AIBU to offer friend big chunk of money?

[Marven]

Difficult one... I've just come into some money. I already own my house, have two kids and a bit of savings. Mine and my partners families are reasonably well off, and so I know the kids will also be thought of by their grandparents.
This lump of money will give me some to upgrade the house and some to put away for the future.

I'm thinking of giving like £50-80k to my friend... How do I handle that and would you be offended if your friend tried to give you money?

My friend - we used to be close at uni, but live far apart now and life and family get in the way, but still keep in touch and see each other every few years. Last time I saw her she'd had to move rented accomodation again and was saying how shs didn't know if she'd ever be able to buy. Her family is not well off and they'd promised her some money for a deposit, but had then gone and given it all to her brother with nothing left for her! She works hard, travels a fair bit, but she just hasn't had the really fortunate start that I have in life.

If I gave her the money, I would have no expectation about what she did with it, although her talking about buying a house was what sparked this idea for me. I honestly wouldn't care. She's had a tough life and she deserves whatever she wants and however she wants to live her life. I just think that this £50-80k would make a much bigger difference to her life than to mine.

We don't live in the same area - she's up north so I'm hoping that money could be a useful deposit?

How would you broach it, or would you just be totally offended by it?

You have a good heart, OP.

Offer your friend the money. Say you won it.

If you gift money for a house deposit, then money laundering regulations require her to disclose where she got the money from and may require you to sign a document saying it was a gift. Just saying lying isn't a good idea about any source of money gifted for this purpose.

I feel guilty if my friend takes me out for dinner and then I forget the next time, so receiving that sum, even if it was to get me on the property ladder would be completely out of the boundaries of what I could accept. I was in rental for many many years and never thought I could buy but even then, never would I accept money from a friend like this.

I do agree it's a very kind thing to think of doing, but I can't imagine almost any friendships in which the friend would accept- none of my friends would take even £50 from me, let alone anything else. Payments 'in kind' like childcare, food, a nice gift are always appreciated- I have got flowers, vouchers for takeaways and things like that when wanting to spoil someone. This is another level and I'd be surprised if your friend accepted.

I've never known anyone spend so much to finish a relationship and that's what this will do. It will add a dynamic you don't need

I’d be really pissed off if I was your friend and people were telling you not to give me the money because it might hurt my pride. I’d be extremely grateful and I was told not to feel indebted, then I wouldn’t!

Offer your friend the money and don't make up some story about winning it or whatever, just tell her honestly that you'd like to help her. Any sort of story is bound to come out in the end. She knows you and presumably knows you aren't going to change towards her at all as you're her friend and you seem a very straightforward person. Just do it!

Absolutely! Give your friend the chance to decide.

It’s a lot of money to give away even if you think you’re buffered, you never know what will happen in future, eg, it costs a lot of money to put kids through uni (you could save them debt by giving them the loan equivalent for example) or someone in your family may need expensive medical treatment- I have seen this happen to a family who is reasonably well off as well.
My best friend is in a v different financial situation from me - I have paid for tickets for concerts etc when I wanted her to come but she can’t afford it but I think she’d be v insulted if I gave her money. She has also made not-so sensible decisions re her own finances. You wouldn’t be able to control what your friend used the money for either, ie house deposit.
Maybe sound her out hypothetically about it?

I think I’d visit, sound her out about her attitude/ability to house buying, then I’d offer to put in money and ring fence it through a solicitor. It’s still yours but you can assure her that if she moves house in the future, she can either transfer it with her or pay you back. You don’t mind which option she goes for.

I would definitely make it house related though.

Definitely agree with this. If you are in a position to help out a loved one & you're happy to do it, then I would just have a conversation with her, letting her know your plans. If she really doesn't want it then I'm sure she'll let you know.
It could be life changing for her & her family.
I think it's a lovely thing to do

You could offer to help your friend buy a home using a mortgage that allows friends and family to help with the purchase by putting a chunk of their savings against the loan.

E.g. an offset mortgage that allows friends and families savings accounts to be linked to reduce the interest on the loan (you might need to gift the minimum deposit also) https://www.ybs.co.uk/mortgages/offset-mortgages/offset-plus-for-borrowers
Having 80k offset against say a 150k mortgage would hugely reduce the interest due each month for your friends mortgage but the savings would still be yours.

Or a mortgage where for example you lodge the deposit and it remains yours. If the payments would be affordable for your friend https://www.barclays.co.uk/mortgages/family-springboard-mortgage/

Using these products you are allowing your mate to use the benefit of your money without giving it away. She might be more comfortable with this.

As with any home purchase she needs to consider that it is easier to get help with rent from benefits if you might need to- if you were unwell for example- than it is to get help with a mortgage.

🤣🤣🤣 as if

While you think now that you wouldn't care what she did with it, you might find the reality quite different. It will change the dynamics of your friendship, that doesn't mean it has to be in a negative direction, but there will be a change. Your friend may also not be as okay with it as you think you would be, and she would start to look at you differently. I would leave it for a year and think it over before doing anything. This is an idea that needs to mature for a while before action.

Not the same but some similarities… we are good friends with a family who live very near to us. Kids are similar ages and get on well, as do all the adults. The other family have access to 2 holiday homes that belong to her family, one in the UK and one abroad. We have spent all our money in the last few years on renovating a new house and this left very little for a holiday fund. We haven’t made a big deal of it, our choices were ours, but our friends have recognised that they a) can help and b) WANT to help. This has resulted in us being invited to join them a couple of times in the UK and, in summer, we’ll spend time abroad with them too. Our friendship is stronger because we know each other better as a result and we have mutual memories to talk about. We’re careful to always express our gratitude, with words or small gestures like a bottle of wine and chocolates, but don’t go OTT as we know they don’t want to feel like “The Benefactors” either.
Personally, I think you’re a lovely friend and need to do this, it’s just the practicalities that need ironing out… maybe take her away somewhere (neutral territory) and have a really good one-one heart-to-heart? I would be wary about making up a story like the lottery, as she’ll likely ask lots of questions and you’ll just be adding more and more untruths to the mix…for me, this would be what would hurt a relationship if I ever found out, not the fact that you made a genuine, heartfelt offer in the first place. Good luck! ❤️

I think it’s a lovely thing of you to do.
i would definitely chat to her first, tell her you’ve won some money and how much would she need to make her life easier.

Insane.

Unless you've won 90million.

Give her 5k.

Put rest in accounts for your kids.

Kindly OP if it’s 5% of your total assets - ie £1.6 million - you don’t can’t really afford to give that much away to anyone.

Your total assets amount to no more than the price of a small house in London. And you’ve never mentioned a pension.

80k would pay uni fees or towards a house deposit for your kids.

Don’t ever count on inheritance from grandparents as I said. It’s not just care fees that eat up legacies, if one of them divorced or dies the other could remarry and leave it all to the second spouse with their own kids.

I think this is very wise. Big decisions like this should be considered carefully over time. There's no harm in waiting a few months to mull it over.

It's not about jealousy as PP have suggested, it's about being sure you are making the right decision and that it wont affect your friendship or your own financial resources later on. We dont live in the movies, this is real life and it can absolutely affect friendships - people have already posted situations where it has. Ultimately the decision is yours but at least if you have thought it over carefully, then if it all goes pear shape you know you will be prepared for the consequences.

I also wouldnt lie about it, you'll then have to tell more lies to cover the first lie up and if she finds out you lied later on it will be really awkward and come across as patronising AF.

I would definitely do it if I were in your position and I would definitely accept it with grace and thanks if I were in your friends situation. Go for it! I think it's a lovely thing to do.

Not sure if anyone has mentioned this but it may be subject to gift tax.

I've just come into some money. I already own my house, have two kids and a bit of savings. Mine and my partners families are reasonably well off, and so I know the kids will also be thought of by their grandparents. This lump of money will give me some to upgrade the house and some to put away for the future.

You have two kids, yet you want to give away £50k-£80k to a friend?

I find it hard to believe that anyone is this naive.

80k for someone who is "reasonably well off" rather than "very rich" is a very big amount, and for someone you only see every few years?

As PP have said- never ever count on inheritances- there are a million ways that could be gone by the time you are expecting to get it.

Your total assets amounts to no more than the price of a small house in London. And you’ve never mentioned a pension

Which is irrelevant unless the OP is planning on buying a small house in London. Believe it or not but many of us live our lives perfectly happily without tying all our assets up in an overpriced shoe box.

Plus the OP might have a pension, if you pay for it out of your salary its easy to forget it exists, I don't count mine as 'assets' its just income that I'll get without having to work for it one day, there isn't a pot as such, so I'm never going to be able to access the money in one go like I could an investment account.

The OP has a house and more money than she could ever need so I don't see how giving away a tiny fraction will make a noticeable difference to her life.

Yeah I would do this. The living rent free in a property you own is a horrible idea - imagine if you fell out, she'd be homeless.

If you make it clear you don't care WHAT she spends it on, it's fine. But you have to commit to that - if wastes all of it ok gambling and doesn't have anything to show for it a year later, you have to accept that and not feel annoyed about it.

Some people's idea of a sensible use of money is not how someone else might want to live their life (e.g - £70k deposit plus a £30k/annum income would only buy a small house or one in an undesirable area, and maybe she'd prefer to spend more on rent on a nicer place now and not think about the future)

if it was me being offered it, then id be appreciative of the amount and basically i would preferred to be asked eg hers 80k would you make use of it etc