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It looks like none of the other answers actually addressed your question properly. Your question was: If I lend my son $X today, and have him pay me the current bank interest rate on deposits for the remaining term of the loan, how much of a "gift" have I given him? You wanted to use this information to determine how you could give a similarly sized gift ...


4

The OP has made it clear that she is interested in exactly how the two gifts can be made equal, considering that the gift to the daughter will come years (in a comment she says perhaps ten years) after the gift to the son. Other answers have talked about present value, and writing a provision in the mother's will to insure that the daughter does actually ...


3

I second NoAnswer's answer in general. I would strongly advise you to discuss what you are proposing with both children in advance, separately then together, to get their explicit consent only after listening carefully to what their reactions are, and most importantly to put all sides of the deal in writing. At the very least there should be a will ...


8

The reason this is so confusing is that 3 different forces are acting on this mess at once. Giving a gift to one child (and not the other) Lending money to one child (and not the other) Investing your own money for a viable return I get where you are trying to create synergy here, but this is creating an overload. In our culture, dealings with money ...


3

Assuming strong family ties, you could just talk to your kids. Both of them. At the same time. In my family, we have agreed that I give my mother money for home repairs and get a signed loan contract with 0% interest, which will increase my share when inheriting the home in what I hope will be quite some decades in the future. For my location (Germany) this ...


0

Have you talked to your younger daughter and asked her how she feels? The important thing here doesn't seem to be that you feel that you were treating them evenly, but that she feels that you're being fair - so talk to her and find out what would make her feel comfortable. Instead of trying to figure out a fair way to do it on your own and then dictating ...


3

Assuming you aren't offering a better interest rate than the current mortgage then on day 1 you won't be giving your son any gift. The gift will be given at the point in time you decide to write off the loan. So to keep it simple, you could gift your daughter the same amount that you write off and at the same time as the write off. Or alternatively, gift ...


2

This may not be the kind of an answer you are looking for, but let me offer an alternative prospective. For one, the money is yours, but at the same time, its your families. Your eldest needs the money right now, its nothing to do with being fair. If and when your daughter is in need of any money, this also sets a precedence that you will be there to support ...


11

can promise the same cash amount later, but how do I financially value the benefit my son gets now? I suppose your question is outlined above. You want to give money X Amount to your son now and same amount X to your daughter, but later, and wondering if that is fair. In a positive interest rate environment "dollar today is worth more than a dollar ...


15

If you want to be fair then be fair. It sounds like you wish to gift this money so offer it as a gift. Hi kids, I have an extra £xyz lying around so I would like to give each of you half. If this is truly a "no strings attached" gesture then I would like to add that you are a very generous parent. If this is a dirt-cheap write-off loan you wish to offer ...


0

Not quite the question you were asking, but there are a few products such as YBS's Offset Plus for Savers that allow you to use your savings to counteract someone's interest payments. This may help to keep the playing field slightly more level in that you're not actually giving them money, you're just reducing their interest payments (in exchange for not ...


27

I tend to follow the Keep It Simple, Stupid principle. Next year at the same time when I give my college student daughter some money for a car, I'm going to give her brother an equal amount of money. (I'll suggest that he add it to his own Car Down Payment Fund -- or if he buys a car by then -- apply it to the loan principal, but it'll be a gift and he can ...


76

Loaning money to close relations tends to end poorly. You are better off not loaning your older child money. This solves all your issues except for one. You mention that your cash savings are earning "almost nothing". Is this an emergency fund, or money that can be invested? If it is an emergency fund, you have yet another argument against paying off ...


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