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?

I'm assuming the people saying not to do it are jealous that nobody has done this for them

It's so nakedly obvious

You’ve said that she travels a lot so how much is she spending on travel? Is she prioritising travel experiences over saving for the deposit for a house?

Agree with this question. Maybe she should travel less & save up?

I think you should invest for your own children tbh. You say you only see each other rarely. I think if you lived nearby & saw each other regularly then it would seem more normal.

What about if grandparents have to spend all their money on care costs?

I'd love for someone to give me a life changing amount of money! I'd be grateful forever.

I guess that maybe it's that gratitude that could burden the friendship.

Maybe next time you see her, ask to borrow a couple of quid, then tell her you bought a lottery ticket with her money, and won? Is that too crazy? I feel like that would work!

Never mix business and pleasure as the saying goes.i would maybe gift her around 20 to 25k .that's still a large amount. Maybe invest 50k for your dc

Keep your financial affairs private and don't talk about them or offer any money at all. That kind of thing has so many pitfalls.

You sound very caring.

Save the money for your kids - they'll need expensive stuff, university/house/car etc.

Without knowing her finances inside out I’d be wondering if it would impact any benefits she is receiving.

also - personally I’d prefer the beautiful gift of a deposit and then I earn as work for the mortgage payments. Then I’d feel like it was really mine.

but - what if I had to dip into the deposit for a personal emergency- never made it back up and never ended up buying the house - I’d be too embarrassed to tell my friend etc.

Tell her you’ve come into some money but maybe not how much - and what would it mean if you could help her out with a deposit etc. have a conversation with her.

Whatever you do, don't send her thousands anonymously! Worst case she gets investigated for money laundering, best case she is just very freaked out!

Could you see if there are any schemes like this open to friends? The family member puts 10% of the house price into a savings account and gets it back (with interest) after three years provided the mortgage is kept up to date. https://www.halifax.co.uk/mortgages/family-boost.html

This is the first one I found when I googled - I haven't done this myself.

I would not give such a large amount. I’d reserve it for my children’s future.
The bit that worries me is that you say “so I know the kids will also be thought of by their grandparents.”. I’m afraid this is never guaranteed. My uncle told my dad he’d “look after” me and my sibling in his will. He left us nothing. My mother claimed that she’d leave money to my kids, but she changed her will in her later years to leave me and my kids nothing. This is a scenario that comes up all the time on MN. Your parents and in laws could do the same.
If you have enough money to spare that you can leave the kids plenty plus have enough to cover your own contingencies, fair enough, offer it to your friend.

How recently have you had this inheritance OP?
I’d echo others urging caution, there’s no rush to give this money away.

I hear you when you say that you’re unlikely to need this money in the future and it sounds as though you really are very wealthy. Has there always been such a wealth disparity between you and your friend, and how have you both navigated this in the past?

If you are recently wealthy due to this inheritance, I can understand that the sudden change in circumstance might lead you to think that you have more money than you need, but: what if you or your children need very expensive private medical treatment one day? What if you or somebody in your family finds themselves in legal trouble and need the very best lawyers? What if you or your partner become ill and cannot work - have you already paid off your mortgage and do you have enough in savings to see you through? If you or somebody close to you needs long term care in a nursing home, the costs can easily be over £1,000 per week, it could add up so quickly!

Somebody would surely need to be a multi-millionaire in order to be able to give away £80k and still have a safety net to cover all these eventualities.

I think it's fabulous and in your position would do the same thing.
Not anonymous tho- she will never know and it may feel creepy.
I would sit her down and talk to her about it, and your reasons ie property. If she won't accept the gist, you could draw up a contract whereby you own a % of the property she buys. She would still be secure. You could then one day sign it over to her anyway.

I think this is lovely thing to do, in theory.

How would other friends feel if they found out you had done this for her but not them?

I like the idea of buying a house she could live in for five years rent free, whilst she saved money but I am not sure what would happen at the end of the five years?

I think I would be entirely straight forward. Say what you have said here. You feel fortunate and want to give her a gift for a deposit for a house so she has security and an investment then see what she says.

She can say no but I think she will be very grateful and it will as you say it will be life changing for her.

Please do it. You obviously want to.
Could you have a theoretical chat with her first e.g. would it be weird if…
Or say, I’d like to do this but worst thing would be if it changed our friendship…
Go on OP!

It sounds like you are confident about your financial situation so all the scare stories mentioned by pps would have to be absolutely dire to shake that.
If there is a way for you to be able to visit your friend or offer her a weekend away to celebrate or mark you coming into some money? You could presumably suggest one of those places that caters for kids too if finding time to be childfree is an issue. Offer her that first treat and see how she reacts and then over the course of the weekend you can gauge. If you are good friends then the discussion should be able to be had, but least worst option would be either a loan for a deposit or you buying a house that you suggest she lives in for nothing or a peppercorn rent while she saves up to do her own thing.
Go for it, you sound lovely

I wouldn’t gift her the money. However I would consider a few options:

1. Going on (and paying) for an amazing all expenses paid holiday with her. She loves travel and you love her company.

2. Possibly discussing loaning her deposit money for a share in equity of her house, with the knowledge that she can do whatever she wants with the house. So you loan her 50,000 and she takes out a loan for 200,000. Buys a 250,000 house, and you retain 20% equity. To be repaid whenever she likes or can.

If she’s doing loads of travelling she can’t be that hard up? Does she actually want to save up and get a mortgage? As much as you say she can spend it on whatever she wants, buying a house is clearly the expectation you have. Personally I’d be a bit annoyed if I gave someone what I thought was a life changing sum and they basically didn’t change their life. But as the receiver I’d also feel a lot of pressure to prove that I’d spent the money wisely in the way the giver wished.

If you’re set on it I like PP’s idea of asking her a hypothetical question and seeing how much she’d need to save/receive to reach her goals, then potentially offering that much

I've been thinking about this after being surprised at all the posters who said don't do it. And my answer is still the same: I would be extremely grateful if someone did this for me.

It sounds like its coming from a loving place but I wouldn’t, your relationship will become a victim-rescuer dynamic-if it hasn't already

No good deed goes unpunished. She will end up resenting you and it will likely destroy your friendship.

Money makes friendships turn toxic quick. She may resent you, she may feel embarrased, she may feel envious that you can give away this kind of money without a second thought and you don't know how those feelings will show themselves. You will, without a doubt, see a totally different side to your friend.
I wouldnt do it OP but I totally see why you would want to.

I’ve always thought if I won the lottery I’d love to give money (50k, 100k whatever depending on win) to different friends. Never occurred to me they’d feel it was charity or they’d somehow be indebted to me, it’s just passing on good fortune. I’d go with the lottery win. “ Had a big win, decided to share it” What she does with it is up to her.

Jesus fucking Christ, unless you’ve got millions of cash in the bank, save it for your kids. You’ve got no idea what the future holds and one day, god forbid, they might really need it.

I think this has disaster written all over it. Your relationship with her might not suffer, but how will her family feel? You mention they’re not supportive and she has a brother. They can turn round and say ‘ahh it’s alright for you and your rich bitch best mate who just hands out 80k like it’s nothing’. You’ll be opening a can of worms.

Ask her. Get talking about houses and what she’s looking for and how far she’s got with it, and then say you’ve come into some money and would be happy to help her out if she’d like you to. Suggest the different options people have said - giving her money for the deposit, making it a loan, buying somewhere yourself for her to live for X number of years etc. Don’t expect an answer straight away, and reassure her that this is a genuine offer and you’d involve a solicitor to make sure everything is above board.

Don’t lie and say you’ve won the lottery and are sharing it around - she would be more likely to accept, but if she ever found out the truth or realised she was the only one you gave money to then she would feel very small.

What are the circs in which you got this money OP? Is this inheritance or who is the giver? What would their wishes be?

If the recipient of my inheritance gave it away in this way I'd be spinning in my grave.

Apologies if this has already been mentioned (didn’t read all posts) but please take legal/financial advice before doing anything about this as there is a potential tax implication of giving sums this large.

You can only gift £3000 per anum tax free (£6000 if you have not gifted anything last year) above this amount there is a tax implication and the last thing you want is friend spending the money then being faced with a 20% tax bill. There are work arounds such as declaring it as an inheritance but a) I don’t know if you can do that for a friend rather than family member and b) if you die within 7 years of giving the money there is still a tax implication.