Important, I get this wrong, no sporty car for me ever!

[DonkeyApple]

In short, if you accommodate your in-laws on your property in any way then your wife will have a permanently altered relationship with her siblings. This seems rather clear as the relationship has already changed and no money has even changed hands. The siblings are all squabbling over an advance receipt of their parents' wealth at the outset!!! You cannot win and you will not win.

Do not mix your property extension with your in-laws inheritance. All you will achieve is a loss of siblings, a distressed wife, a millstone of in-laws and you'll almost certainly be out of pocket and not driving the elusive sports car. And your wife will be doing all the palliative care.

If the in-laws wish to downsize and gift some of the equity released by doing so then that is something for your wife and her siblings to help them with. They can all help find their parents the right home to move to where they can all help look after them in their old age.

At the same time and wholly separately, you, as the outsider and heartless bd that you are should complete this outhouse and rent it out for income for you and your wife. No one else. Your home belongs to you and your wife, it is your granny flat, you build it and you rent it out for extra income for you, your wife and your children and when your children are old enough to pay rent and want to move out then you can offer them a small discount if they want to live there.

Do not condemn your wife to a broken relationship with her siblings and do not condemn her and yourself to 24/7 palliative care for her parents as her siblings will not be helping you. They will have spent the money they will have been given and sniping at you and your wife for being thieving, greedy bds and robbing their beloved parents that they never gave a st about caring for.

Build the granny flat, rent it out on the open market and have a happy wife and a sports car, or let your in-laws live in it and be miserable.

[schmokin1]

X jay- the property was bought on the understanding that the oldies would contribute to the cost of putting them up. If we had faffed about doing months of family arguments someone else would have bought it, so I did before any arrangements had been finalised (it is the inlaws money after all). It just so happens, that according to my man maths the costs of carrying extra mortgage(as opposed to buying the equivalent property but without an annex building) for the period the inlaws are expected to be in there will be equivalent to the conversion costs. We could borrow the cash, do the conversion, but the net effect would be interest money going out of the family. If they pay us an appropriate lump up front, we don't need finance, we can charge them less, hopefully leaving more for all the siblings at the final reckoning or for the oldies to spank on cruises....

IsaacH so all siblings get equal cash, but we are the only ones to have to accommodate the oldies for 20 years? The others can buy an investment flat and rent it out, we get no rent and can't live in the property in the meantime, as Walm highlighted earlier in the thread.....

Edited by schmokin1 on Tuesday 23 February 19:40

[schmokin1]

Donkey apple- interesting post. The oldies do actually want to do this. The sibling that is kicking off about it lives abroad. We will end up with doing the lions share of looking after them anyway....

[ClaphamGT3]

walm said:

ClaphamGT3 said:

Not in the slightest - what possible business of mine would how my father spent his money be?

Do I really have to spell it out?

Perhaps your father had always intended to split everything equally between you and your brother but (like the OP) was putting money into the property up front in order to cover 20 years rent.
But with the unexpected death and no adjustment to his will your brother has just trousered potentially six figures that your father would have intended to go to you.

I have no idea (and little interest) of how my father intends to distribute his wealth on death. He may leave it to my three siblings and I in any proportion he chooses or he may leave it to none of us. It is his money to do with as he chooses. As it happens, I suspect that he will leave the very large bulk of his wealth to my eldest brother with small items of intensely sentimental value left to my other two brothers and I. What possible right (moral or legal) would I have to question the choice he makes?

[DonkeyApple]

schmokin1 said:

Donkey apple- interesting post. The oldies do actually want to do this. The sibling that is kicking off about it lives abroad. We will end up with doing the lions share of looking after them anyway....

The trouble with oldies as they want to be helpful and logical and equal. The problem with siblings is that this isn't ever possible. One sibling will always benefit more than the other(s), whether that is in doing less caring or getting more child support or more money etc. If the siblings have already announced that they cannot accept this very basic fact of life then you need to consider 100% your direct family and not your wife's remote family.

If the granny flat is a separate property then at best you should sell it to your in-laws at the market rate determined by valuations instructed by each sibling, signed and agreed by them. In-laws can then hand out their released wealth in even parts after and wholly unrelated to the property. It then becomes a very simple trade that in the early years you and your wife benefit from free childcare and in the later years you pay that back with free palliative care. When they die the property is sold and split equally between the siblings. Just add to the contract that you have first refusal on the property at the market rate determined by 3 estate agents, one chosen by each of the siblings.

[walm]

ClaphamGT3 said:

I have no idea (and little interest) of how my father intends to distribute his wealth on death.

You continue to miss the point (deliberately? - I know you are a smart guy!) by making posts which can be summarised as "getting a six figure sum for free or not doesn't bother me".
I strongly suspect your brother has a very different financial situation, no?

I 100% agree that my parents' cash is theirs to blow on hookers and coke. And I truly hope that they do!
But I know they want anything left over split evenly.
If through some accident my sister ends up pocketing many thousands that my parents clearly intended to be shared with her, my brother and me - I am going to be pissed off!!

If she were on the poverty line and I was super well off and she said, "look I know M&D just died in a coke-fuelled Vegas binge, but I could really do with the cash and the house is still in my name anyway" then I would certainly try to help her out.
But just taking it, isn't on.

[ClaphamGT3]

As far as I'm aware, my eldest brother is significantly wealthier than me though, to be frank, We never discuss personal finances (and are deeply irritated by our one brother who seems to think that doing so is acceptable).

I think that we will have to agree to differ as I just cannot see what bearing how and where the OPs in-laws spend their money is any business of any of their children. This isn't France and there is no obligation to distribute wealth 'fairly'

[xjay1337]

schmokin1 said:

X jay- the property was bought on the understanding that the oldies would contribute to the cost of putting them up. If we had faffed about doing months of family arguments someone else would have bought it, so I did before any arrangements had been finalised (it is the inlaws money after all). It just so happens, that according to my man maths the costs of carrying extra mortgage(as opposed to buying the equivalent property but without an annex building) for the period the inlaws are expected to be in there will be equivalent to the conversion costs. We could borrow the cash, do the conversion, but the net effect would be interest money going out of the family. If they pay us an appropriate lump up front, we don't need finance, we can charge them less, hopefully leaving more for all the siblings at the final reckoning or for the oldies to spank on cruises....

Edited by schmokin1 on Tuesday 23 February 19:40

So your already got 1 foot im the grave so to speak.

Abort abort abort.

I read above about selling the granny annexe. If you are not prepared to rent it out privately (and you would have more money in the long term) then sell the Annexe at market value to the in laws.

I would really not get involved at all with this.
Donkeys advice is good also. It is quite similar to mine so of course it is good. :-)

Thats my view.

[thepeoplespal]

Selling the annex is a load of nonsense from what the OP described, so why dwell on it. Don't know if it's possible, but the oldies need a clause in their will, that if any sibling disputes it in court, that they would invoke a clause to remove their inheritance entirely, bar a nominal sum. :-). That would concentrate the mind a bit.

Oldies need to be firm with other siblings if this is to ever get off the ground and not lead to family feuding. Getting a secure future home is not cost free and the siblings need to understand this, again give them a chance to put their money where their mouths are and take the risk on themselves, as it should stop them moaning. "You were given the opportunity and you didn't take it"

[Ilovejapcrap]

I feel for you OP but this whole subject just shows what's wrong with people today.

My mum and dad talk about how if I loose my dad my mum may live with my sister.

She will spend some mone to convert an outbuilding to granny flat. At no point have myself or brother thought oh my sister is getting more than us in long run.

What we have thought is great mum will never be alone.

What a sad world we live in.

I'd ask one of the other siblings to have them.

[walm]

ClaphamGT3 said:

I think that we will have to agree to differ as I just cannot see what bearing how and where the OPs in-laws spend their money is any business of any of their children. This isn't France and there is no obligation to distribute wealth 'fairly'

Don't get me started on France!! (MiL lives there and I just KNOW it will cause problems ahead...)

The only reason we are disagreeing is that you think where they actually SPEND their money is exactly equivalent to where they INTEND to spend their money.

One last analogy (promise!) - say your parents pay a HUGE up front payment to a random landlord to cover rent for 20 years.
Then they get hit by a bus or something the very next day.

The landlord keeps the money and then rents out their place to someone else for the next 20 years too.

Surely you would agree that the landlord has not used the money as your parents INTENDED?
They actually wanted 100% of anything left to go to the RNLI. You know this... everyone knows this...
That "unused rent" should be part of their estate and going to the RNLI - not a random landlord.

That is the simple principle at stake here.

Edited by walm on Wednesday 24th February 09:07

[schmokin1]

Isaac
If it was a couple of years, no problem, I would suck it up. However, funding both the conversion of the building and the extra mortgage is totally unaffordable over what could be decades. I'm not going to have my kids living in penury to keep the inlaws in fine style when they can pay the costs from their house sale profit and still leave substantial sums to the siblings if that's what they want.
Walm's point will be covered by an agreement to repay what we gain in the short term if the olds die or move out shortly after moving in. We would rent out the annex in that case.

Cheers all

[rb5er]

Hate to break it to you but if they are in their 80's they are unlikely to have another 20 years left in them and even if they do then not likely to be copus mentus for all of that.

I think as others have said you need to build it yourselves and then charge market rent or similar or you will end up in court and a nasty situation in a few years.

[walm]

schmokin1 said:

However, funding both the conversion of the building and the extra mortgage is totally unaffordable over what could be decades.

Doesn't charging them rent solve all that?
Seriously - this isn't profiteering any more than having them pay for the conversion.
It's the exact same thing.

[AndStilliRise]

Perhaps it is me, but these kind of posts really do sadden me. A couple of points if i may (this applies to everyone talking about inheritance):

1) Talking about inheritance is bad form. Surly the most valuable asset is that your parents/elders are around for all of us.

2) Are you really bothered what gets left to you?

3) If you are counting on the financial gain from your parents/elders then you truly did not put into life as much as your parents.

4) Why don't you try making it on your own without a view as to what you are entitled to?

5) I believe i deserve a Ferrari, my bank account disagrees so i don't have one. Believing your entitled to something and earning it are two different things - a man would always earn his way in the world.



Kind regards.

[xjay1337]

So what is OP actually doing with regards to the decision now?

[walm]

AndStilliRise said:

1) Talking about inheritance is bad form. Surly the most valuable asset is that your parents/elders are around for all of us.

2) Are you really bothered what gets left to you?

3) If you are counting on the financial gain from your parents/elders then you truly did not put into life as much as your parents.

I somewhat disagree. I know it is distasteful… but…
Honouring the wishes of dead people matters to me.
People die, it’s a fact of life.
Just ignoring wills and inheritance (putting your head in the sand) until it is too late leads to more problems than having an adult conversation about it before the inevitable.

And in particular suggesting that people have put “less” into life than their parents is ignoring the incredibly different economic situation our parents faced compared to today.

There is simply no denying that our parents had an incredibly good run much of it through good fortune rather than effort on their part.

e.g.
- Gold plated DB pensions.
- Free uni with grants.
- Incredible house price inflation, effectively creating another pension asset.
- The swinging sixties.

I don't want to go into specifics but through very hard work my Dad managed to give his three kids a truly fantastic (given where he started) middle-class upbringing.
On paper I have "achieved" just as much as him,
BUT there is simply no way I am going to be able to give my kids the same. Close perhaps but not as good.

In fact, it is worse.
If I had chosen the EXACT SAME career as he did (which was a distinct possibility for a time) and again achieved just as much, I would be EVEN WORSE off than I am now.

Just google "best off generation" and you will find plenty of evidence to show that people born post 1970 will be part of the VERY FIRST generation who will be materially worse off than the previous generation.

[iphonedyou]

schmokin1 said:

So the background info you PH genii need....

I've rubbed my lamp, but nothing so far. Sorry!

[schmokin1]

Again interesting posts guys.

As I see it, I have an absolute responsibility to my kids to give them a decent upbringing, with as many nice experiences as I can. Part of that will involve foreign holidays etc and the chance to watch Daddy sprinting or hill climbing a car at some point That will cost money.

I have an option to accommodate the outlaws too, but as they can well afford to pay a fair contribution I don't see why my kids, or indeed self and the boss should carry a financial burden to do it. Hence, having talked it over with SWMBO, we are going to stick to our guns, we think, and offer the annex on a cost neutral to us basis. If that ends up a borrow more, do it up and rent it back to them structure then so be it.

I do actually want this to happen as they are both fit, not in their eighties yet, and MIL in particular is heavily involved with the kids (by choice not coercion!).

I disagree talking about inheritance in advance is poor form. Better I think to plan ahead, get the oldies looked after, at the same time reducing the chance of a care home being needed for one or both. Money gives you options and opportunities for this stuff.

Btw , genii means several genies or geniuses

[superlightr]

General advice is to fund the cost and then rent it to them. I would agree with that. My parent (s) lives in her own house not far away. She is looking to downsize again. Much better to have them close by but in their own property.

What I havnt seen mentioned - What if you want/need to sell up and move to another house? or you and wife divorce, or need it to fund whatever? You may be stuck as you have the oldies in the annex.