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gifting to friends
Old 11-26-2011, 02:37 PM   #1
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gifting to friends

Is there a way to gift money to friends without changing the relationship?

I've been fortunate to have some wonderful friends in my life for decades. Unfortunately some of them have what many here would consider horrible financial sense, and still live paycheck to paycheck. When the inevitable big ticket cost occurs, the car needing major work, health problems, etc. they have no spare funds. I suspect they are not aware how much I've saved for FIRE.

Like many people I gift cash to charities and family, and I would like to for close friends as well, but I do not see a reasonable way to do it. For example, offering a gift might be taken as an insult, or might be deemed that I'm showing off. The potential to change the relationship seems too high, and I value the friendship too much to risk it. Still I'd like to help these people when they are in financial crisis. Is there a "safe" way to do it?
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Old 11-26-2011, 02:57 PM   #2
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You have a generous heart. I was about to say that an anonymous gift will help them and be neutral to your relationship, and then I started thinking, "How, exactly, can you give someone a significant $ gift anonymously, and not drive them crazy trying to figure out who the giver was?"

It's a problem I never expect to have, since my friends are well set up, and the few relatives who need cash, seem to have no trouble asking for it.

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Old 11-26-2011, 03:56 PM   #3
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You could send some cash annonymously to your friend. Possibly you could pay some of the friend's utility bills without divulging your identity. I do think that offering or giving money directly to the friend could set up some resentment and likely impact the friendship.

For the last several years I have been giving an annoumous holiday card with an $xxx bill in it to my secretary. She has no idea where it comes from. Her life is quite complex and I feel the $ may adds a bit to her family holiday. I've been retired for almost 2 years and the friend I had deliver the card last year will also be retired by the end of the year. This may be the last year I can do this unless I enlist another co-worker next year and swear her to secrecy. I'll have to work on it.

This summer I spent time working in a community garden and enjoyed lots of wonderful fresh produce. A woman involved in a charity project I am a part of continues to have a rough time with finances. I put together a box of the fresh produce and took it to the next charity work session and presented it to her. I said it was to thank her for the work she does with the charity and coordinating it for all of us who participate. She really appreciated the fresh food and I made it all about saying thanks.

Think of some creative ways to help your friends. Maybe your help doesn't entirely fund the latest crisis, but I'm betting it could help overall. Good luck and I would enjoy hearing what you decide to do and how it works out.
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Old 11-26-2011, 04:15 PM   #4
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I had an opportunity to do that once, when I had an inheritance from my mother. She had not left any special bequests, but I wanted to say "thank you" to some very special people who had been very good to her during her lifetime. So I simply gave them the gifts (each got a 5 figure cheque with a card) and said that Mom wanted you to have this. They were delighted and we have all remained good friends ever since. I think it would be much more difficult to give financial gifts on your own behalf without making the recipient feel beholden to you.
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Old 11-26-2011, 05:42 PM   #5
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You could send some cash annonymously to your friend. Possibly you could pay some of the friend's utility bills without divulging your identity. I do think that offering or giving money directly to the friend could set up some resentment and likely impact the friendship.
And for added enjoyment, be sure to sign the card "Your Secret Admirer! xxxooo."
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Old 11-26-2011, 06:31 PM   #6
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Offering a "loan" to a neighbor who needs it seems like it would be neutral enough. Then they can pay you back or not.
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Old 11-26-2011, 08:24 PM   #7
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Is there a way to gift money to friends without changing the relationship?
For example, offering a gift might be taken as an insult, or might be deemed that I'm showing off. The potential to change the relationship seems too high, and I value the friendship too much to risk it. Still I'd like to help these people when they are in financial crisis. Is there a "safe" way to do it?
Giving money to a friend will certainly place a value on the friendship.

You could offer to help, but I'd let them set the terms of the help. If they wanted to borrow money you could gift it to them and suggest that they pay it forward.

I like the anonymous approach. But what if they pissed the money away instead of using it as you thought they should?
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Old 11-26-2011, 08:40 PM   #8
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I have given/loaned money to 'net friends.
If they want to pay it back I will direct them to send it to others who need it.
If they don't...well it was a gift.
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Old 11-27-2011, 04:20 AM   #9
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I have had "friends" ask me for money before and I've occasionally obliged. But close friends who needed money have never asked. I have gifted them and let them know that I had no expectation of being repaid. These were friends I knew well enough that I had no qualms about offering and they had no qualms about accepting. Those are CLOSE friends in my book. YMMV
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Old 11-27-2011, 06:10 AM   #10
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Tough question. It all depends on the friends.

My "adopted" sister's husband's daughter was undergoing treatments for months. I knew the cost of the gas for the constant trips was causing distress on their finances. So I bought them a $50 gas card. You would have thought I had handed them a gold ingot. They were so appreciative of the gift.

My best advice is to be upfront with them about your wishes and ask them if you can cover a utility bill for a month or two. If not, maybe a grocery store gift card or similar would be OK.

Handing them cash might be a bit touchy for their pride.
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Old 11-27-2011, 06:59 PM   #11
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The worst that has happened to me is they say no thanks. I think in these times they were more suprised than anything. Gas,food,car repairs or med bills there are a lot of friends or relatives needing help out there and I am blessed Im holding my own and able to help a little.
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Old 11-27-2011, 08:22 PM   #12
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In one case at work, we did it anonymously. However, when the next case came up, it was an emergency, so I gave her the money. I told her I didn't want it back, she is going to pet sit for me free this year. I usually pay her to pet sit, so this worked out for both of us.
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Depends on the circumstances
Old 11-28-2011, 11:54 AM   #13
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Depends on the circumstances

I recently gave money to a much younger friend who was in college when his wife developed cancer. He accepted my unsolicited gift graciously, and I assume it brightened his day.

If the same guy were out of college and working, but not living within his means I would probably not as be inclined to give him money, in part for the reason you mention. If he had the means to repay, however, and I wanted to help I think a loan that I could afford to forgive would work better than a gift.
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Old 11-29-2011, 12:27 PM   #14
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Is there a way to gift money to friends without changing the relationship?

I've been fortunate to have some wonderful friends in my life for decades. Unfortunately some of them have what many here would consider horrible financial sense, and still live paycheck to paycheck. When the inevitable big ticket cost occurs, the car needing major work, health problems, etc. they have no spare funds. I suspect they are not aware how much I've saved for FIRE.

Like many people I gift cash to charities and family, and I would like to for close friends as well, but I do not see a reasonable way to do it. For example, offering a gift might be taken as an insult, or might be deemed that I'm showing off. The potential to change the relationship seems too high, and I value the friendship too much to risk it. Still I'd like to help these people when they are in financial crisis. Is there a "safe" way to do it?
I would give them the gift, and ask them to use it in a way to advance their financial independence. If they take this seriously and to heart, then in the long run they will no longer need your help, and can feel good about taking the "one time" gift from a generous friend.
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Old 11-29-2011, 12:58 PM   #15
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Ms. Scrooge here..... I would be inclined to leave things alone. If your friends were faced with an unexpected emergency and were in dire straights, then of course I could see helping.

However, someone who is living paycheck to paycheck and not anticipating the usual expenses of day to day living is not likely to suddenly develop financial sense. How will you feel if they take your money and decide to treat themselves to a weekend in Paris?

Think of your own future as well. You may have enough to live on comfortably now, but what happens 20 or 30 years from now? Will these friends bail you out if you can't survive on your diminished income because you gifted your own money away? What about your own spouse and children - will they have enough to live on if you give it away now?

I know I sound selfish but I'm really not. Just realistic.
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Old 11-29-2011, 04:37 PM   #16
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Thanks for the feedback, all. The anonymous approach sounds the most viable. Perhaps a money order purchased at and mailed from an out of town post office might work, though if I were the recipient of such I'd feel a bit creepy. My second choice would be framing the gift as a loan, and never expecting repayment, though that might leave them feeling uncomfortably obligated and thus change the relationship.

Instead of giving a man a FIsh, my preference is to teach him how to FIsh, but after decades of failed attempts I suspect these friends simply do not place much importance on FIsh. It's a different philosophy, similar to a vow of poverty. Over the decades these certain people have been so generous with their time and friendship for me I hate to see them struggle when the inevitable financial crisis hits.
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Old 11-29-2011, 04:51 PM   #17
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If they attend church you can ask the Pastor to give the funds to them without disclosing you as donor. Some church officials may even do that if they aren't members.
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Old 11-29-2011, 08:58 PM   #18
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I may have posted this a few years ago, but anyway, sometimes giving to (or getting from) friends can be funny. I was living my usual cheap life and salting away money back when I was about 40, just after my second son was born. One day my insurance agent dropped by and brought me some sacks of beans and rice and some salt pork. I didn't know what to say, so I just thanked him, and ate quite a bit of red bans and rice for a while!

Another interesting one is a woman friend of mine whose ex-husband had given her sacks of russet potatoes and yellow onions for Christmas, Like really big sacks. He was living in a rural agrarian commune, and this must have seems to him to be a valuable gift. But she was furious! Potatoes! Onions!

I felt that it was a pretty good gift myself. I always favored consumables- booze, a country ham, some smoked salmon, a box of good steaks that fell off a truck.

When we lived out in the country we ate a lot of horsemeat and liver and other meats that we got from slaughter houses. Never hurt to drive up in a really old Chevy Apache pickup with really crappy looking clothes and a wife that looked a lot like Buffy St. Marie with a bigger chest.

Sure, you can have a box of horsemeat, just be sure to scrape the charcoal off it. Long way from those days to hoighty toighty sashimi downtown.

But all of it is total fun.

Ha
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Old 11-30-2011, 01:10 AM   #19
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If they attend church you can ask the Pastor to give the funds to them without disclosing you as donor. Some church officials may even do that if they aren't members.
Yes, I have seen this in a recent (2009/2010) case -- it was nationwide news -- well, at least the end of it was -- and it happened pretty close to me, so I kinda know. Helps to prearrange it with the church. In the one case I have seen, checks are made payable to the church, and communicated from the donor to a third party (prearranged with the church), who relays the donor information to the church -- church then forwards the funds to the recipient. Donor gets a deduction, and recipient gets the donation. May not be legitimate to the letter of the law, but... I don't claim to be a tax expert.

Personally, I would not take the deduction on something like this.

But... this was not just a friend to friend transfer -- it was more like "somebody we all know needs financial help, and we should help" -- "we" being a specific group of people.
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Old 11-30-2011, 06:39 AM   #20
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Yes, I have seen this in a recent (2009/2010) case -- it was nationwide news -- well, at least the end of it was -- and it happened pretty close to me, so I kinda know. Helps to prearrange it with the church. In the one case I have seen, checks are made payable to the church, and communicated from the donor to a third party (prearranged with the church), who relays the donor information to the church -- church then forwards the funds to the recipient. Donor gets a deduction, and recipient gets the donation. May not be legitimate to the letter of the law, but... I don't claim to be a tax expert.

Personally, I would not take the deduction on something like this.

But... this was not just a friend to friend transfer -- it was more like "somebody we all know needs financial help, and we should help" -- "we" being a specific group of people.
This is not tax deductible because the donor is directing the gift to specific individuals. It does mean, however, that the gift can be given by a real person with words of compassion and friendship, which make it easier to understand and accept.
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