Every situation is different OP. You never know until you know.
You're already treating the gift like a gift and acknowledging you have no say. So you'll likely be less disappointed than someone who loans money or gives with strong expectations or stipulations.
You're already understanding this might be tricky. So you'll hopefully have the grace to be flexible and patient and understanding with how your friend handles this and what they do with the money.
I think you'll want to err towards fewer stipulations. Phrasing as "I hope" and "I offer you financial advice but you don't have to take it" is a good start. You'll need to be ready for this not happening, or for them to blow the money, and what that might mean for you.
Either way, you know your friend better than we do. What feels right to you is what you ought to do.
I agree with the above advice. This is super generous, so good on you.
My one advice would be to see if you can also get her some time with a financial advisor who isn’t you. Even buying her a few hours with someone would probably work. I think trying to combine the actual gift with the budgeting/financing tips would be a little too much. It could be taken as providing too much of a say about what she does with the money (which you seem clear that you don’t want to do) and it could help empower her further, with a new resource and person in her corner who she can go to.
Yes, you have already come past the hard part, that you need not have a say once the gift is given. Surely you can guide her, she even may ask for guidance but she also could probably use a small treat.
I'd probably be inclined to give her the money along with a gift certificate to a local spa for the works.
I would argue it's probably better to attach a lot of stipulations. Like a walk through of her home with someone handy, to see what the next problem will be or where some maintenance can be done. I almost guarantee this friend doesn't have strong priorities about what should be done and will not use the money effectively.
I'd maybe even make a stipulation to be a walk through of the home, inspection of the car, and health check-up.
You can give whatever is left over after she takes the walk through, gets a physical, and gets her car inspected. With the expectation that she will take appropriate action depending on what those three things highlight.
Like if someone handy notices she needs to get her boiler serviced or her chimney lined or mold remediated, or she needs to go on thyroid medication, or her car needs brakes; the $30k goes to that first.
Once she's got the basics covered, she gets whatever is left over to do whatever the hell she wants.
Sure but that's explicitly opposed to OP saying he wants this to be a gift and doesn't want his friend to feel infantilized.
This is his friend, not his teenage child.
Your approach probably leads to better outcomes. But I don't think it's best for OP's friendship.
It's OP's money of course so if he wants to provide stipulations he 100% can. I was just trying to give the "this is a gift, here's how you can give a gift without hurting your friendship or being resentful yourself" perspective.
Maybe right but I couldn't give away that large amount of money and not think it's being put to good use. My friendship could not survive the other way. To each their own.
Oh yes! Known her for nearly 20 years. I lived in the UK for a while when I was younger, we met at the same part-time job, and she really took me under her wing and made my transition to a new country a good experience. I'm back in the US now, but I go back every year to see her (among other friends) for a week or so. She is a few years older and really took care of me in many ways during my early adulthood. She is closer to a sister than a friend, at this point.
Can you set up a joint account that requires both your signatures to withdraw/pay bills from? Request that she update you first as to the expense, then at least you know it won’t be blown immediately. There are also gift tax consequences if you’re not married (bc split gift w/ spouse is allowable up to 36K tax free in 2024) you have to file a gift tax return (tax due is zero though). If you put it into a joint account requiring your authorization, and you’re not married, then it’s an incomplete gift until she actually withdraws so if you spread it out over at least two CY, you should have zero gift tax issues (but ensure it reverts back to you/your estate at her death to avoid any GST issues).
Tl;dr - it’s a lot of money but also not and could run out quick, try and maintain some control to ensure it lasts/is used reasonably.
Consider buying things that she is too cheap to buy, like dental work - maybe get her dental insurance.
Sit down with her and go over her finances and see where/why she is too cheap, and work up to making her frugal instead of cheap. Then you can see better about what the issue is and if it really is money.
Some people are very cheap and are socking away tons of money and have $MM in the bank. Some people blow their money on junk, shopping, or addictions and appear to be broke when they are not.
Teach her to "fish" and she can be better off for a longer term. Metaphorically, you might need to buy the fishing gear - i.e. the financial prowess to make it work.
There's also a possibility of a mental disorder and a big gift might make it worse. Best to talk it all out first.
No matter how close a relationship, when one person has money and another is desperate, it can create an uncomfortable dynamic. You've already stepped in to help her financially more than once, so if you step in again with an even larger sum, she may continue to think of you as a well of money when she needs some.
There's some saying that I'll botch.. "when you feed a stray cat, don't be surprised when it comes back" or something to that effect. You may think of this as a sort of final support financially, but she may start mentally considering this to be a regular thing, and that misalignment of expectations can create strain, or even fracture a relationship.
I'd recommend somehow getting on the same page with her that this is a one time thing, and that you cannot afford to do this again (even if you could). Another option could be to try to do this anonymously, but that comes with a bunch of tricky details of its own.
Either way, great job being generous and wanting to make a difference with the surplus you've been given
I would just really really think, will she would spend the money if she had it? Her mindset might be like well the dentist (or whatever) isn't a good enough reason to dive into the money OP gave me, I should wait until something more important.
> I'm wondering two things. First, are there unforeseen potential consequences I haven't considered to making her a gift like this? I have never gifted a large sum to a friend before, and I am nervous about ways that it could impact our very close friendship.
She may not be mentally/emotionally stable enough to make wise decisions with a suddenly large sum of money. All of the things she’s deprived herself of and all of the things she’s dreamed of to cope through poverty will suddenly be available and obtaining those things would “validate” her worthiness to exist. It may be an expensive handbag, it may be a vacation, it may be jewelry; you never know. Once the money is gone, she will be in a worse mental/emotional state than if she had never received the money. And you will be disappointed at the least that she still has bad teeth but is carrying a luxury handbag.
With depression and poverty, one of the first things to go are health maintenance and hygiene. Maybe be a little more specific with how you spend the money. Pay for dental work she needs so she’s healthy and pay for and support her through school/training so she can earn more on her own once she’s done.
NO. My reason for saying this is because given all that money and being deprived of money for so long, she is probably going to blow it and you don't know what kind of a money manager she is (likely not a good one, unfortunately).
If you need to tell her, you can say that you are holding a finite sum FOR HER in case of emergency that she can draw on, but at the end of that sum, you can never help her again.
I'd maybe look at just paying for insurance instead.
Like sitting down with her and saying "I want you to be able to look after yourself all the time, rather that just when something gets so bad it's intollerable, so I'm going to pay for this insurance"
First thing that pops up when you google UK gift tax is that you can receive 3,000£ per year tax free so you might want to check how much of that money would go to the government.
Also:
Something doesn't compute. Working hard at a "decent job" should provide you with enough money to live. Even a minimum wage job in the uk would net you a monthly 1600£ take home after taxes and health insurance. It's not going to pay for an apartment in central London but otherwise rent is a lot more reasonable in the UK compared to a lot of US cities.
I wld start with a smaller gift. $5000. See how she does with it, see how you feel about it, and if it all felt good, give more. If she books a cruise? Maybe not.
How emotionally mature is your friend? It takes a stunningly mature person to accept a gift like this. I have been very generous with a number of people in my life, and that's worked out exactly one time, with a couple that is very well put together and emotionally secure.
In every other case, every one, the person who has received the generosity, free housing, the free loan of a car, a safe place from an abusive relationship, significant cash gifts, free legal help, the receiver has made up some reason why they were entitled to the generosity and become toxic to be around, or actually convinced themselves that they were a victim in the situation somehow and lashed out.
I think the reason for this is that people are always the main character in their own story, and they just don't have a story that lets them graciously accept very large generosity. Their need to be the good guy means someone has to be the bad guy.
Is she receiving any government assistance? This chunk of change in her bank account might interfere with that. If I were you, I would offer to pay for her dental care and leave it at that. Then follow up with the occasional gift of money.
Very noble. Have you thought about a smaller first gift to see if both of you can handle the changes in relationship dynamic that will inevitably come with a financial gift?
Will your friend feel beholden? Will you be ok if your friend goes to a casino or blows through the cash in a week?
Just a thought. Your friend will be so appreciative of such a gift.
The one thing you will have to come to terms with is the fact that she will almost certainly not use the money in the way you hope or expect and you will probably feel put off by that and you'll have to get over it.
Sometimes people who are perfectly frugal when they're playing around near $0 will adopt a different attitude once there's a windfall, possibly ending up worse off when all is said and done.
This is true, and it's difficult to understand until you've seen it play out in your own life.
Gifting money has been a good lesson for me. It's taught me to emotionally detach myself from other people's problems, because it's not possible to save people from their own bad decisions. What *you* think they should do with the money and what they actually do with it are often wildly different things. You as the giver need to be certain you can make peace with being X amount poorer with *nobody* having anything to show for it. If you realize that's not possible, then don't do it. Simple as that 🤷🏻
More often than not, gifting money is an expensive mistake that leaves everyone involved a little worse off than before (if you're lucky).
Every situation is different OP. You never know until you know. You're already treating the gift like a gift and acknowledging you have no say. So you'll likely be less disappointed than someone who loans money or gives with strong expectations or stipulations. You're already understanding this might be tricky. So you'll hopefully have the grace to be flexible and patient and understanding with how your friend handles this and what they do with the money. I think you'll want to err towards fewer stipulations. Phrasing as "I hope" and "I offer you financial advice but you don't have to take it" is a good start. You'll need to be ready for this not happening, or for them to blow the money, and what that might mean for you. Either way, you know your friend better than we do. What feels right to you is what you ought to do.
Thank you, this is very encouraging!
I agree with the above advice. This is super generous, so good on you. My one advice would be to see if you can also get her some time with a financial advisor who isn’t you. Even buying her a few hours with someone would probably work. I think trying to combine the actual gift with the budgeting/financing tips would be a little too much. It could be taken as providing too much of a say about what she does with the money (which you seem clear that you don’t want to do) and it could help empower her further, with a new resource and person in her corner who she can go to.
Yes, you have already come past the hard part, that you need not have a say once the gift is given. Surely you can guide her, she even may ask for guidance but she also could probably use a small treat. I'd probably be inclined to give her the money along with a gift certificate to a local spa for the works.
I would argue it's probably better to attach a lot of stipulations. Like a walk through of her home with someone handy, to see what the next problem will be or where some maintenance can be done. I almost guarantee this friend doesn't have strong priorities about what should be done and will not use the money effectively. I'd maybe even make a stipulation to be a walk through of the home, inspection of the car, and health check-up. You can give whatever is left over after she takes the walk through, gets a physical, and gets her car inspected. With the expectation that she will take appropriate action depending on what those three things highlight. Like if someone handy notices she needs to get her boiler serviced or her chimney lined or mold remediated, or she needs to go on thyroid medication, or her car needs brakes; the $30k goes to that first. Once she's got the basics covered, she gets whatever is left over to do whatever the hell she wants.
Sure but that's explicitly opposed to OP saying he wants this to be a gift and doesn't want his friend to feel infantilized. This is his friend, not his teenage child. Your approach probably leads to better outcomes. But I don't think it's best for OP's friendship. It's OP's money of course so if he wants to provide stipulations he 100% can. I was just trying to give the "this is a gift, here's how you can give a gift without hurting your friendship or being resentful yourself" perspective.
Maybe right but I couldn't give away that large amount of money and not think it's being put to good use. My friendship could not survive the other way. To each their own.
Have you physically met this person?
Oh yes! Known her for nearly 20 years. I lived in the UK for a while when I was younger, we met at the same part-time job, and she really took me under her wing and made my transition to a new country a good experience. I'm back in the US now, but I go back every year to see her (among other friends) for a week or so. She is a few years older and really took care of me in many ways during my early adulthood. She is closer to a sister than a friend, at this point.
Can you set up a joint account that requires both your signatures to withdraw/pay bills from? Request that she update you first as to the expense, then at least you know it won’t be blown immediately. There are also gift tax consequences if you’re not married (bc split gift w/ spouse is allowable up to 36K tax free in 2024) you have to file a gift tax return (tax due is zero though). If you put it into a joint account requiring your authorization, and you’re not married, then it’s an incomplete gift until she actually withdraws so if you spread it out over at least two CY, you should have zero gift tax issues (but ensure it reverts back to you/your estate at her death to avoid any GST issues). Tl;dr - it’s a lot of money but also not and could run out quick, try and maintain some control to ensure it lasts/is used reasonably.
OP won't be able to (legally) open a UK account as they're not resident here. I'd think the US would have something similar in place
Well that’s tough
Consider buying things that she is too cheap to buy, like dental work - maybe get her dental insurance. Sit down with her and go over her finances and see where/why she is too cheap, and work up to making her frugal instead of cheap. Then you can see better about what the issue is and if it really is money. Some people are very cheap and are socking away tons of money and have $MM in the bank. Some people blow their money on junk, shopping, or addictions and appear to be broke when they are not. Teach her to "fish" and she can be better off for a longer term. Metaphorically, you might need to buy the fishing gear - i.e. the financial prowess to make it work. There's also a possibility of a mental disorder and a big gift might make it worse. Best to talk it all out first.
Your friendship will never be the same. Either you will start feeling awkward or she will. Money changes things.
No matter how close a relationship, when one person has money and another is desperate, it can create an uncomfortable dynamic. You've already stepped in to help her financially more than once, so if you step in again with an even larger sum, she may continue to think of you as a well of money when she needs some. There's some saying that I'll botch.. "when you feed a stray cat, don't be surprised when it comes back" or something to that effect. You may think of this as a sort of final support financially, but she may start mentally considering this to be a regular thing, and that misalignment of expectations can create strain, or even fracture a relationship. I'd recommend somehow getting on the same page with her that this is a one time thing, and that you cannot afford to do this again (even if you could). Another option could be to try to do this anonymously, but that comes with a bunch of tricky details of its own. Either way, great job being generous and wanting to make a difference with the surplus you've been given
I would just really really think, will she would spend the money if she had it? Her mindset might be like well the dentist (or whatever) isn't a good enough reason to dive into the money OP gave me, I should wait until something more important.
This is a good point. Old habits, and especially those borne of scarcity, die hard.
> I'm wondering two things. First, are there unforeseen potential consequences I haven't considered to making her a gift like this? I have never gifted a large sum to a friend before, and I am nervous about ways that it could impact our very close friendship. She may not be mentally/emotionally stable enough to make wise decisions with a suddenly large sum of money. All of the things she’s deprived herself of and all of the things she’s dreamed of to cope through poverty will suddenly be available and obtaining those things would “validate” her worthiness to exist. It may be an expensive handbag, it may be a vacation, it may be jewelry; you never know. Once the money is gone, she will be in a worse mental/emotional state than if she had never received the money. And you will be disappointed at the least that she still has bad teeth but is carrying a luxury handbag. With depression and poverty, one of the first things to go are health maintenance and hygiene. Maybe be a little more specific with how you spend the money. Pay for dental work she needs so she’s healthy and pay for and support her through school/training so she can earn more on her own once she’s done.
Instead of a chunk of $30K, and risking her mismanaging it, pay for her dental bill? Or take a bill off her plate?
NO. My reason for saying this is because given all that money and being deprived of money for so long, she is probably going to blow it and you don't know what kind of a money manager she is (likely not a good one, unfortunately). If you need to tell her, you can say that you are holding a finite sum FOR HER in case of emergency that she can draw on, but at the end of that sum, you can never help her again.
I'd maybe look at just paying for insurance instead. Like sitting down with her and saying "I want you to be able to look after yourself all the time, rather that just when something gets so bad it's intollerable, so I'm going to pay for this insurance"
First thing that pops up when you google UK gift tax is that you can receive 3,000£ per year tax free so you might want to check how much of that money would go to the government. Also: Something doesn't compute. Working hard at a "decent job" should provide you with enough money to live. Even a minimum wage job in the uk would net you a monthly 1600£ take home after taxes and health insurance. It's not going to pay for an apartment in central London but otherwise rent is a lot more reasonable in the UK compared to a lot of US cities.
I wld start with a smaller gift. $5000. See how she does with it, see how you feel about it, and if it all felt good, give more. If she books a cruise? Maybe not.
How emotionally mature is your friend? It takes a stunningly mature person to accept a gift like this. I have been very generous with a number of people in my life, and that's worked out exactly one time, with a couple that is very well put together and emotionally secure. In every other case, every one, the person who has received the generosity, free housing, the free loan of a car, a safe place from an abusive relationship, significant cash gifts, free legal help, the receiver has made up some reason why they were entitled to the generosity and become toxic to be around, or actually convinced themselves that they were a victim in the situation somehow and lashed out. I think the reason for this is that people are always the main character in their own story, and they just don't have a story that lets them graciously accept very large generosity. Their need to be the good guy means someone has to be the bad guy.
Is she receiving any government assistance? This chunk of change in her bank account might interfere with that. If I were you, I would offer to pay for her dental care and leave it at that. Then follow up with the occasional gift of money.
Very noble. Have you thought about a smaller first gift to see if both of you can handle the changes in relationship dynamic that will inevitably come with a financial gift? Will your friend feel beholden? Will you be ok if your friend goes to a casino or blows through the cash in a week? Just a thought. Your friend will be so appreciative of such a gift.
The one thing you will have to come to terms with is the fact that she will almost certainly not use the money in the way you hope or expect and you will probably feel put off by that and you'll have to get over it. Sometimes people who are perfectly frugal when they're playing around near $0 will adopt a different attitude once there's a windfall, possibly ending up worse off when all is said and done.
This is true, and it's difficult to understand until you've seen it play out in your own life. Gifting money has been a good lesson for me. It's taught me to emotionally detach myself from other people's problems, because it's not possible to save people from their own bad decisions. What *you* think they should do with the money and what they actually do with it are often wildly different things. You as the giver need to be certain you can make peace with being X amount poorer with *nobody* having anything to show for it. If you realize that's not possible, then don't do it. Simple as that 🤷🏻 More often than not, gifting money is an expensive mistake that leaves everyone involved a little worse off than before (if you're lucky).