To feel like this IS actually a decent safety net?

[Hetplane]

I am feeling a bit crushed and flat after originally being overjoyed that I had been gifted what I thought was a decent safety net. More than decent actually.

I recently was gifted 120k from a family member. I’m 37 and have 200k left on my mortgage.

This gift came out of nowhere, I wasn’t expecting it and it’s absolutely blown me away as I never ever could have imagined this sort of safety net.

DB has received the same amount and has totally downplayed it. He is significantly more wealthy than me and whilst he has been grateful he has also referred to this as ‘running costs pot’ and told me I might be able to pay off some of my debt now (I have 10k debt and still my mortgage). This was not said nicely, it’s totally demeaned the money and made me feel stressed again about finances. I always try and save 300 a month but it’s hard (I’m single). He calls the gifts pocket money.

I am not sure why I am posting really. I suppose im wondering if I’m actually a bit deluded that in 2025 this is still a lot of money? I don’t have a hope of ever saving this myself and I feel a bit flat that it seems pocket money to most people!! I wanted to go down to four days a week at work now I have this but his comments have spooked me a bit.

Yanbu don't let this spoil it for you. it's an amazing gift.

Whether you should change work or think about what to do with it is another question.

200k left on your mortgage is a fair amount. I would have a look at doing the Rebel Financr School course.

It's a decent chunk of money but will be more life changing to you than him. It wouldn't be enough for me or DH to go part time without burning through it relatively quickly.
Pay the debt, pay another 80k to the mortgage keep 30k in accessible savings/ISA/premium bonds. The reduced mortgage payment will help to save further.

Or a divorce 😤

Sure it's important to plan financially, but personally I'd prioritise working less over other things that other people spend their money on.

I wouldn’t go part time, I’d want to keep the pension improving and invest the gift / pay off some mortgage though.
I don’t have a mortgage anymore but I’d be very very happy with that gift!

It is a LOT of money and life changing for most people. Ignore him, he sounds insufferable.

Not one person has mentioned inheritance tax and the seven year rule. OP, please research this and plan accordingly before you spend or use a lot of the money.

It’s a wonderful gift. If you feel rattled about part time work out why. Do you have a pension plan? Do you know how to maximise the gains from this money? Do you know about saving options? If your part time work means you eat into your gift then I would think k twice two unless it’s for a specific amount of time or a specific reason. Now is a fab time to make your future secure - your brother is a dick by the way.

It is below the threshold for IHT

https://www.gov.uk/inheritance-tax#:~:text=There's%20normally%20no%20Inheritance%20Tax,a%20community%20amateur%20sports%20club

Yes great point - and deprivation of assets if the donor may have care needs.

Sadly, £120k is not enough to buy a new brother!

Pay off your debt. Look at how much less you would take home if only working 4 days and if you plan to do that for the rest of your working life (probably 30 years or more) and what you would do with your 'extra day'. How much can you overpay on your mortgage without penalty because that will have a bigger effect. Plan a nice holiday or new car or home improvement and enjoy the relief of having a safety net of savings.

OP wouldn't have to give the money back if the donor died in less than seven years. It's only that the value would be included in the estate for tax purposes. It's not the recipient's problem.

And as for care needs, if I chose to give away £120k of my assets, the local authority couldn't prove I might need the money in twenty years time. Again, it's not the recipient's problem.

I agree with this, I'm afraid. The thing is, when you DON'T have that type of money and have had to be careful all your life, you've never had to consider how long it would actually last and what you can do with it. So it sounds amazing and yes, it IS lovely and it's right to be grateful.

But I always work in how many years' full times wages it is as a guide to how much it REALLY is. What does it equate to in real life? Say hypothetically you lost your job tomorrow and had to rely on the savings to live. If you're on, say, 25k a year full time, that's not even 5 years. And you're only 37 with a substantial mortgage.. Are you hoping that the 4 days a week would just be a temporary thing for a few years?

But on the other hand, time is precious too. And value isn't always monetary. Is that one day a week going to add more to your life than losing a day's pay and the equivalent pension contributions?

Your brother sounds like a pretentious, ungrateful knob. That’s a very significant amount of money! Don’t let his shitty attitude derail your plans or minimise the impact this sum will have on your life.

In a cash ISA that £100k would bring in just under £5k per annum. You'd get more in a stocks and shares ISA potentially but when there is a downturn in the market it could be less. And if you're withdrawing it every year then over time inflation will have an effect. That amount wouldn't be enough for me to reduce my own hours and i'm on shit wages. It would be very lovely to have each year though.

Personally I would keep working FT. I would then consider what I wanted to do with any gains per year, on a year by year basis. eg if you invested it in a S&S ISA if it was a particularly good year you could withdraw some to go on a nice holiday. If it was a bad year you could just leave it invested and hope it gains in value again.

Life is for living. I’ve spent a lot of money working part time and ad hoc and travelled and enjoyed myself. I don’t regret a single moment of it. I’d use some of the money for a sabbatical or once-in-a-lifetime trip and then save the rest. I definitely wouldn’t be fretting about pensions, mortgages or investments at your age.

@muddyford None of us know how old the donor is and their state of health, so a potential deprivation of assets situation could arise. Every local authority has a team that looks into the medical and financial records of someone in care or who is about to receive care and if there was a reasonable expectation of care needed at the time the gift was made, the LA will treat those gifts as still available for the care costs.

And the recipient of the gifts may have to pay IHT:

https://www.evelyn.com/insights-and-events/insights/the-seven-year-rule-why-it-matters-when-making-financial-gifts/

Pocket money?! Give over!!

For me having the opportunity to work part time meant I got to really enjoy when the kids were younger. They are all being to leave home and it feels like it went in a flash. I'm glad we had the time with them. We were skint but had lots of fun.

I hope the person who gifted the money to you doesn't ever find out how trivial a sum he finds it.
£120k is a large sum and the safety cushion it will provide to you is significant. For someone with less of a foothold than you have it could be lifechanging. So ignore him, continue to be genuinely thankful and gracious for this gift and use it to make good things happen in your life.

Inheritance tax is payable by the estate, not by the person who receives the cash

Let me get this straight. You’re in your thirties. You’ve received a gift (tax-free?) of £120k. Most people’s feeling in that scenario, no matter how much money they have, would be gratitude to the person who gave it to them. Most people would also feel appreciative of the good uses they could make of that money. It would take someone on average earnings (a little less than £40k a year) three years to earn that before tax and NI, so many years to save that amount. Yet you choose to feel ‘crushed and flat’ because of remarks by you brother, who sounds like a prick. If I were the person who’d given it to you and I’d be turning in my grave (if it’s inheritance) that I gave £120 k of my money to a wanker and another £120k to a drip.

You’ve still got many working years left before any pension would kick in. I’m assuming your income is modest if upon saving £300 per month you were scraping by. So going part/time is going to reduce that further. Yet you still have £200k on your mortgage. How much of the gift will you be eating into each month to continue to live?

Hadn’t thought of kids. If you have any of those this gift will very much be eaten into. University costs, driving lessons, house deposit……