'I've just become a millionaire, and my friends expect me to share it'

Welcome to The Money Coach, a Times of Malta column where readers can ask questions about life's money issues. Send your questions about personal finances, inheritance, gifting or other personal finance topics to moneycoach@timesofmalta.com

Dear Luca,

I am 58 years old, and after a little over 30 years of investing consistently, I am finally seeing the seven-figure mark on my investment platform.

It is a moment of great pride. I've spent years investing a percentage of my salary month after month, and I have also dedicated lots of time to studying and researching personal finances.

This success has also led to an odd situation.  

My friends are all the same age as me, and none of them has reached a million euros in their accounts. One of them half-jokingly told me: ‘You should give each of us a small sum… after all, you’d need less than a million to retire comfortably.’

And that’s partially true. I’ve lived a comfortable life over the past decade with a net monthly income of €2,700. I am not married and don’t have any children. I don’t even have a family. My parents died some years ago, and while I have some distant cousins, that is all they are… ‘distant’. I hardly remember their names.

So yes, all I have are these couple of friends who have been with me for decades. We met where I work and like to share everything together.

While I personally wouldn’t mind helping them out so that we can all share wealth together, I am not sure they’d use the money wisely.

None of them know much about investing, and while they do have pension plans, it’s nothing close to the approach I took. They feel comfortable with a small return per year and their capital being guaranteed. I took a different approach… one that required more patience and risk tolerance.

What are your thoughts on this? What worries me most is not the money, but what happens to these friendships if I say no. Maybe there’ll be a form of resentment that I am not doing enough.

I don’t want to be egoistical - after all, what I did is not about the money, but to live a better life. And my life is much enhanced with my friends by my side.

Confused Millionaire.

Luca responds:

Firstly, congratulations on reaching a goal that takes decades of discipline to achieve.

Now, about feeling guilty about not helping your friends financially. 

I understand the sense of guilt but I would be cautious about turning your wealth into something that needs to be divided in order to feel fair.

Your comment that you are not even sure where they will use this wealth and how they will apply it is enough of an answer in itself.

This should not be about ‘forcing’ everything to be ‘equal’ by dishing out your wealth. If money starts to affect the relationship, it is important to recognise that this is not uncommon, but it still needs to be handled carefully.

In fact, money is a main culprit in changing the balance in relationships, even when no one intends to.

I recommend sharing your experience with your friends. Share what you did, the strategies you followed, and the emotions you experienced along the way. Never underestimate that last part; it is where many people fall prey in difficult times, especially during bear markets.

Remember, people take different paths when it comes to money, and not everyone has the same discipline, risk tolerance, or priorities. You kept disciplined throughout, and I am sure it was not always easy for you either.

So don’t downplay what you did; many people find it very difficult, despite its perceived simplicity. Spending all those years doing ‘boring investing’ (i.e. dedicating an amount per month to investing and letting it grow) and still believing in it will even in hard times, is a mindset that should inspire everyone.

That is what you can share with your friends. Because in many cases, showing someone how to build something for themselves is far more valuable than giving it to them. And if they do decide to be inspired, you would have done them a much better service than giving them the actual money.

There is nothing wrong with being generous, but generosity shouldn’t just be in the form of ‘donating’ money, it can also be in the form of shared experiences and guidance.

I hope this helps.

Luca is the founder of the Money Coaching Hub. Email him your financial questions or your response to today's question for a chance to be featured in a future column.

Disclaimer: This column is intended to provide general information on various topics related to personal finance. The information provided is for educational purposes only and should not be construed as personalised financial advice for your specific situation. Financial decisions are highly individual and can vary greatly based on your unique circumstances, goals, and risk tolerance. The author of this column is not authorised to provide financial advice. Before making any financial decisions, it is recommended to seek professional financial advice from an authorised financial advisor.