Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • Keeping Positive
    • By Keeping Positive 24th Apr 08, 1:17 PM
    • 4,665Posts
    • 9,363Thanks
    Keeping Positive
    Do I use childrens savings to pay off debt?
    • #1
    • 24th Apr 08, 1:17 PM
    Do I use childrens savings to pay off debt? 24th Apr 08 at 1:17 PM
    Hi

    I have three children 10 7 and 5 with dormant savings accounts currently getting 4.98 aer a year. I cant touch the youngest but the older two can take money out if they want (they dont know this). Do I use the £1.3k to pay towards my loan currently fixed at 6.9 APR and pay them back when I am debt free or just leave it?

    I havent paid anything in to the accounts for a few years now while struggling with monies. We are now on an even keal with good wages and good budget thats been working for six months now.

    The loan payments wont reduce but it would bring forward dfd including lowering interest paid.

    Is this sensible moneysaving or selfish? I am 50/50 on it. Logic says using loan most cash efficient but heart says not fair to use the kids money (all from us not other relatives).

    Thanks for reading and your opinions.

    This Forum Tip was included in MoneySavingExpert's weekly email

    Don't miss out on new deals, loopholes, and vouchers

    Last edited by Former MSE Wendy; 29-04-2008 at 7:01 PM.
    May 2013 new beginnings
Page 1
    • itsnever2lateisit?
    • By itsnever2lateisit? 24th Apr 08, 1:20 PM
    • 841 Posts
    • 913 Thanks
    itsnever2lateisit?
    • #2
    • 24th Apr 08, 1:20 PM
    • #2
    • 24th Apr 08, 1:20 PM
    If the accounts are in the names of your offspring, then you should only withdraw the money for their benefit
    Debt @ LBM 04/07 14,80401/08 10,472now debt free

    Target: Stay debt free
    • (Land of) Maz
    • By (Land of) Maz 24th Apr 08, 1:23 PM
    • 11,044 Posts
    • 11,457 Thanks
    (Land of) Maz
    • #3
    • 24th Apr 08, 1:23 PM
    • #3
    • 24th Apr 08, 1:23 PM
    Hi there, if you are on an even keel i would say no....... if it was desperate and a matter of life n death or rent and groceries then maybe... but as you seem to be over the worst i would say that if you can, leave it.

    It's only going to bring your DFD forward not avert a creditor crisis or CCJ or anything, so i think i'd try not to.

    That said my DD has got a few hundred in the bank and i am regularly down to the coins in my purse... i have "borrowed" from her piggy bank hard cash (5/10) but never taken it out of her bank unless it was to specifically buy her something, or for her holiday spends.

    And i try to put the cash back in plus a couple of quid once i'm in the black again.

    Good question, can't wait to see the answers!
    I'm just a seething mass of contradictions....
    (it's part of my charm!)
  • rayday2
    • #4
    • 24th Apr 08, 1:28 PM
    • #4
    • 24th Apr 08, 1:28 PM
    If you can't touch the youngest but you can the eldest then no its not fair. Also your eldest will need the money sooner than the youngest.

    Unless its an emergency definately no. You have already said that you have not paid in them for ages so chances are you will not be able to replace or compensate them in lost interest for years.
  • thepinkladez
    • #5
    • 24th Apr 08, 1:29 PM
    • #5
    • 24th Apr 08, 1:29 PM
    i agree with the others onthis one, that as your debt isn't serious and the money wouldn't make a huge difference i think leave it. However if it meant a huge difference i would have said yes, i figure what is the point of your children having savings if they end up homeless?!
  • Broken hearted
    • #6
    • 24th Apr 08, 1:33 PM
    • #6
    • 24th Apr 08, 1:33 PM
    If you need the money to keepa roof over your head and food on the table then taking the money is best for everyone,if not then leave it alone.
    Barclaycard 3800

    Nothing to do but hibernate till spring






    • Cleosmum
    • By Cleosmum 24th Apr 08, 1:35 PM
    • 2,659 Posts
    • 9,288 Thanks
    Cleosmum
    • #7
    • 24th Apr 08, 1:35 PM
    • #7
    • 24th Apr 08, 1:35 PM
    I have used £20 from the kids accounts when things have been dire ie no food but I have always paid it back in as soon as my money is sorted, usually within a week. I would say dont use it to pay off debts.
    Jan 2016 Grocery Challenge: 184.58/400 (16/01)
  • hectoriess3000
    • #8
    • 24th Apr 08, 1:41 PM
    • #8
    • 24th Apr 08, 1:41 PM
    I would personnally leave the money where it is unless it was a real emergency. You will dip into it to pay off your debts and will never have the money to put back again, something will always come up.

    Mum done that to our bank accounts when we were younger, a few quid here and a few quid there with the intentions of paying it back, by the time we were old enough to understand all we had left in the account was coppers and absolutely nothing to show for it.

    Think of their faces if the same happens with you, how are they going to feel? I know how I felt.
  • LilacPixie
    • #9
    • 24th Apr 08, 1:46 PM
    • #9
    • 24th Apr 08, 1:46 PM
    As you are on an even keel again and you have a working budget then no i would leave them where it is.

    Its totally different if the money would stave off eviction or something.
    MF aim 10th December 2020
    MFW 2012 no86 OP 0/2000
    • dancingfairy
    • By dancingfairy 24th Apr 08, 1:47 PM
    • 8,961 Posts
    • 7,344 Thanks
    dancingfairy
    As the general consensus has been to leave the money alone might I suggest you move it to a better account for them as they don't seem to be paying much interest. Also don't forget to fill in a form stating they don't need to pay tax. Well they won't if they don't earn over the tax limit anyway - I don't think banks do this - I think you need to ask specifically for the form. Anyway I'm sure Martin has a good article on children's savings accounts somewhere. Think what a difference a good interest rate will make - especially since they don't have to pay tax at the moment.

    Martin's article is here;
    http://www.moneysavingexpert.com/savings/child-savings-tax-free
    Making my money go further with MSE
    How much can I save in 2012 challenge
    75/1200
  • rayday2
    I would personnally leave the money where it is unless it was a real emergency. You will dip into it to pay off your debts and will never have the money to put back again, something will always come up.

    Mum done that to our bank accounts when we were younger, a few quid here and a few quid there with the intentions of paying it back, by the time we were old enough to understand all we had left in the account was coppers and absolutely nothing to show for it.

    Think of their faces if the same happens with you, how are they going to feel? I know how I felt.
    Originally posted by hectoriess3000
    Same happened to us as children but really narks me is that well meaning auties and friends of the family had given us cheques as presents especially me with a birthday days after Christmas.

    Last year I did raid the childrens savings as MIL was in intensive care on life support and we had no spare cash for hotel. I felt really bad at the time - happily I can say now there is more in there than this time last year but it still worries me they will see those outgoigns in the bank books.
  • Broken hearted
    I'm sorry but I'd rather the kids had a good childhood and no savings than loads of savings and no childhood.
    Barclaycard 3800

    Nothing to do but hibernate till spring






    • Keeping Positive
    • By Keeping Positive 24th Apr 08, 1:58 PM
    • 4,665 Posts
    • 9,363 Thanks
    Keeping Positive
    Thank you guys. I would never forgive myself if I couldnt pay them back. I will look for better interest though for the oldest two I think youngest is stuck for another 18 months. He has a government account as well.

    Monies wil be left alone but we may use some for thier passports as they are desperate to go abroad. Was thinking of a cheap camping trip to France next year which I hope you agree will benefit them. Subject to budget of course!
    May 2013 new beginnings
  • rayday2
    I'm sorry but I'd rather the kids had a good childhood and no savings than loads of savings and no childhood.
    Originally posted by Broken hearted
    Its not about good or bad childhoods.

    I hope my children will be helped out when it comes to university, or wanting driving lessons its about opportunities and choices.

    Just because a child has savings does not mean they have a bad childhood - you can do both!
  • Broken hearted
    Not everyone can
    Barclaycard 3800

    Nothing to do but hibernate till spring






    • dancingfairy
    • By dancingfairy 24th Apr 08, 2:10 PM
    • 8,961 Posts
    • 7,344 Thanks
    dancingfairy
    It's a question of priorities isn't it. Which is more important to you using the money and becoming debt free, saving money on the interest or knowing that it's there for the children and unless there was a dire emergency you wouldn't use it. There is no right or wrong answer, I think you have to make the best choices you can for yourself and your children. I think it is a horrible situation to be in to even have to contemplate but know that sometimes people don't have a choice in the matter and/or it would make significant difference to the standard of living for the family.
    Making my money go further with MSE
    How much can I save in 2012 challenge
    75/1200
  • Bismarck
    I would use the savings to avoid repossession/eviction. ..Would I sell the car that essentially provides an important use to them to pay the mortgage before using children's savings...hmm...that's a good one.
    For what I've done...I start again...And whatever pain may come ...Today this ends... I'm forgiving what I've done -AF since June 2007
    • Keeping Positive
    • By Keeping Positive 24th Apr 08, 3:15 PM
    • 4,665 Posts
    • 9,363 Thanks
    Keeping Positive
    I think the main thing is we are coping and trying to raise extra for a few treats by doing the Grocery Challenge, second hand clothes, ebaying, carbooting etc. I want my kids to respect money but also to be able to remember fun times when growing up.

    If for some reason things turned bad I definately would use the monies. Right now its not essential just trying to think of moneysaving ways to be debt free and do whats best for our kids.
    May 2013 new beginnings
    • (Land of) Maz
    • By (Land of) Maz 24th Apr 08, 3:59 PM
    • 11,044 Posts
    • 11,457 Thanks
    (Land of) Maz
    Wendy, i think you've got your answer hun. And i think it was the one you would have expected.

    Well done on getting this far without using it at the really desperate times!

    and yes, i would use it to put towards their passports if you need to. That's not unreasonable.

    Isn't this forum a great place at times!!?
    I'm just a seething mass of contradictions....
    (it's part of my charm!)
    • pandapaws
    • By pandapaws 24th Apr 08, 4:07 PM
    • 2,110 Posts
    • 3,577 Thanks
    pandapaws
    I agree with the general concensus, not just for the moral reasons about it being the kids' money, but also because it is a bit of security for you as well - if you ever do get really desperate then you know it's there.

    We currently owe my son 300, for 250 we transferred/nicked from his Halifax account to our own to avoid us getting a 40 overdraft charge. Didn't like doing it, but it made far more sense than wasting 40. We decided to pay the 40 to him rather than Halifax, so will repay 290. (The other tenner was nicked out his piggy bank because the nearest cashpoint is miles away and the Chinese here don't take Switch! ) It will all get paid back with interest though just as soon as I'm next near the bank.
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

149Posts Today

1,366Users online

Martin's Twitter