Should we downsize to help our adult children out?

Please don't move, you are happy where you are with facilities and GP etc within distance. You are not living in a mansion and we don't know what will happen tomorrow never mind in 2 years time. They each have a roof over their heads, let them sort their own lives out.

Allsorts

You would probably have to move area. The national average for a semi is about 400k.
If you are not able to get a place in the area you are in and you I would stay put. However if there is a cheaper alternative in a place you have all the amenities in I would soendcsone yime there and if it was good I would move. Makes things easier later on. I should have moved years ago, but with a diffucult build next door think I left it too late.

In my area, of scotland you could buy a very well built upmarket apartment in a pleasant development with grounds for half the price of a 3 bed similar home to yours. In fact many older, active people are doing exactly that to free up a substantial chunk of money to travel, indulge themselves, whatever. They find their new neighbours are people like themselves; mature, comfortabl;e, sensible planners. All within the area they've lived in for years and know well.

You have to factor in legal fees tax and moving costs. But there will be lifetime financial advantages of lower heating insurance and and maintenance costs.

With the resulting money you could divide in four; 3 shares to the children and one to your self for holidays, travel etc.

Thank you all.
Really appreciate your advice.

A really good point from Jaxjacky about the need at our age to preserve our assets in case they are needed for care in the future.

We have no way of knowing what the future holds, and care homes, and even assisted living flats come to that, are eye wateringly expensive.

JenniRen 11:07

Who knows, I just know our younger son does (or did) drive to absolute despair until he met his most recent gf, she’s 4 years older than him and been self employed all her working life and has really sorted him out in terms of organisation and finances!! Here’s hoping it lasts, as not only is she very sensible and practical, she’s a truly lovely girl!

My son lives in a tiny house in a very beautiful area full of the most gorgeous houses. It’s one of those little oases of calm you sometimes find in big cities. I know from my own failed marriage that our marriage would have been happier if we’d had more space. So every now and again I do the lottery and fantasise about which house I will buy for him. They both work so hard and because of my divorce I can’t help them financially. If I was still with his father we would have helped them to buy a nicer house so, even though I wasn’t the one that left the marriage I feel so guilty.

It's not just downsizing and releasing funds . You need to weigh up the actual cost to you which will also eat into the amount you would have available to pass on such as stamp duty. The first 125,000 has no charge but after that its
2% on 125,000 - 250,000
5% on 250,000 - 925,000
Then there's the legal fees and moving costs not to mention the stress selling and buying can cause.
Like others have said, stay put.

I'm really surprised at so many 'stay put and don't help your DC' answers. Why make your DC wait until you are gone and then have to pay a fat chunk of inheritance tax on the property value when you could downsize and help them now? At the very least you could start looking at smaller properties, even if you don't proceed. It amazes me that people ask random internet strangers about such important things.

Quercus

I'm really surprised at so many 'stay put and don't help your DC' answers. Why make your DC wait until you are gone and then have to pay a fat chunk of inheritance tax on the property value when you could downsize and help them now? At the very least you could start looking at smaller properties, even if you don't proceed. It amazes me that people ask random internet strangers about such important things.

Why should we travel second class to allow our children to travel first class?

It’s the have it all generation.

I think all of us would move heaven and earth for our children in an emergency, Quercus.

Smileless2012

Downsizing should only be done IMO if it's what you want for yourselves.

Agree completely with this. If for completely independent reasons you have come to the conclusion that you would like to move for whatever reason that might be, bored and want a change of area; garden too big as you age; no garden you would like one; move to area with better NHS facilities- then and then only should you move.
A very important point was the value of the asset to fund care in later life or medical care now. As well also pointed out was the changeability of the young ( as it should be). Divorce that splits that lump of cash you sold your lovely home for in two? Mainly you sound as if you really love your house and location. You should keep them.

A friend has just done this - in fact they’ve given their big, self-built house to their son and his family and bought a 4 bed new build some miles, away for themselves, cash purchase. She is 71, a few years older than her DH.

We did it the other way around and bought the DDs their first homes, when each was 21. Obviously we had to find the 25% deposits, but added their mortgages to ours (this was 25 years ago) giving an eye watering monthly payment! We had decided that any inheritance we might receive would pay a chunk of it off and DH’s tax free lump sum from his early retirement paid off the rest.

Now I’m spending their inheritance!!

How nice, georgesgran to be able to do this.

Not many of us can afford to have three mortgages - or to even be a cash buyer. Most need to sell our own homes in order to move.

Umm. Be careful.

If you need care in the future and you have limited funds, your Local Authority can reclaim the gifted money (the '7-year Rule' does NOT apply), which could affect your children considerably.
.

Sago

Quercus

I'm really surprised at so many 'stay put and don't help your DC' answers. Why make your DC wait until you are gone and then have to pay a fat chunk of inheritance tax on the property value when you could downsize and help them now? At the very least you could start looking at smaller properties, even if you don't proceed. It amazes me that people ask random internet strangers about such important things.

Why should we travel second class to allow our children to travel first class?

It’s the have it all generation.

IME downsizing is nothing like travelling second class.

More like being in my own private jet plane with excellent services on hand. So convenient and hassle free.

I'd not sell.

We have 3 adult children, 2 of whom could do with a bit of financial help to get them a bigger place. ( my son lives in a tiny flat that he hates - he’s single btw )

Perhaps ask the 2 AC you feel need help IF they actually want help?

I'd gift out of income and keep our home.

If your children borrowed the money could they afford the monthly payments, You could then act as guarantor for their mortgage using the house as security.

When DD left home this is what we did. Within 10 years she had got income enough to not need us as gurantors.

Alternatively take equity release. The interest does not have to roll up. If you can afford it, pay the interest, so that the amount outstanding does not increase.

I’m not sure that I would actually sell a home that I was very happy in but the desire to help children out is very strong.
You are ‘only’ 63 so still quite young and looking forward to the fruits of your labours.
How much money would your children need? How many children do you have? We have 2, one we have helped by quite a sum (our frittering away in retirement money!) the second has to wait for hers until we die or sell. She earns lots of money and does not need our financial help. We have made sure that our wills make sure it all evens up and they both know this.
Perhaps your son wouldn’t need a huge amount to get him onto the next stage?
Do keep all your children in the loop.

I'm watching with interest.
I'm mid downsizing.
It had crossed my mind that I could gift my 4 DC part of their inheritance but I am not sure.
I think they should be grateful that I'm doing this downsizing now whilst still compus mentis so saving them the bother later.

When DM died 18 yes ago I divided my inheritance between them to help out with their expenses at the time.

They all have their own houses and are reasonably secure.

DSiL actually told me to make sure I had enough for a comfortable future and not to spend rashly.

It's difficult isnt it downsizing from an ordinary 3 bed semi to what? A leasehold flat or a house in a cheaper area away from friends and familiar places.
Unless you want to move for whatever reason, dont, you will hate it, if or course you have spare wealth doing nothing in particular then help the but look after yourself first.

David says it all very clearly. I'm just adding, you are not old. Make sure your money will last the decades of retirement (should you be so lucky) and keep enough equity to pay for possible care in old age.
In other words, if you love your home, stay put.

Be careful what you do. In just 10 months, DD has become likely permanently disabled (wheelchair and housebound) and I am currently desperately struggling with late-onset side-effects of radiotherapy treatment 3 years ago., with two MRI scans due tomorrow and Saturday. It initially cost us nearly £1,200 a week for two hours a day of care workers (we reduce it to 30% of that eventually but with my new cancer issues we are struggling badly to cope. Thus, even if DH stays at home not far off £60k a year will be gone quite apart from the fact that I can no longer manage our large house and garden (which I have never loved, but he does - even though he can barely see the garden and certainly is unlikely to be able to get out into it ever again. We went into retirement thinking we were very comfortable but these costs have been an eye-opener. There are also tons of extra costs on equipment, washing, paying a gardener and cleaner, finding an oddjob man is a nightmare and so on. Full time care in this area (N Derbyshire) would be approaching £100k a year EACH so it wouldn't take long before we were in the doghouse.

Fortunately we helped our DDs out years ago when they were embarking on their first homes, which proved a good idea. But in whatever time we now have left we don't intend spending it in pain and squalor. If two of us are ill, our capital won't last for long.

If they struggle to manage on their own then they should downsize and move. Move in with you to get their independence abilities back on track. You have already succeeded. Dont enable them. Did anyone enable you?

I wouldn’t move if you love your house and garden and you’re happy where you live . Your AC are on the property ladder .
You’re 63 , do you want to spend your retirement in a 2 bed flat with no garden ?
Moving is expensive and you need to think of your future , and will you need care later on in life?
If you had a 5 bed house , I’d say yes downsize. But not a 3 bed . We all want to help our dc, but as we get older , we need to think of ourselves.