Moneymakeover How Should I Invest an Upcoming Inheritance

Steven Barrett said:
That is down to the parent and the child. There is only so much you can do as a parent. If you tell them they need to save some of their salary and be prudent with spending but they spend anyway, there is little you can do. They'll have to learn the hard way.
Click to expand...
This is a key point to me. I think we'll discuss with our kids that they take out an investment plan with a life company and tell them we'll be putting some monies into it from time to time over the next 10 years or so and we'd like them to use it towards a deposit on a house. They'll likely put it into the back of their minds, but if they surrender it to spend without thought, or don't save any of their earnings as a result, that'll be their choice. And we'll certainly be telling them it's a bad choice.
 
Last edited:
GSheehy said:
The reason I asked about these was just to get you thinking about their composition. Highly likely that there's circa 40% equities in the cautions fund and 60% in the managed ones, and you're thinking of reducing those. But, you're willing to consider 100% for the investment. If 40% was a compromise, I can't see 100% being a runner.
Click to expand...
Re my wife's €580k pension funds, since the above post she's looked at the latest position on these - see below. I haven't been involved much in this over the years - she took advice from her accountant/broker on the investment approach and I'm no longer feeling the need to be cautious with the fund types - am learning the lesson to think of them as long term investments. Some of the previous posts here have got us thinking though. If she was to retire at 60, to fund the 6 year gap until her state pension kicks in, should we plan to use some funds from the inheritance we'll be getting or else draw down extra from her pension funds? i.e. taking tax free lump sums (4 separate pension pots) and/or extra drawdown for the 6 years. She would also welcome any advice on the pension funds she's in at the minute.

WhatsApp Image 2025-10-15.webp
 
Seems like unnecessary fragmentation and potentially overlap to me to be honest. But then again I'm a 100% equities, ideally low charges index tracker (e.g. MSCI World Index), kind of guy myself. Even in my late 50s and starting to draw a small amount annually from my pension. But I also have other non pension assets to fall back on if necessary.
 
JamieB_ said:
But it is given. Dont know how revenue could argue that putting it in the kids bank accounts means anything other than a gift.
Click to expand...
If you put money into someone's account to mind for you, that is not a gift.

In your post suggesting this, you said:
JamieB_ said:
Key kids. I want you to mind 3k per month for me in broker accounts in your names . . i will lodge 3k in every month. You are not to touch it. I will take care of any tax etc . . .
Click to expand...
[Nitpick: You mean 3k per year, of course.]

That's absolutely not a gift. Not even close. Every element of what you said underlines that it's not a gift.

If you had said instead "Here's 3k. It's yours to do with as you wish, though I recommend you to invest it and not spend it for now", that would be a gift.

JamieB_ said:
I think i'll take my chances with revenue on this one
Click to expand...
If you and your kids are willing to collude to tell Revenue the same lie, this tax evasion may succeed. But it absolutely is tax evasion.
 
Last edited:
TomEdison said:
If you and your kids are willing to collude to tell Revenue the same lie, this tax evasion may succeed.
Click to expand...
There’s no collusion proposed here. Surely the whole idea is that the kids remain ignorant of the OP’s true intent, in which case they haven’t colluded in anything. The OP would have acted in isolation.

On the other hand, if the kids are aware that the money is really a gift, then where exactly is the tax evasion?
 
Assume that JamieB's objective is to avoid a CAT liability which would otherwise arise.

It's the kids, remember, who have any CAT liablity that arises. It's also the kids who have reporting obligations in relation to the gifts they receive. So, if JamieB puts 3k/year into their accounts for 10 years, telling them "you're to mind this money for me; don't touch it" and then after (say) 10 years, when there's 30k+ in each account, tells them "right, this is all yours now", it's the kids' responsibility to comply with the obligations resulting from receiving that gift.

In other words, JamieB's annual 3k instalments are useless for tax evasion purposes unless JamieB also intends to encourage the kids to treat the payment of the instalments as a pretext for pretending that they received 10 annual gifts of 3k each. If the kids aren't in on this, the scam doesn't work.
 
Mettmo said:
Some of the previous posts here have got us thinking though. If she was to retire at 60, to fund the 6 year gap until her state pension kicks in, should we plan to use some funds from the inheritance we'll be getting or else draw down extra from her pension funds? i.e. taking tax free lump sums (4 separate pension pots) and/or extra drawdown for the 6 years. She would also welcome any advice on the pension funds she's in at the minute.
Click to expand...

I think you're on the right track here. If it was me, I'd probably use the full inheritance to fund any gap and kick out the drawdown age of the pension as far as I could and decide now that my (gross roll-up) investment risk strategy for pre and post retirement fund/s is going to be broadly similar given the time period involved.

The funds are all over the place. As there are just two provider options I'd look for 1 or 2 funds from the full current list available from each provider armed with the new knowledge you both have on risk and term. I don't do very much execution only business with either of those two companies but I only see one fund on the list that those savvy clients choose themselves.


Gerard

www.prsa.ie
 
In other words, JamieB's annual 3k instalments are useless for tax evasion purposes unless JamieB also intends to encourage the kids to treat the payment of the instalments as a pretext for pretending that they received 10 annual gifts of 3k each. If the kids aren't in on this, the scam doesn't work.
Click to expand...

Despite all the finger wagging on here its not a scam and of course it will work. Revenue are not going to challenge you on it at all. It is a gift whether the children know its a gift or not.

One year I asked my brother to mind a new bike for me that Id bought for my other brother for Christmas. I phoned him Christmas day as we were on holidays for Christmas and I said, go out to the Shed and get your present, thats actually your bike. Next you'll be telling me thats a scam and big bad revenue will be on to me for it.

Anyway, I can see that ive upset some people who wany to believe there is some scam or collusion to defraud revenue going on here, when its just a little deception for the kids, so as not to tip the kids off that they are getting a gift before you are ready to tell them its a gift (though im sure they will suspect, but will not take any chances spending it in case its not), so no more on it as I think its derailing the thread. So i'll leave it there. I am 100% sure revenue are going to be knocking on anyones door over it.
 
Mettmo said:
Some of the previous posts here have got us thinking though. If she was to retire at 60, to fund the 6 year gap until her state pension kicks in, should we plan to use some funds from the inheritance we'll be getting or else draw down extra from her pension funds? i.e. taking tax free lump sums (4 separate pension pots) and/or extra drawdown for the 6 years.
Click to expand...

With 52k in pension income already, have you considered what your funding gap actually is?
 
TomEdison said:
it's the kids' responsibility to comply with the obligations resulting from receiving that gift.
Click to expand...
But, assuming the 3k limit hasn’t been breached, there are no obligations.
TomEdison said:
In other words, JamieB's annual 3k instalments are useless for tax evasion purposes unless JamieB also intends to encourage the kids to treat the payment of the instalments as a pretext for pretending that they received 10 annual gifts of 3k each. If the kids aren't in on this, the scam doesn't work.
Click to expand...
So you mean tell the kids that they’re really “minding” the 3k for the OP but if anyone asks, say it’s a gift?

I think they’d need to be quite dim not to realise that the money was really theirs.
 
JamieB_ said:
One year I asked my brother to mind a new bike for me that Id bought for my other brother for Christmas. I phoned him Christmas day as we were on holidays for Christmas and I said, go out to the Shed and get your present, thats actually your bike. Next you'll be telling me thats a scam and big bad revenue will be on to me for it.
Click to expand...
Wasting chattels/assets such as a bike aren't subject to the sort of taxes being discussed in this thread.
 
Salvadore said:
So you mean tell the kids that they’re really “minding” the 3k for the OP but if anyone asks, say it’s a gift?

I think they’d need to be quite dim not to realise that the money was really theirs.
Click to expand...
As I understand it, Jamie's intention is to deposit 3k into each kid's account each years, telling them that they are to mind the money for him and not to touch it, and that if there are any tax consequences or liabilities he, Jamie, will bear them (which is of course consistent with the money being Jamie's, and not the kids).

Remember, the only reason that Jamie says this to them is because he doesn't want them to have the money — he doesn't trust them to deal wisely with it; he doesn't think they should have control of that kind of money, and responsiblity for deciding what to do with it, until they have a bit of sense. So the money isn't "really theirs" at all. If Jamie wanted it to be really theirs, he would just give it to them. The restrictions he's imposing on the money are intended to be real, not fictional. If there's a fictional element to this, it's putting the money in their accounts, to create the illusion that he's giving it to them, when in truth he's doing nothing of the kind.

The kids won't think, at the time each 3k is given, that the money is "really theirs", because it's really not theirs. Jamie has been explicit; they're not to touch it. It's Jamie's money; they're to mind it for Jamie. At most, they might hope that some day it will be theirs — that Jamie will tell them they can have it.

So, the day finally comes when their dreams come true and Jamie, in his wisdom, decides to give them the money. So he says "this is all yours now". That's when the gift is made. It's a one-off gift. And it's for considerably more than 3k.

(There may still be no tax liability. They're Jamie's kids, and they can each get up to 400k from him without incurring any CAT liability. But the entire charade is completely pointless unless Jamie thinks there is, or is likely to be, an actual CAT liability on the aggregate amounts he expects to pass to his children, so I'm discussing it on that basis.)
 
Last edited:
JamieB_ said:
One year I asked my brother to mind a new bike for me that Id bought for my other brother for Christmas. I phoned him Christmas day as we were on holidays for Christmas and I said, go out to the Shed and get your present, thats actually your bike. Next you'll be telling me thats a scam and big bad revenue will be on to me for it.
Click to expand...
No, but we are telling you that you gave him the present on Christmas day.
 
Salvadore said:
So you mean tell the kids that they’re really “minding” the 3k for the OP but if anyone asks, say it’s a gift?

I think they’d need to be quite dim not to realise that the money was really theirs.
Click to expand...
Exactly. All your doing is making them think hard about spending it as they arent sure yet, even though you are. Anyone asks you in future - "Of course it was a gift. Why do you think I put it into their accounts?"
 
JamieB_ said:
"Of course it was a gift. Why do you think I put it into their accounts?"
Click to expand...
"If it was a gift, why did you tell them not to touch it, to mind it for you, and that you would be responsible for any taxes? And why did you tell them, years later, that they could now spend it? Do you normally go around dictating to other people what they can and can't do with their own money?"
 
When will you consider that they can be trusted with the money? Will it be only when they buy a property or will a lifetime dream/project do? This scenario reminds me of my children and my parents. My parents opened accounts for my children when they were young for "when they are older". They put money into them from time to time (nothing much) for birthdays or occasions. But they kept the documentation on these accounts and still do despite the fact that one of my child is an adult now. When my children were younger, all was fine. However, one of them is a student and somewhat would "need" the money (at least he thinks he could get good use of it)! It's only a few hundred euros. However, the gift is somewhat still in their hands!
 
You must log in or register to reply here.
Back
Top