Money left to my children
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rozzibee
Posts: 1 Newbie
Hi. My dad passed away this year. He’s left some money to my children. It’s works out at about £800 each for them. They are 10, 7 and 5 so I don’t want to give it to them yet. I was thinking along the lines of their 18th or 21st birthdays. What do you think is the best thing to do with it? I don’t want anything high risk.
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Hi. My dad passed away this year. He’s left some money to my children. It’s works out at about £800 each for them. They are 10, 7 and 5 so I don’t want to give it to them yet. I was thinking along the lines of their 18th or 21st birthdays. What do you think is the best thing to do with it? I don’t want anything high risk.
They will be entitled to their inheritance on their 18th birthday (16 if you live in Scotland) so forget leaving it until their 21st birthday.
A junior ISA would be the best place for the money as it can’t be withdrawn until they are entitled to it. The current best rate is 3.6% with the Coventry BS, but I would be looking at a S&S ISA rather than cash especially for the younger children.0 -
Keep_pedalling wrote: »They will be entitled to their inheritance on their 18th birthday (16 if you live in Scotland) so forget leaving it until their 21st birthday.
A junior ISA would be the best place for the money as it can’t be withdrawn until they are entitled to it. The current best rate is 3.6% with the Coventry BS, but I would be looking at a S&S ISA rather than cash especially for the younger children.
....but if they dont know the money exits (or where its come from) then they cant demand it at 18;)0 -
....but if they dont know the money exits (or where its come from) then they cant demand it at 18;)
It only costs a couple of quid to get a copy of a will. Would you risk a family bust up over a small inheritance?
If the OP kept the money in their own name the children might never see it. If the died or lost mental capacity no one else is going to know it exists. If they ran into financial difficulties it might get taken by creditors.0 -
....but if they dont know the money exits (or where its come from) then they cant demand it at 18;)
... which is why wills have trustees and why, by default, parents can't give valid receipts for their children's legacies
And if the will did give that provision, it was presumably under the impression that they would do the right thing0 -
Hi. My dad passed away this year. He’s left some money to my children. It’s works out at about £800 each for them. They are 10, 7 and 5 so I don’t want to give it to them yet. I was thinking along the lines of their 18th or 21st birthdays. What do you think is the best thing to do with it? I don’t want anything high risk.
One option to think about is opening a Junior ISA. This comes in two types.
(a) Junior Cash ISA. This is savings account, if money is required within 5 years it should be kept in a savings account.
https://www.moneysavingexpert.com/savings/junior-isa/
(b) Junior Stocks & Shares ISA. This is an investment, so there is some risk involved.
If the money is invested in a low cost global multi asset fund with wide diversification until the children are 18, the risk of making a loss should be low. Especially if the dividends are re-invested in the fund.
If you pick this type of fund then they will have the world economy and inflation work for them.
There are many funds of this type. Two which you might like to consider are:-
https://www.vanguardinvestor.co.uk/investing-explained/what-are-lifestrategy-funds?intcmpgn=lifestrategyfunds_learnmore_link
https://www.hsbc.co.uk/investments/isas/hsbc-global-strategy-portfolios/
You can chose which risk level or share/bond split you wish to take on.
If you watch this, it will give you the basic idea:-
https://www.kroijer.com/0 -
I am more comfortable taking S&S risk with money I have gifted (or will gift) to our children but am more cautious with money gifted from others. If you put the money in a best buy table Cash Junior ISA you should get at least an inflation level of return which will preserve the spending power. Remember to consider if they already have Child Trust Funds that would need to be transferred into a new Junior ISA.
Alex0 -
Think I read, probably somewhere on here, that the beneficiaries have the right to expect that the money was suitably invested. Given the investment timescale, that would mean at least an element of equity investment.
Seems to me that this would be ideal opportunity for the multiasset global trackers everybody loves0 -
10, 7 and 5
Don't they all have CTF/JISA which seems the ideal home?0 -
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Malthusian wrote: »Hiding people's own money from them is a daft idea.
Apart from anything else, they might inadvertantly commit benefit fraud or tax evasion.
Youre not really hiding or committing fraud. The money will still be in the kids name, they just wont know they have it.0
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