Can I ask for some ideas please?
I would like to hear from you different ideas on how to help my own daughter, (married with kids) to have her own house.My son in law works as a casual teacher, hopefully soon to be full time. They have 3 little kids to look after and she has no plans to work. We live in Sydney and so far she has been renting from some friend who went to England with a contract and left the house for them on a really low rent. Yet this will not last forever.
The more I think about it the less I find a feasible solution.
I thought about buying a house in Campbelltown for some 300 – 350k half with them. I can pay half the mortgage they can pay the other half.
Only this will not go down very well with my other daughters, since one of them has 3 houses in Sydney and another one in Cairns, purchased in the last 4 years and my other daughter still at home bought also her IP last year. None had free rides from me.
I think that the most they could pay a week is 300 and that is stretching it, Can you think of anything that resembles remotely a business solution that is not a hand out?
May God prosper you always.[biggrin]
MarcHi
please forgive my eagerness to express my oppinion, but what went wrong with this partiular daughter that the others all have their own IPs and she doesn’t?
I ask because I just finished reading “the Richest man in Babylon” and it spoke of a spear maker that received 50 gold coins from the King – a gift. His sister, too wanted to borrow the money in order to make her husband a merchant. The advice given then is If the husband knows nothing of being a Merchant (where/when/what to buy how will he ever repay the loan) – that is, if he doesn’t know what he is doing then how can he be a good steward of the money.
What has that got to do with the price of eggs? Your daughter is the merchants husband and, as all your other duaghters have managed to buy IPs, with, I gather none of your help, aybe it would be better that you educate her and ffer them a busines solution with a written contract! She maynot like it at first (hell, I din’t when my dad did it to me) but she will either learn to be as investment savvy (or selfsufficient) as the rest of your daughters.
The uside too is that your grand children will then learn it from their parents, so your helping the whole family not just your daughter.Have I overstepped the mark? Sorry, family is atough subject. Remember to invest without emotions try with family). A business solution will not be seen as a hand-out by the others, maybe a leg up. Think of it as a flip/wrap at bargain basement price! Yuor help would be to absorb some of the costs.
Hope this helps make up your mind, one way or the other.
CheersC@34
Hi Marc1,
I am particularly fond of a saying my aunt used remind us of whenever we (my sister and I) would whinge about our children, that goes something like “just as the fingers on your hand are all different (in length), so to are your children”.
I would imagine your (struggling) daughter (and her family) have not managed to buy their own home, most likely because that is what they have been doing….struggling; especially if poor hubby only works casually.
Anyway, what I would do is buy the property (in my name) and put them into it, for whatever rent they can afford OR….maybe (and I don’t know much about the WRAP process) you might be able to buy it and sell it to her through the WRAP method (strictly business).
At the end of the day, neither of your two other daughters should feel threatend….just because they were more fortunate, doesn’t mean they should look their noses down at their battling sister, or you for trying to help out. Just reassure them, that they had the sense to make it, and she just needs a little “push” but that it will not be at their expense, and that she will be repaying any outlay….or better still…. it is really none of the business!!!!!
Hope, I too, haven’t overstepped the mark here with my comments.
Regards,
JO
Hei, no need to be so carefull, I asked didn’t I?
Calvin:
Nothying wrong with her, she just started a family stright after marriage and one income is not so flash. The other two girls, one is DINK and the other is still at home.You are spot on about them not beeing business orientated. I Offered to puchase an IP 1/4 each just to get them going but my son in law declined, so we purchased one 1/3 each with the other two that did not realy need any encouragment. They missed out on some 30,000 last year alone with that silly move.
I could just get them to buy and underwrite the mortgage, or draw up a wrap at no profit but they can not repay 350k, you need some 600 for that.
Monopoly:
Yes our kids are all different, ‘like the fingers on our hand’… I like that.
Even when my last daughter (12) seems a ‘twin’ of the eldest one (28)So you say to buy a house and just subsidese their rent. Mm, I suppose I can do that, but how does that help them to have their own house?
Wouldn’t that just perpetuate the dependency?
None of the sisters looks down to them, I just don’t want to do something that I cannot do for all.
I have been thinking about another possibility but it is a bit more in the future. I want to move to a farm in Camden, Cobbity or therabouts, and they could build their house on the farm next to ours, by taking out a smallish loan, yet that would make an even bigger mess, since such house would be un-sellable unless I buy it the day they want to move.
[glum]May God prosper you always.[biggrin]
MarcWell when he starts full time work the market wouldve cooled some more, so things will prob fall into place for them.
I never seen a teacher do it tuff
Marc1,
the second part of my suggestion, aside from the rent one, was the WRAP process that so many in here refer to (which, as I stated, I know next to nothing about). Fundamentally, I guess you buy the property and sell it to your daughter. At the end of the day, she is paying off her own home, but instead of to a bank, she is paying it off to you.
Just a suggestion, that’s all….
Jo
Bad suggestion Jo. Why incur two lots of stampduty if there are other ways ?
Marc, there is absolutely nothing wrong with you helping the daughter in need. The one needing some help could have been anyone of your daughters.
Inflation will eventually take care of their problem and at some stage you will be able to extricate your money.
Pisces
Marc,
I am not sure what “free rides” and “hand outs” have to do with parenthood. You are using terms that the government uses, and yet you are her father.
When my former gf and I were financing our second IP, we needed some extra dough to finance it- I think it was 10k at the time. She decided *not* to ask her uncle (her closest relative in Australia) to assist us, even though he was willing to, because she felt there would always be some sort of obligation there- some kind of attitude that he might have, because he had assisted us. She said she wanted to go with a bank because the banks would have no particular interest in our finances, whereas her uncle would have an interest in our new IP that she felt was uncomfortable for her.
In using the above example, I am only referring to your term of “handout” and “free ride”- they have negative connotations.
Why would your daughter’s siblings have any resentment towards their father for giving to one of his children? Why would they resent their own sister if she received some assistance from her father? I don’t see anything wrong with your daughter for not having made the decisions her siblings have made.
I guess this is one of theproblems of doing finances with families- all kinds of guilt and resentment can arise. I wponder would it be worth it for your daughter to receive your assistance if the consequences are all about expectation, and she receives resentment from others for doing so.
kay henry
Pisces,
I couldn’t agree more with you…..I stand (somewhat) corrected!!!! Ofcourse my suggestion was flawed in that there would be 2 x stamp duty if Marc were to use the WRAP system to buy the house and his daughter becomes the WRAPEE.
HOWEVER…..(now this is where my ignorance of this matter really shows) who says that he has to make her pay for the stamp duty???, maybe he can cover it, and then collect that from her in the repayments she makes thereafter.
As I said….I am not really sure about the complete picture when it comes to WRAPS, and maybe I was just flappin me gums[blush2][blush2], but it was the only “business-like” option I could see at the time, as any other (aside from renting to her, also covered) gave rise to Marc’s other daughters as viewing it a “hand-out”. Having said that, even the WRAP thingy will undoubtedly be viewed as such I guess [blink][blink]
Personally, I agree with you, whatever means Marc uses to help her out, is ultimately his business, and I don’t think his other daughters should be too bothered, I am sure he would do the same for ANY of them if the need arose.
Jo
They’re extremely lucky to have the friend rent them their place at a low rent. I wouldn’t want to imagine how things would be like for them if that wasn’t the case; 3 kids, one casual income.. in SYDNEY too. [blink]
Apart from the husband possibly getting full time work, is your daughter thinking of doing anything to help financially? Maybe work from home or something similar? Just from the basic info you’ve provided I’m thinking that they’d be struggling if she doesn’t.. imagine their friend decides to stop renting the place to them and wants to sell it.
Morning all,
just re-read the original post by Marc1 and noticed that you offered ALL your duaghters a 25% share in an earlier investment. She (or her hubby) turned you down then, would they turn you down now! Especially if you outlined what they missed out on. This way you are just repeating what you did earlier, even if you only offer it to the one daughter. Surely no misgivings could arise from the others for that?! She could then, at a later stage when hubby is fully employed, buy you out.
Just a further ‘correction’ on my first somewhat clinical post.[blush2]
See what you think
CheersC@34
Sounds like this daughter does not have a problem today she and her partner have been like this for years. Before you can help them they must help themselves, I’m sorry but I have friends in great hard ship and they are getting out of it by shere hard work and many part time jobs …
The worst thing you can give to poverty is money the greatest thing to give to poverty is education … you family has it (education) you can teach the TEACHER the question is though IS THE TEACHER WILLING TO LEARN???[grad]
This is called economic outpatient care – and it makes my blood BOIL!!!
Lets look at it from a purely financial aspect. You have 3 stocks. One has gone up 400% and has high growth prospects. Another has gone up 100% and has just as high growth prospects. One has fallen 25%, and has poor growth prospects, but it seems to have hard luck story though… It isn’t a hard decision though, is it.
It seems to me that you want to help your daughter, which is commendable. But I completely disagree with the way you are going about it for a number of reasons:
1) I’m guessing you want your daughters to be successful. The question is do you do that by providing aid to the least successful one???
2) You have not helped your other daughters out, even to buy an IP (to make more money). Yet you are helping another one out even though there not helping themselves out?
3) Your other children have scrimped and saved, and have delayed gratification (big time in the Syd. market!), but your daughter has not? So we reward those who go out and spend money, rather than saving?
4) Do they have a plan? Does the plan involve them getting financially wealthy?? If not why would you invest in their plan?
5) What are they doing to provide extra income? Does your son in law tutor? Does you daughter run any other (home based) business??I suggest you buy the book- “The Millionaire Next Door” for yourself (this provide statistical evidence that economic outpatient care does NOT work), and buy “Rich Dad, Poor Dad” and the “Cashflow Quadrant” for your Daughter. Don’t spend the money on economic outpatient care, but spend it on education, so they can learn to fish without you having to provide the fish!
Rgds.
Lucifer_auLucifer_au, that pretty much sums up what I was thinking but didn’t want to post.. I agree with you completely. What’s that saying about teaching a man to fish instead of giving him a fish? It goes something like: “Give a man a fish and he will eat for a day, show him how to fish and he will eat forever”. [blush2]
Marc1, it’s a difficult situation you’re in.. you probably need to sit down with your daughter and her husband and find out what their financial plan is ‘if they have one’. Having 3 kids would make things incredibly harder for them.. but I guess they would/should have planned for this..
Cheers, and goodluck!
I don’t understand all this business-talk, numbers adding up stuff where your own children are involved.
I completely agree with Pisces and Kay, what is wrong with helping your child?
If one of my brothers would need financial help from my mother, I’d be very happy if he got that help-there would not even be the slightest feeling of jealousy!
Where love is involved, it’s only natural to want to help your children, whether it would be emotional or financial, what does it matter? It’s only money!
Aww have a heart people!
How would you feel if you had financial difficulties, for whatever reason, and you knew your parents were able to help you but WOULDN’T?Ah what are you guys talking about. This isn’t business, this is someone’s child we are talking about.
O.K., in hindsight they made a foolish decision by, sometime ago, refusing an offer to help .
A parent is whatever they are. Giving, caring. Which parent wouldn’t want to dig one of their children out of a hole ?
If you guys want to play life with a knife on the table I am just glad you aren’t my parent.
My wife and I have given two children property. One lost it all because of her husband’s desperate ‘need’ to start a business he didn’t know anything about.
They dismissed a suggestion to obtain proper legal and business advice out of hand and paid dearly for their foolishness as they barely managed to retain their home (and, as a consequence, were saddled with a high mortgage again).
Would we give property away again knowing what we know now ?
Yes, of course because at the time we couldn’t possibly have known the eventual outcome.
Would we do it different this time ? Yes, we would put the property into a trust so any husband couldn’t ‘squander’ it to satisfy his own psychological need to prove himself.
Pisces
I agree with Pisces, Kay and Celivia… this is a parent talking about a child… it’s not a matter of black and white figures, and lucifer, believe it or not, some things are more important than the bottom line. I’m not sure why a parent trying to help out their kid is something that would make their blood boil [blink], but then again, you’ve mentioned rubbing your hands together waiting for “blood on the streets” to occur, so it’s pretty clear what angle you’re coming from. I’m not saying you’re wrong, just that your outlook is very different to mine, and the course I would consider if I had a daughter in a similar situation.
cheers
rMy view is a tad harsh and I’ll admit that, but I did say
“It seems to me that you want to help your daughter, which is commendable”There isn’t that much upside here, you tried to get her to invest with you in property that has gone up in value, she refuses, yet it could of given her enough for a deposit for her own house. You offered her an incredible opportunity, yet she decided not too, how would buying her a house help her? (what happens if she stops paying the mortgage??!!!). Also you don’t want to build resentment between your children. It can poison families. And thats the problem I see. Too much can go wrong, for not enough ‘upside’.
With my previouse example all I was doing was looking at it through purely business angle. And unfortantly thats the way I would do it. Say if my daughter wanted to start a fashion shop. I would have to say – “what do you know about retail?”, “what do you know about fashion that wil give you an advantage over others?”, “what is your plan (short and long term)?”, “have you worked a management position in retail or fashion?” (I would already know this though, so I wouldn’t really ask it). If she couldn’t answer those questions I would still probably lend her some small seed money (maybe $10-$20K), but I wouldn’t mortgage my houses for her.
I want the money to last over 3 generations, so I have to be more cautious, because it isn’t my money, it is the families money, and I have to do whats best not only for my children, but the next generation after them and hopefully the next generation after that….
Rgds.
Lucifer_auP.S. the reason it makes my blood boil is because I know of a father who constantly gives money to one of his daughters and she throws the money away (in fact without her father she would have to file for bankruptcy within one week! I am serious…), while her sister works hard, is going somewhere in life and yet gets very little from her father. That makes my blood boil. Also I promise to lay off the blood statements for a while (and no pices I’m not a vampire – I promise!! L0L).
My two cents worth ….
my parents gave me nothing (except the best possible upbringing they could give) and I really didnt expect anything financially from them, still dont.
I am also sure that if they had given me a headstart, without financial education as well, I would have more than likely lost the lot.
Now I am a parent myself and over the last couple of years been educating myself, financial wise, and have decided that I need to “educate” my son.
I will give him a headstart, by getting his name on one house. From there he can work and use his money to progress forward. But if he doesnt have the financial education to go with it, he will more than likely lose the lot.
Part of being a parent (my opinion) is to try and provide your kids with options and opportunities that you didnt have.
Everyone is different, some learn some dont, and everyone learns at different rates too.
Give them the opportunity, do what you feel is best for you and your children and if they let it slip then you have done all you can.
Marc,
I would be careful in helping out your daughter when you haven’t helped out your other two. Why you ask?Well, I moved out of home at 17 to attend university. My parents agreed to help me until I could find a part-time job by giving me $100 a week to pay rent and eat.
This lasted for the first year, in the second year I found a part-time job and no longer needed their money so told them to stop giving me any.
For the next 3 years, while I was studying full-time, I also held down a part-time job to fund my studies and my life.
During this whole time, my sister who decided not to go to uni (and is a year older than me) lived at home rent-free (my parents don’t believe in charging her rent, but always said they would charge me once I finished uni).
After uni, I met my now husband, we moved to Canberra together and tried to buy a house. We had money from a cash gift we received, enough to pay for the deposit and stamp duty. Little did we know that this did not count for our loan as we did not have “proven” savings. We immediately asked my parents for help knowing that we would be able to pay them back quickly (we only needed another 5% or around $5500 to avoid mortgage insurance) and we knew they had the money available.
As we hadn’t been together very long, they decided this would be a bad move, in case we had a “bad breakup”.
To this day I have resented them for this. They wouldn’t lend me a measley $5500 for a property which has nearly tripled in value since we would have bought it, but they are quite happy to have my sister live at home for 10 years since she finished high school absolutely rent free (she doesn’t even pay for groceries), but they couldn’t manage to lend me a small amount of money for something that was very worthwhile.
As you can see I am quite angry about this situation. It may not be similar to your situation, but I don’t know all of the facts. All I am saying is make sure you look at what your other daughters would think if you did help out this daughter. Have you ever let down your other daughters with financial support without a valid reason? Would they resent you lending/giving her the money?
As I see it, if my parents now turned around after all these years and leant my sister and her partner the money for a deposit on a house, I would be very peeved and want a great explanation as to why they can lend her the money, but couldn’t do the same for me.
Just me two cents worth.
Thanks,
Luckyone
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