€43,000 at 18: Is Saying No the Right Choice for Maltese Parents?

Imagine this: you’re sitting at il-Bajja, your favourite café in Rabat, sipping on a strong cappuccino. Your dad leans in, eyes twinkling, and says, “I want to give your daughter €43,000 when she turns 18.” You splutter, coffee grounds catching in your throat. “What?!” you exclaim, drawing curious glances from the next table.

This isn’t a hypothetical scenario for many Maltese families. With the island’s strong economy and the recent surge in property prices, grandparents are increasingly considering large financial gifts to their grandchildren. But is it wise to hand over such a substantial sum at 18? Let’s look the heart of this contentious issue.

In Malta, where the average monthly salary hovers around €1,500, €43,000 is no small change. It’s enough to buy a modest apartment in some parts of the island, or fund a university education abroad. But is it responsible to hand over such a substantial sum to an 18-year-old?

Proponents argue that it’s a head start in life. With property prices soaring, it could mean homeownership for the young adult. Or it could fund a business venture, travel, or further education. Critics, however, worry about the potential for reckless spending or financial mismanagement.

Malta’s economic boom has created a stark contrast between the financial realities of different generations. Baby boomers and Generation X often own their homes, have secure pensions, and are now enjoying the fruits of their labour. Meanwhile, Millennials and Generation Z face soaring property prices, stagnant wages, and uncertain job prospects.

Some see large financial gifts as a way to bridge this gap. But others worry that it creates an unfair advantage. “It’s not just about the money,” says Dr. Joseph Zammit, a local psychologist. “It’s about the message we’re sending to our children. We’re saying, ‘You don’t have to work hard, you don’t have to save. You can just be given everything.’ “

So, what’s the alternative? Many parents are opting for financial education instead. They’re teaching their children about saving, investing, and responsible spending. Some are setting up trusts, where the money is held until the child reaches a more mature age.

Others are looking at creative solutions. “I’m setting up a business with my dad,” says 21-year-old Maltese entrepreneur, Maria. “He’s giving me the capital, but I have to make it work. It’s a challenge, but it’s teaching me so much more than just handing over the money would.”

So, are you wrong to say no to your dad’s €43,000 offer? The answer isn’t black and white. It depends on your child’s maturity, your family’s values, and your long-term goals. But one thing’s for sure: it’s a conversation worth having. Over another cappuccino at il-Bajja, perhaps.

“Money doesn’t talk, it swears,” says Maltese proverb. Let’s make sure our children understand what it’s saying.