you should be able to deposit the money directly to the accounts.

flaneurs_lobster

 Unless his will specified that the bequest went to someone else in the event that they died before reaching 21 or that it was to be held in a discretionary trust then they are actually entitled to the money on their 18th birthday.

In Scotland, that age is 16.

thechubbyunicorn

Thank you @Keep_pedalling

The will states: "Declaring in the event of any residuary legatees not having then attained the age of twenty one years at the date of my death I direct my Trustees to retain in their own names the share of residue bequeathed to such legatee until he or she shall have attainted said age when they shall make payment to him or her of his or her said share of residue together with all accumulation of income, if any thereon; And I provide that until payment shall be made my Trustees shall have full power."

I believe a JISA requires a parent to open and have control over the account. DH specified this wasn't to happen as their parents are financially reckless and the children unfortunately would be unlikely to benefit from the money in this scenario.

Exodi

thechubbyunicorn

I believe a JISA requires a parent to open and have control over the account. DH specified this wasn't to happen as their parents are financially reckless and the children unfortunately would be unlikely to benefit from the money in this scenario.

What was the particular concern out of interest?

While a parent can manage a JISA, they can not withdraw from it, except under very specific circumstances such as terminal illness or death. Outside of this, the child can usually manage the account themselves when they turn 16 and withdraw from it when they turn 18 (where it converts into an adult account):

https://www.scottishfriendly.co.uk/help-support/support-hub/guide-to-junior-isas

https://www.gov.uk/guidance/close-void-or-withdraw-investments-from-a-junior-isa-as-an-isa-manager

Unless you think the parents might coerce their 18 year old to share the money or invest recklessly?

thechubbyunicorn

Thank you @Exodi

DH and I considered that if the parents were aware how much money there was the children (at 18 with access to the account) could be coerced into letting their parents 'borrow' the money which would then never be returned (as has happened in the past).

DH was very specific about funds being available for them to have driving lessons / buy a car at 17 if they wished.

Bigwheels1111

Wills are an interesting subject, my will with my late wife.

After everything stated in it, ie everything goes to me, when I die x goes to my brother, X her son etc.

X to niece and grandchildren.

There is a clause, mine states,

Although my wife is making a will in terms similar to the terms of this will the wills are not intended to be mutually irrevocable and each of us is free to alter the disposition of his estate in any way and any time without reference to each other.

In basic terms I’m not held by the will if I changed my mind.

I have made a new will and most of it is the same.

As our niece is 21 this year I’ve decided to give her the inheritance early as I can afford it.

In your case, you which to honour it, then do so.

Put the money in a savings account and provide the siblings with a cheque when they reach the age you agreed on. Including any interest accrued.

Nice and simple.

Albermarle

Put the money in a savings account and provide the siblings with a cheque when they reach the age you agreed on. Including any interest accrued.

Nice and simple.

Probably the most practical solution, but would not be legally correct.

thechubbyunicorn

Thank you @Bigwheels1111 & @Albermarle I did consider this but I don't want there to be any repercussions of this at a later date (not really sure what that would be). I'd 100% ensure the children got their fair and correct share but I also want everything to be done above board.

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/81962451#Comment_81962451

The point to to worry about I suppose, is that wills are in the public domain. The parents of the children could see the will ( if they looked ), and see that money was left to their children and could accuse you of snaffling it for yourselves.

Bigwheels1111

https://forums.moneysavingexpert.com/discussion/comment/81962700#Comment_81962700

This is why you get a new will drafted and signed.

Things have changed, we agreed that no body got anything until we both passed.

I did not want my wife to give money away and not have enough in later life to live on.