€43k Gift: Is This Maltese Dad’s Best or Worst Idea?

Picture this: a bustling afternoon at Pjazza Tritoni in Valletta. The sun is shining, and the square is filled with the hum of chatter and the clinking of espresso cups. Among the crowd, a local father is sharing his plans with friends – he wants to give his 18-year-old daughter €43,000. The reactions are mixed, and the conversation sparks a debate that echoes across Malta’s tight-knit communities. But is this father’s plan a blessing or a curse?

In Malta, where the average annual salary hovers around €24,000, €43,000 is no small sum. It’s enough to buy a modest apartment in Birkirkara or fund a university education abroad. But is it wise to give such a large sum to an 18-year-old?

Malta’s culture is deeply rooted in family and tradition. The ‘manna’ mentality – a sense of responsibility towards family – often translates into generous financial support. However, this also raises questions about independence and financial responsibility.

We spoke to local financial advisor, Mark Vella, who believes in teaching financial responsibility. “Giving such a large sum at 18 could be like giving a teenager the keys to a Ferrari. They might not be ready to handle it,” he says. Instead, he suggests setting up a trust fund with regular disbursements tied to financial goals.

In other countries, similar scenarios have led to a phenomenon known as the ‘boomerang generation’ – young adults who, unable to manage their finances, end up back home with their parents. A study by the University of Malta found that 35% of Maltese youth aged 18-35 are at risk of financial exclusion, highlighting the need for financial literacy.

So, is the father wrong for wanting to give his daughter €43,000? Not necessarily. But perhaps he could consider a different approach. “Maybe he could give her €10,000 now, with the rest tied to financial goals, like buying a house or starting a business,” suggests Vella.

As Malta’s economy grows, so does the need for financial literacy. The government has started initiatives like ‘MoneySense’, but more can be done. Let’s hope this father’s dilemma sparks a conversation about teaching our children how to manage money.

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