Everyone has that one friend or family member who is not good with money. They spend too much on unnecessary items or aren’t able to go out at the end of the month until payday arrives.
However, sometimes financial problems can become serious. There are many reasons people end up with mounting debt or excessive repayments and as a good friend or relative you will want to help out. Be tactical if the subject is breached and if you feel the need to get involved then do so in a productive manner.
Help Them Find Help
You may want to offer plenty of your own advice but unless you’re a financial expert it is probably best your friend hears it from a professional. Help them find a consultant or charity they can talk through their financial difficulties with and come to a resolution. The first stage is acknowledging such problems before they can be acted upon. Check online and go through listings together to find something suitable.
Not everything you do is around money to provide a helping hand. Simply aiding them with tasks such as cleaning out their house and garden will cut back on their expenses while providing more time for your friend to set their finances straight. If they have children or pets then offer to look after them for a bit so they can focus on filling out important paperwork, applying for jobs or other important activities.
Act As a Guarantor
If your friend or family member has a record of poor financial management, with a bad credit rating to boot, then acting as a guarantor so they can take out a loan from providers such as Trusttwo could be a lifesaver. You need to prepare to cover the costs if they can’t meet repayments but if you’re in a stable financial position this is a good option to take.
Lending money to those close to you create all sorts of awkward situations and is a hard subject to discuss. In most cases it is better for your friend or family member to borrow money from you than from a bank. If you feel comfortable doing so and feel that it won’t damage your relationship, then create a written contract between the two of you with a designated repayment period.
Have you ever helped a loved one in a financial crisis or been the one who needed help? What tips would you offer others in the same situation?