Get a pen and paper. If you want to get really fancy, you can print a template paper from a computer. This looks neat because you can give the paper a light design/picture and you can still write over it. Microsoft Word should have plenty of cool templates, ones with lines to write on as well. Beautiful stationery will make your thank you note even more pleasant to receive. Make sure to write in legible handwriting.
Try to personalize the letter as much as possible. This could mean starting the letter with the person's name instead of "Dear", or simply using more conversational language. This is not a professional letter.
Keep it simple. Start with saying thank you to the person. "Thanks a lot for the birthday money", "Your generosity is greatly appreciated", or "I just wanted to thank you very much for the money that you left/gave me" should do the trick.
Let them know what you plan on doing with the money, especially if it is a relative. A relative usually would like to know what the money will be used for and hopes that it is used for a good cause. Something like "I have been saving up for a new car, and this helps out a lot", "John and I have been having trouble making rent lately, this is going to help us out a lot", or "Now I have something to start my savings account with".
Say "Thank You". No matter how many times you may have mentioned this before, it does not hurt to say it again. Just a nice "Thank You!", "Thanks Again!", "Thank you so much!", or just wrap up the whole note with "Thanks, (your name)".
Add anything else you feel might be nice and/or necessary. If you haven't talked to the person in a long time, you might want to give a brief update on what you are up to.
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