Son looking for money.

Lots of sensible advice here but this might be of general interest. Have just redone our wills as we’ve given DD1 a large sum of money towards a house purchase, so are leaving DD2 a larger share of our estate. There is a new allowance called Main Residence Band and it’s £175k added to the £350k allowance - meaning we each have £500k before IHT would be applied. When the first party (married only) dies their £350k personal IHT allowance passes to the remaining party - which would mean an estate of £850k before any IHT would be payable, after the death of the remaining person. X

Sorry this site should allow to edit but I can't find how. So my post per cent she means 3 -4 years = 32% 4-5 =24% and so on.

www.gov.uk/inheritance-tax/gifts

People you give gifts to will be charged Inheritance Tax if you give away more than £325,000 in the 7 years before your death.

The 7 year rule
If there’s Inheritance Tax to pay, it’s charged at 40% on gifts given in the 3 years before you die.

Gifts made 3 to 7 years before your death are taxed on a sliding scale known as ‘taper relief’.

Years between gift and deathTax paid
less than 340%
3 to 432%
4 to 524%
5 to 616%
6 to 78%
7 or more0%

Excellent advice from CarlyD7 Thu 16-Jul-20 10:30:07 and
icanhandthemback Thu 16-Jul-20 11:09:51

There is so much to consider. It's not all plain sailing.

I've watched television programmes where renters have had been devastated with tenants not paying the rent for months on end and had to go to court numerous times to try to evict the tenants then to find the property ruined inside. All this costs money. Plus the mortgage still needs paying.

It's not all bad I know and not all tenants are bad but as the posters I've mentioned have said, the landlord is responsible for paying tax tax on the rent, the upkeep of the property, insurances for the property. yearly gas appliance service, etc, etc.

It's worth reading the Tenant's Right's as I think that was updated last year and gives tenants more rights.

There's far more to this than just handing over money and that's the end of it.

I have knowledge of renting as a relative of mine is a landlord.
If it was me, I would give no as my answer. Tell him he can do whatever he likes with his inheritance when you're gone.
There's nothing to feel guilty about. you've got to think of you.

He shouldn’t be helping you with your finances, then asking you for money. What will be next?

Just explain why you are saying no .whats wrong with asking for a loan from the bank .or you could loan it to him providing you get this in writing legally .so that he csn pay you back.i take it your son is working ..other than that say NO

It seems regardless of sound advice being given here you have already made up your mind to lend to him. I received very good advice from a family solicitor some few years ago. "Remember you have to live and any thing left there after a bonus". Your son obviously believes you have more than you need which is quite outrageous. Stick to your guns and tell him you cannot and will not risk your financial security. But whatever remains thereafter will take into account the level of financial support already given to your other son. It will not appease him but have you thought by lending to him you might end up in the same precarious financial position as him. Like others, I am at a loss to understand, why you have allowed someone, son or not, unable to look after their own financial affairs to be dealing with yours! Don't do it!

I'm not clear if he just wants enough for a deposit or if he expects to have the entire purchase cost?!! (No need to answer). Either way he will need some capital of his own for the on going costs or will he expect bank of mum to bail him out if he has a void period or large bill. This doesnt sojnd great if he is not good with money

Also I'm wondering why he helps look after your money? That's something I would change!!

And while you are clearly a caring mum to worry about his future, maybe considering YOUR future should be priority.

As others have pointed out antheacarol55, it does NOT help when you come to pension age to just 'have no savings' you have to prove where its gone to- and if you've just 'given it away' it causes its own problems....

Don't do it, you said you have no works pension so rely solely on the state pension. That's not enough to live on.
Secondly, rental properties are not a cash cow as many believe. I let out a property that belongs to my son while he is away and the income isn't great. We had one tenant who trashed the place and had to redecorate, get rid of all the furniture and replace all the carpets. It's now let unfurnished to a great tenant but we're still trying to recover our losses.
Frankly even though I like the current tenant, every time my phone rings and it's the letting agent my heart sinks. It takes a while to recover your peace of mind. I'll honestly be glad when he comes home next year and moves back into his flat and I can relax again.
Just tell your son he'll have to wait for his inheritance because while you are alive it's your money and you need it.

Personally I would take proper legal advice as to how this will affect you in future ...i.e. should you need full time care in a care home ...if you need this within a period after you have given away the money I believe it can be recouperated as it will be seen as deliberately giving it away to avoid paying care home fees. (check up to date details with CAB) ....otherwise, if you can afford it, and still own your own home with a bit left over, and you feel this is something you WANT to do then go for it .....perhaps you could set up a company to process the payment received for rent, with a portion going to you ....but again, check this out with a lawyer who specialises in property .....either way you need to protect your investment. Or you could simply give the same amount to this son as you did to the other .....I had a friend who helped one son buy an expensive house in London, and he promised to convert his double garage into a granny annexe ...got planning permission, etc ...she gave him a considerable sum of money .............long story short, she now lives in a residential mobile home as he reneged on his promise. Her second son also had money to buy a flat .....so think very carefully

There is another thought, not sure if already mentioned
but who knows what is going to happen in the property market now? easy to say will always go up,, but then it can go down ...

not the best thing to do in the present climate imo.

We’ve always taken the stance that all our children are treated fairly according to their needs. This hasn’t necessarily meant treating them all the same...because they’re not all the same. So if we gave one £100, we wouldn’t give them all £100, unless they needed it at the same time. When it came to other people, so grandparents for example, they would get the same from them to the point it was often a chore to find presents of equal value, that they actually would like! If you can afford to help your son, and you want to...then go for it. You are under no obligation whatsoever.

I’m afraid I don’t agree with all those who say give each AC exactly the same. It’s a sad fact of parenthood that we have to acknowledge that different children have different abilities with or attitudes to money. Giving to one who needs a little help but is doing well themselves is positive help. Giving to another because they are making a bags of things and are not financially savvy is just enabling them to continue being irresponsible. I speak from experience. I find that in general those who demand or pester, are the ones who will treat your hard earned cash with least respect and certainly never pay it back. Those who will use it wisely rarely ask.

It is your money and your choice as to what you do with it. I personally try to treat my grown up children the same. I gave my daughter some money when they bought a house, one son the same amount when he got married, they put it towards the deposit on their house. The other son knows he will be given the same, either when he marries or buys a house, whichever comes first

Think very carefully before you get involved in anything that is to do with letting houses. There are many rules and regulations now and if you don't comply with them or are late doing something, you can lose the right to evict a troublesome tenant. If you are part owner, you can be ordered to do maintenance within 28 days by the Council which you might not be able to afford. It is not an easy path to a return on an investment.

First, talk openly with a financial adviser about your future needs and ask him to help you draw up a financial plan, taking into account the possible need for care home fees etc. See if there is sufficient flexibility for you to give your son this money
Second, take your plan to your son and show him the numbers. If you have sufficient flexibility to give him money then tell him how much it is and that there can be no more. Make sure the amount you give balances the amount you gave to your other son - but no more. That way you have been even handed.If the answer is no then it is no.
Thirdly talk with his brother about what you are doing so that he is clear that he and his brother have been treated alike.
If adult children assume (why on earth should they!) that they are owed money when required then they must at least behave like adults and acknowledge that financial management isn't a magic formula but a series of careful calculations.
If you don't have a very clear structure then it's all too easy for the situation to become a slow bleed.
Good luck!

Loaned my brother money when he was in dire straits following his divorve.Interest and overdraft charges were enormous so tried to get him back on track.
Both him and his ex wife had been asking my mother for money for years,washing machine broken,she bought a new one,school trip for his children ,holidays etc .
Found out my father had been giving him money every month.
He now has a good job,got a large mortgage for refurbishment of his new house,with new girlfriend.
only a small amount repaid to myself and none to my mother.
My sister and myself have had money diffeculty at times ,but worked hard to overcome these.I would and have loaned children money especially to help them at diffecult times.They have returned it asap.

You said it yourself 'I feel I can't refuse but worry about the future'. You need to tell him that, and talk it over.

Not a good time to buy anything so be careful. Can you afford it, can you still manage in your later years.

Ive got a daughter who constantly drains me of money . She has 5 children and uses emotional blackmail to get money, always with the promise of repaying . She wastes money , wants new things all the time etc but knows that I go without . ( and sniggers about it)
Ive balanced things up financially with my younger daughter to avoid unfairness on my death .
Recently she's somehow accessed my bank account and bought rubbish on Amazon , I only found out when my bank account arrived . With the bank's help everything was closed down . I can hardly look at her , she ridicules me all the time , belittling me , she's a bully , I think . A Nick Cotton ! The other day I hid when I heard her car ( paid for with my hard earned cash ) .
I've turned cold emotionally and at the moment do not want to have contact .
So , Kirkcubbin I would maybe advise you to even up your sons then no more loans for either . When you hit a financial problem yourself , who will help you - no-one .

How many children do you have? Can you afford to treat each child equally whether they are in need or not?
If it’s an investment and not for him to live in then don’t do it unless you can do it for all your children.

Take some proper financial advice on your own needs to cover your immediate needs to a reasonable standard of living, allowing for nice holidays etc, and allowing for any possible care costs in foreseeable future. If you have spare cash, then
you could consider whether the same value gift as given your other son can be made, otherwise your other son may expect you to facilate a buy to let investment for him as well.

Buy to lets are no longer the sound investment they used to be, but do potentially provide capital growth and income. Avoid leasehold buy to let where there is a large service charge to pay out of rental income, and avoid properties needed repairs and maintenance. Tenants like modern energy efficient properties. Remember that tenants do not always pay rent especially if they lose their jobs. It is now unlawful to refuse benefits claimants as tenants, after yesterday's court ruling, and Universal credit may not cover all the rent .
If you can not afford to give money away now, your son(s) may simply have to wait until you die, when they will receive whatever you leave behind. Make a will if you want the the value of any previous gifts to be taken into account on distribution of your estate.

Refuse. Your future is priority,,,and you never know how much you’ll need or when you need it. It is your money, if there’s any left then it might be his when you’re gone but not until. An investment is not a necessity. It may well simply be about trying to be receiving the same as his brother from you, sibling rivalry, totally understandable but coming from a child rather than an adult position. Reassure him that you live him just as you do his brother and that money and help has nothing to do with it.

Kircubbin give the same to this son as you gave to the other, if you can afford it. If not, explain why and keep your finances private.
I helped my younger son when he was buying his first house and I have the same amount set aside for the other, some of which I have given to him. He knows the remainder is there should he need it. Both sons were given housewarming gifts of the same amount and they both have the same spent on them for gifts.
Much as we want to help our children sometimes we have to let them become financially independent as adults and think of ourselves.