Personal Finance

My father-in-law strongly dislikes debt and he wants to give us $1 million and I'm not sure we should accept it from him

Christy Bieber

Published: January 20, 2025 9:07 am

Should you take a large financial gift from family members? This is an issue a Reddit user is facing.

The original poster (OP) explained that he makes a seven-figure income while his wife doesn’t work. The couple is moving from a paid-off $1 million home to a $3 million home. They’ve made a down payment but their plan was to have a mortgage on the new house and put the $1 million proceeds from the sale of their current place into the stock market.

The sticking point, however, is that his in-laws hate debt. His in-laws have somewhere between $5 and $10 million and have offered $1 million to put down on the home if the couple also uses the money from their house sale to pay down the debt as well. 

His in-laws don’t have the money invested anywhere, and if he took them up on this offer, he’d end up with only around $900K owed, which would be a lot less financial stress on a single income. So, should he accept the money or is he better off turning down the gift? 

Should you accept a large gift from loved ones?

The OP in this case is inclined to take the gift, as it’s a free $1 million. Plus, he said his in-laws are generally supportive and aren’t being controlling with the gift — they just dislike the idea of owing money and want to advance some of his wife’s inheritance so the couple doesn’t have to borrow. 

Obviously, there are a lot of clear benefits to accepting the funds, especially as mortgage rates are currently very high. While the OP would normally be better off investing rather than sinking so much money into a home, the fact is that the $1 million gift means he’d be getting a 100% return on his funds. Plus, by not having a large mortgage, he’d be able to make much larger investments later. 

Now, in some cases, gifts with family do come with downsides, including the potential for family stress if the recipients feel like the gift is a form of control or like they’ll be indebted to the giver. However, that doesn’t seem to be the scenario here since he said his inlaws are supportive and that his wife will eventually get the money anyway.

Under these circumstances, there’s very little reason to deprive his wife’s parents of the chance to help out during their lifetimes. His in-laws obviously prefer to see their money used to help out their daughter while they are alive rather than waiting to offer the money after they’re dead when his daughter may no longer need it, and that’s an admirable goal.

Always consider your relationship with loved ones before mixing money

The OP is in a good situation here because he has a good relationship with the gifters, and he doesn’t feel like the money is coming with strings attached that he can’t live with.  The situation seems like a win, especially since it helps his in-laws get something they want too — a daughter with little debt. 

This won’t be the case in every situation where loved ones want to provide funds. Anyone thinking of mixing money and family must carefully consider whether potential damage to the relationship could occur as a result.  Working with a financial advisor to understand the impact of the gift on all parties could also be beneficial to avoid problems. 

Ultimately, if there’s little chance of family conflict then accepting could be the right move. But if there’s a risk of resentment or problems, then the price of the gift may not be worth the cost to family harmony.